User involvement in the standard-setting process: A research note on the congruence of accountant and user perceptions of decision usefulness

Abstract

This is an exploratory study which examines whether accountants and users of financial statements hold congruent or incongruent views on the decision usefulness of accounting information. This issue is important to the question of whether users require direct involvement in the standard-setting process, or whether their views may be adequately represented in the process by other participants such as accountants. Drawing on the sociology of professions literature under which professionals, such as accountants, are assumed to seek to maintain the judgement domain and indeterminacy of their professional task, it is hypothesised that accountant and user views on decision usefulness will be incongruent in those situations where a change in accounting method reduces judgement domain or indeterminacy. Specifically, it is hypothesised that, compared to users, accountants will perceive a lower degree of decision usefulness to be associated with a change in accounting method that reduces judgement domain or indeterminacy. Using a survey questionnaire, developed around a series of accounting method change scenarios, and administered to a sample of accountants and investment analysts (as an example of users), support was found for our hypothesis in relation to judgement domain, but not for indeterminacy.