What Are Recommended Accounting Textbooks Teaching Students About Corporate Stakeholders 2005 The British Accounting Review

What are recommended accounting textbooks
teaching students about corporate stakeholders?

John Ferguson
*
, David Collison, David Power, Lorna Stevenson
Department of Accountancy and Business Finance, University of Dundee, Dundee DD1 4HN, UK
Received 6 June 2003; revised 24 March 2004; accepted 9 August 2004
Abstract
This paper reports the results of a content analysis of the preface and preliminary chapters of 21
introductory accounting textbooks as recommended by 12 accounting degree-awarding institutions
in Scotland. The investigation builds on previous research which suggests that accounting education
is heavily inuenced by neo-classical economic theory and, as a consequence, inculcates students
with the notion that primacy should be given to shareholders above all other stakeholder groups.
Accounting education may be decient by neglecting other theoretical perspectives and margin-
alising the interests of other stakeholder groups; arguably this may inhibit the ethical development
and critical awareness of accounting students. This research investigates the extent to which
recommended accounting textbooks explicitly consider different stakeholders. Findings from the
study indicate that the interests of shareholders are predominant within nancial accounting and
nancial management textbooks, while management accounting texts have a more pronounced
managerial orientation.
q 2004 Elsevier Ltd. All rights reserved.
Keywords: Textbooks; Stakeholders; Shareholder wealth; Content analysis
1. Introduction
There is a growing body of literature which expresses concern over the purpose and
content of tertiary accounting courses. In particular, critics have questioned the role
of accounting education in maintaining the status-quo (Chua, 1986; Collison, 2003;
0890-8389/$ - see front matter q 2004 Elsevier Ltd. All rights reserved.
doi:10.1016/j.bar.2004.08.002
The British Accounting Review 37 (2005) 2346
www.elsevier.com/locate/bar
* Corresponding author. Tel.: C44 1382 344707.
E-mail address: j.x.ferguson@dundee.ac.uk (J. Ferguson).
Kelly and Pratt, 1994; McPhail and Gray, 1996), the priority it ascribes to shareholders
(Collison and Frankfurter, 2000; Gray et al., 1994; Puxty et al., 1994) and its failure to
develop ethical and moral maturity amongst students (Gray et al., 1994, 1996b; McPhail,
1996, 2001; McPhail and Gray, 1996; Seenan, 1995). Whilst these criticisms are aimed at
accounting education in general, they are rarely extended to include the textbooks that are
recommended on accounting courses.
However, despite the crucial role the textbook plays in the pedagogic process (Brown
and Guilding, 1993), no sizeable body of literature exists on the development and usage
of textbooks in the accounting and nance area. Indeed, this aspect of education theory
seems relatively undeveloped. A literature search has elicited only a handful of studies
that explicitly consider what values are implicit in accounting and nance texts, or try to
link the texts theoretical grounding to a.prevailing hegemony in the area (see Puxty
et al., 1994). In fact, the literature that does exist in this area tends to be limited to one
discipline (see Kelly and Pratt, 1994 or Scapens et al., 1984 for a discussion of
management accounting textbooks), or is discussed as only a small part of a wider study
(Zeff, 1988). Section 2 discusses the relevant literature in more detail. In particular, this
section attempts to link the concepts of ideology and hegemony to recent criticisms of
accounting education. This section concludes with a discussion of the literature that
addresses accounting textbooks specically. This is followed by a delineation of the
method employed in the study and a discussion of the ndings. The nal section
concludes.
2. Literature review
There have been concerns raised within the accounting education literature regarding
the ethical and moral development of accounting students; in particular, that the
theoretical underpinnings of the subject are restricted to only one subset of ethical
reasoning: nancial utilitarianism
1
(Gray et al., 1994, 1996b; McPhail, 1996; McPhail and
Gray, 1996). According to Gray et al. (1994, p. 62) restricting learning in this way, without
offering an alternative perspective from which students can exercise their own reasoning
ability is, in a sense, indoctrination (see also Loeb, 1991; Van Dijk, 1998). Therefore, by
not encountering any other ethical perspectives, accounting students learn to accept that an
action is judged to be desirable if it generates the maximum economic rewards.
