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Positive Accounting Theory, Agency Costs And Accountng Regulation

Author

Listed:
  • Jagriti Srivastava

    (Indian Institute of Management Kozhikode)

  • Pankaj Kumar Baag

    (Indian Institute of Management Kozhikode)

Abstract

Positive Accounting Theory (PAT) is related to dealing with such matters such as possibility regarding the choice of accounting policies by firms and in which manner the firms will react to prospective new accounting standards. In relation to this, the existing agency theory breaks down as a positive theory as it does not cater for theory of accounting regulatory development. It stems from its dependence on the rationality assumption of the investor. We need to develop affluent theories based on either better rationality assumption or which considers broader view of organisational behaviour.

Suggested Citation

  • Jagriti Srivastava & Pankaj Kumar Baag, 2019. "Positive Accounting Theory, Agency Costs And Accountng Regulation," Working papers 346, Indian Institute of Management Kozhikode.
    • Handle: RePEc:iik:wpaper:346
    as

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    References listed on IDEAS

    as
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    5. Richard A. Posner, 1974. "Theories of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 5(2), pages 335-358, Autumn.
    6. Dye, Ra, 1988. "Earnings Management In An Overlapping Generations Model," Journal of Accounting Research, Wiley Blackwell, vol. 26(2), pages 195-235.
    7. Jules H. Kamin, 1975. "Optimal Portfolio Revision with a Proportional Transaction Cost," Management Science, INFORMS, vol. 21(11), pages 1263-1271, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Positive Accounting Theory; Accounting Standards; Agency Theory; Rationality;
    All these keywords.

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