This paper provides a theoretical background, based on legal and political fields, which we adapt to explain political interference in accounting in the “public interest”, at a critical moment —the last financial crisis. This framework goes beyond the positive accounting theory, and in...

DeAngelo and DeAngelo (2006) (D&D hereafter) argue that ‘payout policy is not irrelevant and investment is not the sole determinant of value, even in frictionless markets.' We first re-examine their critique using M&M's (1961) multiperiod valuation framework and identify non-essential...