Interestingly, McPhail (1996) and McPhail and Gray (1996) suggest that this nancial
utilitarian behaviour is restricted to the domain of accounting and that accounting and
nance students are able to offer evidence of more developed ethical maturity in non-
accounting areas of their lives (McPhail and Gray, 1996, p. 2). Therefore, students seem
to construct accounting and business activity as a separate category of experience
(McPhail, 1996, 1999; McPhail and Gray, 1996).
1
Gray et al. (1994) assess three modes of ethical reasoning; consequentialism (of which nancial utilitarianism
is a subset), motivism and deontology. They argue that no particular mode is inherently superior to any other, and
that it is quite often the case that individuals could apply all three. However, by emphasising one particular mode,
accounting education may restrict the development of ethical reasoning.
J. Ferguson et al. / The British Accounting Review 37 (2005) 2346 24
As a result of such a constrained ethical perspective, recent studies within the
accounting education literature have claimed that: (i) accounting students are failing to
develop deep approaches to learning
2
and, (ii) in this light, accounting education can be
viewed as a means of reproducing and sustaining the ideological status quo
3
(Chua,
1986; Collison, 2003; Cooper and Sherer, 1984; Gray et al., 1994; Hines, 1988; Kelly and
Pratt, 1992, 1994; McPhail, 1999; McPhail and Gray, 1996; Tinker et al., 1982). In
particular, it is claimed that accounting education contributes to the creation of a society in
which the identity and existence of those holding power is often obscured (see McPhail,
1999, 2001). Whilst student approaches to learning are implicitly considered throughout
the present study, it is the ideological role of accounting education which is directly
explored. Section 2.1 addresses the concept of ideology and describes Gramscis notion of
Hegemony; this perspective provides a basis by which to explain how more subtle forms of
power might operate within accounting education (and in particular, accounting
textbooks).
2.1. Ideology and hegemony
The term ideology is one of the most contested notions in sociology (Abercrombie
et al., 2000; Eagleton, 1991).
4
However, perhaps the most widely accepted denition is the
role of ideology in legitimating the power of a dominant social group or class (Eagleton,
1991, p. 5; see also Thompson, 1990). In this case ideology can be conceived of as a
critical concept or critical tool, whereby the phenomena characterised as ideology are
misleading, illusory or one sided (Thompson, 1990, p. 54). Drawing on this conception,
Giddens (1993, p. 722) describes ideology as a system of values and beliefs which help
secure the position of more powerful groups at the expense of less powerful ones.
2
Gray et al. (1994, p. 57) state that the development of ethical reasoning requires deeper and developmental
learning patterns. Deep learning is deemed to be consistent with the purpose of higher education (Duff et al.,
2003; Gray et al., 1994) as well as the avowed aims of the accounting profession (AAA, 1986; AECC, 1990a,b;
Albrecht and Sack, 2000; Gray et al., 2001; Mathews, 1994a). The underlying concepts regarding student
approaches to learning can be traced back to the phenomenographic studies carried out by Marton and Saljo
(1976), who identied two levels of processing when learning: deep and surface. A deep approach entails looking
for meaning in the matter being studied and relating it to other experiences and ideas with a critical approach. A
surface approach can be thought of as a reliance on rote-learning and memorisation in isolation from other ideas.
Researchers in a multiplicity of different elds have developed Marton and Saljos work to create self-reporting
inventories aimed at assessing students approaches to learning. Although differences exist within this research, 3
fundamental approaches to learning can be identied: deep, surface and strategic (see Duff et al., 2003).
3
The ideological status quo is considered to be representative of current social and political arrangements.
4
Thompson (1990, p. 2) argues that, in the two centuries since its conception, the notion of ideology has been
twisted, reformulated and recast. Equally, Eagleton (1991, p. 1) states that ideology has a world of useful
meanings, not all of which are compatible to each other. Some denitions include; specic kinds of beliefs, such
as fascism, communism or nationalism(Abercrombie et al., 2000; Eagleton, 1991); beliefs which are in some way
false or which legitimate (political) power (Eagleton, 1991); ideology constitutes any set of beliefs (a conception
which draws from sociology of knowledge in which all knowledge is deemed to be socially determined) (see
Abercrombie et al., 2000; Thompson, 1990); ideology is manifest in discourse which constrains what is said or
thought (Abercrombie et al., 2000; Bourdieu, 1991; Eagleton, 1991; Fairclough, 2003; Foucault, 1991;
Thompson, 1990; Wodak and Meyer, 2001).
