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The Syntax of the Accounting Language: A First Step

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  • Frederico Botafogo

Abstract

We review and interpret two basic propositions published by Ellerman (2014). The propositions address the algebraic structure of T accounts and double entry bookkeeping (DEB). The paper builds on this previous contribution with the view of reconciling the two, apparently dichotomous, perspectives of accounting measurement: the one that focuses preferably on the stock of wealth and to the one that focuses preferably on the flow of income. The paper claims that T-accounts and DEB have an underlying algebraic structure suitable for approaching measurement from either or both perspectives. Accountants preferences for stocks or flows can be framed in ways which are mutually consistent. The paper is a first step in addressing this consistency issue. It avoids the difficult mathematics of abstract algebra by applying the concept of syntax to accounting numbers such that the accounting procedure qualifies as a formal language with which accountants convey meaning.

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  • Frederico Botafogo, 2019. "The Syntax of the Accounting Language: A First Step," Papers 1906.10865, arXiv.org.
    • Handle: RePEc:arx:papers:1906.10865
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    1. Biondi Yuri, 2011. "The Pure Logic of Accounting: A Critique of the Fair Value Revolution," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 1(1), pages 1-49, January.
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    4. Chiapello, Eve, 2008. "Accounting at the heart of the performativity of economics," economic sociology. perspectives and conversations, Max Planck Institute for the Study of Societies, vol. 10(1), pages 12-15.
    5. Hines, Ruth D., 1988. "Financial accounting: In communicating reality, we construct reality," Accounting, Organizations and Society, Elsevier, vol. 13(3), pages 251-261, April.
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