Accounting representation and the onion model of reality: a comparison with Baudrillard's orders of simulacra and his hyperreality

Abstract

Baudrillard's “order of simulacra” and his notion of “hyperreality” are attempts of a postmodern author to deal with (or possibly reject) the problems of representation and ontology. These attempts were applied to accounting by Macintosh et al. [ Accounting, Organizations and Society 25 (2000) 13–50] with the conclusion that our present notions of income, capital, etc. no longer refer to real objects or events, and that “accounting no longer functions according to the logic of transparent representation, stewardship or information economics”. The current paper presents the author's own ontological and epistemological theory in reference to accounting representation (particularly to such notions as income and capital). These results are then juxtaposed to and compared with Baudrillard's view and its application to accounting by the Macintosh team. The conclusions are: (1) Baudrillard's approach is not suitable to accounting research or any scientific analysis; (2) the notions of income and capital still have referents in reality; (3) for accounting valuation a purpose-oriented representation is required; (4) the “clean surplus model” harbours some hope for future improvement of accounting. While Macintosh et al. (2000) and I disagree on the first two points, the last two items seem to be the major points of agreement between us.