The Italian Marxist, Antonio Gramsci, contended that traditional Marxist theories of
power were one sided in the exclusive attention they ascribed to the role of force and
coercion in establishing and maintaining a dominant ruling class (Boggs, 1976, p. 38). For
Gramsci, these theories of power overlooked the more subtle but pervasive forms of
ideological control that served to maintain repressive structures (Boggs, 1976, p. 38).
Gramsci (1971) proposed a renement to such theories by distinguishing between two
forms of political control: domination, which referred to direct physical coercion (for
example, by the police or armed forces) (Boggs, 1976) and hegemony which explained
how a governing power wins consent to its rule from those it subjugates (Eagleton, 1991,
p. 112 emphasis added).
5
Therefore, hegemony described social scenarios, whereby the
powerful do not have to impose power on subordinate groups because less powerful
groups accept prevailing conditions and constraints as natural or as common sense (see
Boggs, 1976; Eagleton, 1991). Danaher et al. (2000) cite Margaret Thatchers re-election
in the 1980s as an example of hegemony, whereby the working class maintained the status
quo (their relative disadvantage) by voting Conservative. In this sense, hegemony may be
viewed as a form of false consciousness or a mistaken view of the world (Danaher
et al., 2000, p. 48).
6
The concept of hegemony proposed by Gramci assumes that popular support and
legitimacy are required to maintain stability in the long term (Boggs, 1976; see also
Strinati, 1995). The role of civil society (or non-coercive institutions), in particular,
schools, universities, families, churches and the media, are viewed as integral mechanisms
in sustaining such support (Eagleton, 1991; Strinati, 1995; Mayo, 1991). Gramsci,
maintained that these structures reect an entire system of values; those of the established
order (Boggs, p. 39).
7
For Althuser (1971), education more than any other institutional
inuence, inculcated individuals with values that support the continued hegemony of the
ruling class (see also McPhail, 1999, 2001).
8
2.2. Accounting education, ideology and hegemony
McPhail (1996) maintains that both accounting and accounting education may be
considered a form of hegemony because accounting is constructed as an innocuous
5
Although in many cases hegemony is often used synonymously with ideology, there are distinctions between
the two terms; in particular, whilst ideologies may be forcibly imposed, hegemony generally relates to consensus.
In addition, Eagleton (1991, p. 112) states that hegemony is a wider term and includes ideology but is not
reducible to it (see also Abercrombie et al., 2000; Thompson, 1990).
6
The heuristic and contentious nature of such expressions which carry an implication of true consciousness is
acknowledged. See Roslender (1992) for a succinct discussion of the development of thinking on this topic with
particular reference to Marx.
7
For Gramsci the conception of hegemony could also be empowering or emancipatory, in that ruling class
ideology could be overthrown by a counter hegemony. Gramsci viewed the creation of working class
intellectuals or organic intellectuals as an intrinsic part of establishing such a counter hegemony (Boggs, 1976).
8
In a similar way to Gramsci, Althuser (1971) distinguishes between repressive state apparatuses
(government, army, police) and ideological state apparatuses (ISAs) (schools, religion, media, etc.). Althuser
(1971) maintains that ISAs are the most important mechanisms for social reproduction in industrial societies
(McPhail, 2001).
technical process, particularly within accounting education, even though it actually
imbues students with values and processes required for them to full a crucial function
within a capitalist system (McPhail, 1996, p. 287; see also Gray et al., 1994; Humphrey
et al., 1996) The pervasiveness of such unchallenged assumptions and perspectives
prevent the questioning of how social reality both arises and is maintained (Chua, 1986a,
1996; Cooper, 1980; Hines, 1988; Kelly et al., 1999). Moreover, it has been suggested that
hegemony is enacted within accounting education through the linguistic forms by which
knowledge is communicated to students (McPhail, 2001).
9
In identifying both direct and indirect
10
forms of propaganda, Collison (2003)
acknowledges that unwitting agents may be persuaded to sustain the cause of a master
voice. Whilst Collison (2003) is concerned with issues of propaganda (in particular the
role of corporate propaganda in developing different forms of capitalism) his discussion
addresses the role that accounting education plays in developing values in students which
serve corporate interests and which emphasise that the interests of only one group of
stakeholders should be maximised. In this sense, accounting and nance education and
practice, may be viewed as an indirect form of corporate propaganda, through the
promoting of taken for granted values and assumptions (Collison, 2003). This view is
shared by McPhail (1996), who states that accounting departments appear to function
as ministries of propaganda, subliminally instructing students in the rudiments of
neo-classical market economics, (McPhail, 1996, p. 278; see also Gray et al., 1994).
The assumptions which accounting education (whether intentionally or not)
uncritically propagates are apparent in the priority it gives to the interests of shareholders
(Collison, 2003; Collison and Frankfurter, 2000; Gray et al., 1994; Puxty et al., 1994).
Doyle (1994) notes the overwhelming deference to providers of capital and the emphasis
on short-term protability goals among the companies of Western developed countries (in
particular, the UK and US). In contrast, the objective of the rm for most Japanese
companies is generally to increase the long-term goal of market share, which helps
maintain lifetime employment for its employees (Doyle, 1994).
11
Hutton (1996, p. 269)
argues that Japanese capitalist structures emphasise trust, continuity, reputation and co-
operation and bring these ideals into all economic relationships. According to Doyle
(1994) the most common business objective and measure of performance for Western
companies is protability, either expressed as a ratio such as earnings per share or as a
percentage such as return on investment. He argues that almost all journals and business
magazines use protability to construct league tables of performance. For these reasons,
Doyle (1994) believes protability to be ubiquitous in organisations as a measure of
9
The relationship between language and power is a growing issue in the social sciences. Pierre Bourdieus
(1991) Language and Symbolic Power provides an extremely insightful account of the role of language in
maintaining power relations. In addition, an emerging discipline within the social sciences, Critical Discourse
Analysis, examines this relationship as the core of its analysis (see Fairclough, 1989, 1995, 2003; Wodak and
Meyer, 2001).
10
The term indirect propaganda is used to describe a situation, whereby the promotion of certain interests is
carried out unknowingly. In this sense, indirect propaganda could be considered hegemonic.
11
Doyle (1994) outlines a number of possible business objectives, including, protability, market share,
shareholder value and acquisitive growth, all of which, Doyle claims, focus on the perspective of different
stakeholder groups.
divisional and business unit performance. He states that it is primarily used by Western
companies as a means of protecting the interests of their shareholders (Doyle, 1994).
12
In more recent studies, Collison (2003) and Collison and Frankfurter (2000) extend
Doyles analysis. They contend that in modern business practice, maximising shareholder
wealth/value is the ultimate business objective and has replaced the old-fashioned
protability goal for many western companies. In addition to highlighting the technical
issues involved, Collison (2003) and Collison and Frankfurter (2000) acknowledge, more
importantly, that although the technique has changed, the interests to be served are still the
same (i.e. the shareholders). The shareholder wealth objective, with arguable circularity,
is considered to be the most intellectually respected by many theorists and practitioners
due to the considerable legal and conceptual merit attached (Doyle, 1994, p. 5),
13
despite
the fact that the user needs of other stakeholders are neglected.
14
2.3. Accounting textbooks
The important role of textbooks in accounting degree courses is emphasised by Brown
and Guilding (1993); these academics surveyed English University Business Schools in
order to assess the importance ascribed to different modes of instruction. The study
compared accounting and non-accounting faculties and ranked their teaching practices
according to the ten most widely applied methods. Their ndings indicate that for both
accounting and non-accounting schools, the top three teaching methods employed were
lectures, seminars/tutorials and prescribed textbooks. However, accounting departments
placed considerably more emphasis on both lectures and prescribed textbooks than their
non-accounting contemporaries. Brown and Guilding (1993) claim that because
accounting focuses on widely accepted practices, then much of the teaching can be
achieved through textbooks and prescriptive lectures, adding If, however, attempts are
made.to develop analytical and professional judgement skills.then different teaching
methods are needed (Brown and Guilding, 1993, p. 211). They suggest that the lesser
emphasis placed on tutorials in accounting departments might be suggestive of a less
discursive approach to teaching. The greater employment of prescribed textbooks by
accounting faculties may have educational consequences such as less critical analysis of
widely accepted theory and the homogenisation of accounting degree programmes
(Brown and Guilding, 1993).
Scapens et al. (1984) undertook an analysis of 24 management accounting textbooks.
Their study suggested that the core material of management accounting textbooks had not
substantially changed in the twenty-year period covered by the study. The inuence of a
neo-classical economic framework was noted in providing decision-making models.
12
Protability or earnings, as a business objective, is subject to practical, methodological and conceptual
criticisms (Doyle, 1994, p. 3) as prots can be easily manipulated by using different accounting methods (for
example, depreciation, accounting for stock).
13
Doyle (1994) claims that this is the case because the legal owners are the shareholders and the task of
management is to maximise the value they receive.
14
Despite the ascension of stakeholder theory over recent years, it arguably still remains a marginal part of most
degree courses.
The assumptions related to these models imply that the decision maker is either the owner
or shares the owners goals and is a prot maximiser (Scapens et al., 1984, p. 34).
In replicating the above study, Kelly and Pratt (1988) surveyed conventional wisdom
as presented to students of business through current textbooks to identify areas, where
the wisdom is now suspect and potentially damaging (Kelly and Pratt, 1988, p. 2). They
selected a sample of textbooks by asking eleven publishers for their leading texts. This
research concluded that over-simplied and incomplete perceptions of management
accounting were presented in popular management accounting texts and that the content
did not equip graduates to overcome management accounting problems in a practical
setting. The authors claimed that most of the textbooks analysed for the study relied
heavily on the format and content of previous textbooks which resulted in monotonous
homogeneity. One reason cited for such stagnation in management accounting
textbooks was that academics did not question conventional wisdom which they,
actively or passively, [helped] to sperpetuate to undergraduates through the use of the
textbooks they prescribed (Kelly and Pratt, 1988, p. 20).
Kelly and Pratt (1994) also examined the content of 13 introductory management
accounting textbooks which were recommended by degree-awarding institutions in New
Zealand. They raised concerns over the dominance of neo-classical economics and
scientic management in management accounting textbooks. They claimed that nearly
all management accounting textbooks assume that the purpose of management
accounting is to assist management to increase protabilities (Kelly and Pratt, 1994,
p. 316). By performing a comparative analysis between popular texts, Kelly and Pratt
(1994) showed that management accounting texts seemingly adhere to the same general
format. Similarities between Horngren and Drury for example are described as
remarkable (Kelly and Pratt, 1994).
Drawing on the work of Lee (1989), Hopwood (1988) and Kelly and Pratt (1994)
suggested that the inuence of the accountancy profession has had a negative effect on
students intellectual development (see also Humphrey et al., 1996; Gray et al., 1994). The
paper highlighted the lack of innovation and development in the form and content of
management accounting texts used for educational purposes and points to a general
absence within management accounting textbooks of explicit discussion of the traditional
framework or paradigm that informs the text. However, in their concluding remarks Kelly
and Pratt (1994) acknowledged an exception to this general statement. By trying to
introduce theory into a management accounting text, they contended that The Social and
Organisational Context of Management Accounting (Puxty, 1993) achieves an holistic
appreciation of the business world adding we feel that all serious students of
management should be exposed to the philosophical and sociological perspectives
(Kelly and Pratt, 1994, p. 325). The Puxty (1993) text, to which they refer, would arguably
be considered by most academic staff to be novel or at least idiosyncratic.
Zeffs (1988) exposure of the lack of regard afforded to the historical and social
developments of accounting standards within accounting textbooks, indicates at least one
way in which students may be prevented from acquiring a full appreciation of how change
occurs in their eld (Zeff, 1988, p. 434; see also Zeff, 1989). Manninen (1997) points out
that all texts are written with some purpose in mind and are therefore representative of
some vision of the world. The importance for students to engage in the critical reading of
texts is apparent when one considers the suggestion that textbooks contain certain
silenced assumptions and are built on many choices and concealments which were
evident in Zeffs (1988) study (Manninen, 1997, p. 287).
Despite the relatively few studies involving the content or use of accounting textbooks,
it seems apparent from the review of the literature outlined above that they have the
potential (whether intentionally or not) to maintain predominant ideological perspectives.
By presenting the rudiments of accounting in an uncritical manner without addressing the
implicit values and assumptions they expound or the processes of which they are a result,
accounting textbooks could be subjected to the same criticism that has been directed
towards accounting education in general. The purpose of this study is to examine the
content of the preface and introductory chapters of accounting textbooks as recommended
by accounting degree awarding institutions in Scotland.
15
By undertaking a content
analysis of the texts, the study aims to determine whether textbooks contain implicit
value assumptions, in particular whether they emphasise the user needs of particular
stakeholder groups.
3. Research method
The relevance of applying content analysis to the current investigation is apparent in
light of Krippendorf (1980, p. 18) observation that educational material [has been]
recognised as a rich source of data to facilitate the understanding of larger political,
attitudinal and value trends to be found in its textbooks. Smith and Tafer (2000, p. 627)
note that two generic approaches to content analysis are typically taken: the form
orientated approach (based on counting of words) and the meaning orientated approach
(based on counting of underlying themes). Krippendorf (1980) suggests the latter approach
is preferable but difcult in practice, whereas Smith and Tafer (2000) suggest that the
word approach is more reliable. The approach applied to the current investigation reects
the form orientated approach and is consistent with an early form of content analysis
identied by Krippendorf (1980) as quantitative newspaper analysis. This approach
reects the notion that the more frequently a word or phrase is used, the greater is its
importance to the area under investigation (Day, 1986; Fowler, 1991; Fowler et al., 1979).
As with all research methods, content analysis is subject to a number of limitations.
Milne and Adler (1999) and Unerman (2000) contend that content analysis studies
performed on corporate social reporting activity demonstrate a lack of rigorous reliability.
Of course, this depends partly on whether or not the analysis is performed as a word count
or as an identication of themes (Smith and Tafer, 2000). The accuracy of the analysis
can be improved by rigorous pre-testing (Krippendorf, 1980; Milne and Adler, 1999;
15
A perusal of course structures for participating departments would indicate that the rst two years of most
accounting degree programs are more technically focused, whilst the nal two years introduce broader themes
(for example, social and environmental accounting or accounting history). However, this focus on techniques
during the rst two years may result in them becoming deeply embedded and difcult to challenge in the latter
part of the degree (Humphrey et al., 1996).
Unerman, 2000). However, an unavoidable element of subjectivity in content analysis will
still remain.
The names and authors of the introductory accounting textbooks used on degree
programmes were obtained through a postal questionnaire. Replies to the questionnaires
were received between January and February 2001. Reminders were issued to non-
respondents in February 2001. As the replies to the questionnaires were returned, initial
attempts at performing content analysis on selected recommended textbooks were made
by the researchers. The analysis was performed on 21 introductory conventional
accounting textbooks which were recommended by Scottish university accounting
departments for the academic year 2000/2001 (see Table 1). The analysis concerned the
content of the preface and the introductory chapter only. This limitation was applied
because, rstly, time considerations prevented a full analysis of the whole text.
Table 1
Recommended textbooks
Financial accounting Management accounting Financial management
Atrill and McLaney (1999),
Accounting: An Introduction
Artrill and McLaney (1997),
Accounting and Finance for
Non-Specialists
Arnold (1998), Corporate
Financial Management (3)
Non-Specialists
Management Accounting for
Non-Specialists
Non-Specialists
Berry (1999), Financial
Accounting: An Introduction
Drury (1998), Costing:
An Introduction
Brealy and Myers (1996),
Principles of Corporate Finance
(2)
Dodge (1997), Foundations of
Business Accounting
Drury (1996), Management and
Cost Accounting (6)
McLaney (1994), Business
Finance for Decision Makers
Gillespie et al. (1997), Principles
of Financial Accounting
Horngren et al. (2000), Cost
Accounting: A Managerial
Emphasis
Pike and Neale (1999), Corporate
Finance and Investment
Gray et al. (1996a,b), Financial
Accounting: Method and
Meaning (2)
Mackey and Thomas (2000),
Management Accounting: A Road
to Discovery
Ross et al. (1996), Corporate
Finance (3)
Melville (1999), Financial
Accounting
Thomas (2002), Introduction to
Financial Accounting
Watts (1996), Accounting in the
Business Environment
Weetman (1996), Financial and
Management Accounting
Wood and Sangster (1999),
Business Accounting 1
This table summarises the textbooks recommended in session 20002001 on introductory accounting course in
Scottish University accounting departments. Two Institutions used Financial Accounting: Method and Meaning
by Gray et al. (1996a,b). Six Institutions used Management and Cost Accounting by Drury (1996). Three
Institutions used Corporate Financial Management by Arnold (1998), three Institutions used Corporate Finance
by Ross et al. (1996) and two Institutions used Principles of Corporate Finance by Brealy and Myers (1996).
There was one non-respondent for both management accounting textbooks and nancial management textbooks.
Secondly, it was felt that, typically, a general discussion about stakeholder groups would
be located at the start of each text while technical material would ll later chapters.
16
Analysis was performed manually at rst, counting the number of times each
stakeholder group appeared in the introductory chapter and preface and totalling the
number of words in each. Three researchers initially undertook text counts and compared
their results. These proved to be inconsistent at rst until a substantive list of synonyms
was developed and agreed upon (see Appendix). The results yielded thereafter were
generally consistent among all the researchers involved.
17
After the preliminary stages of analysis were complete, the researchers felt that the
process could be made more reliable if the manual element was reduced. It was decided
that scanning the introductory chapter and preface on to computer would yield reliable
word count results.
18
Once the scanning process was completed, the researcher proceeded
to search for the specic synonyms using the nd function in Microsoft Word.
19
The
frequency of use of each synonym was recorded and then tabulated in a Microsoft Excel
spreadsheet.
4. Results
The results of the analysis are discussed under the following four headings: nancial
accounting textbooks; management accounting textbooks; nancial management text-
books and observations. Other ways of presenting the results could have been used but it
was felt that this approach facilitated a comparison with what little literature exists in the
area and helped to structure the conclusions reached in a coherent manner.
16
A follow up to the initial questionnaire suggests that, in most cases, students are instructed to read the
introductory chapter as part of the course outline (53% of the initial respondents were contacted, all of whom
stated that they recommend students read the introductory chapter). However, the authors also accept the
possibility that even though certain chapters may be recommended as part of a course, students (for whatever
reasons) may not actually read them.
17
An initial list of the search criteria and associated synonyms (to be identied within the context of the content
analysis) were agreed upon by all of the researchers. Before any formal analysis of text took place, a random
sample from the list of recommended textbooks were read (introductory chapters only) in order to identify any
further synonyms which may have been overlooked in drawing up the initial list. Formal analysis commenced
once a satisfactory list was agreed upon.
18
When scanning the relevant textbook chapters, all the scanned text was converted to Microsoft Word les. In
some cases, not all of the scanned text (typically tables or gures) was readable in this format. When this
occurred, the non-scanned text was manually typed and added to the scanned text. Therefore, the content analysis
of the texts included all gures, tables and footnotes.
19
Initial inconsistencies were noticed but soon rectied. For example, if one were to probe for the word
shareholders, only the word shareholders is generated, but if one were to search for the word shareholder, both the
words shareholder and shareholders are generated. It, therefore, became apparent that to account for all the
occurrences of a word in a text it was required to search for it in its singular form. The results of this search were
conrmed using another software package (NUD.IST) which has the capacity to generate word frequencies from
large text les. The results from each were compatible.
4.1. Financial accounting textbooks
Eleven different introductory nancial accounting textbooks were prescribed by the
academic staff responsible for textbook selection in the 12 institutions which award
accounting degrees in Scotland. There was therefore a wide variety in the nancial
accounting textbooks used. In fact, the only nancial accounting textbook that was
prescribed by more than one institution was Gray et al. (1996a) (see Table 1). This nding
suggests that there is a great deal of choice among the nancial accounting texts and the
course lecturers at the institutions examined were making use of this large number of
alternatives.
20
For the content analysis, Table 2 shows the frequency with which various stakeholder
groups are mentioned in the preface and the introductory chapters of the nancial
accounting texts studied. A number of points emerge from a visual inspection of the table.
The number of occurrences of the word shareholder is far greater than any other and
therefore the inference is that the shareholders perspective is promoted more.
21
This was
the case for all but four of the recommended nancial accounting textbooks (see Table 2).
Artrill and McLaney (1997) and Wood and Sangster (1999) had higher word counts for
managers and creditors/suppliers, respectively, but even here the shareholder group was
second in each book in terms of the number of mentions given. For example, although
Wood and Sangster (1999) have 24 references to creditors/suppliers, they have 20
mentions of the word shareholder. For all the other texts, the term shareholder was the
most frequently used. It is worth pointing out that Wood and Sangster (1999) is unique
amongst all the recommended textbooks analysed due to the apparent emphasis on debtors
and creditors. However the reason for this is primarily the result of a number of
illustrations of double entry book-keeping and not of any explicit discussion of their user
needs. The term shareholder was actually used relatively little in the nancial accounting
textbooks and the phrase owner was more frequently applied. Overall, managers are the
second most frequently cited user group in the sample of recommended nancial
accounting textbooks.
At the other end of the spectrum debtors were not mentioned at all in six of the 10 books
studied, while trade creditors were not mentioned in four of the texts analysed. Gray et al.
(1996a) had no mention of customer/consumers, while Wood and Sangster (1999) did not
refer to the government or employees in their preface and introductory chapter.
One possible reason for such a high number of references to managers in the nancial
accounting textbooks could be the fact that many of the textbooks spend some of the
introduction explaining the difference between external and internal users of accounting
information. By identifying managers as internal users of accounting information, the texts
typically describe the type and form, which such information would take. In doing so, the
texts tended to make reference to managers in a number of ways; for example, they argue
that such information would help managers make decisions or assist them in target setting.
20
A greater level of homogeneity among the other areas was apparent, with six different textbooks being
prescribed for each of management accounting and nancial management (see Table 1).
21
A number of synonyms were used for each stakeholder group when analysing the textbooks. A discussion of
the synonyms used and their application can be viewed in Appendix.
Table 2
Number of appearances of words or synonyms in recommended nancial accounting textbooks
Text A B C D E F G H I J K Mean Std Dev
Total nos of words 8693 6282 12,552 13,969 7195 9746 4125 9080 12,290 11,687 2909 8957 3206.34
Description
Shareholder 33 8 44 46 33 9 20 34 49 59 20 32 15.28
Manager 32 33 18 33 9 5 15 16 6 43 0 19 11.46
Lender 6 2 7 6 9 3 9 8 0 16 4 6 3.21
Institutional investor 0 0 4 0 0 0 0 0 2 3 0 1 1.41
Employee 5 5 15 10 3 2 5 18 6 15 0 8 5.52
Government 4 4 7 7 3 2 3 13 5 6 0 5 3.35
Creditor/supplier 4 3 4 16 6 3 7 17 4 16 24 9 5.49
Debtor 0 0 0 5 0 0 0 3 1 2 18 3 1.80
Customer/consumer 6 7 5 5 1 0 5 11 4 10 1 5 3.22
Analyst/advisor 2 2 3 1 3 0 0 4 0 0 0 1 1.50
Wider issues 6 7 37 14 3 51 4 45 9 17 1 18 19.17
Total nos. of refs 98 71 144 143 70 75 68 169 86 187 68 107 38.85
Total refs as % of
total words
1.13% 1.13% 1.15% 1.02% 0.97% 0.77% 1.65% 1.86% 0.70% 1.60% 2.34% 1.30% 0.004
A, Atrill and McLaney (1999), Accounting: An Introduction; B, Atrill and McLaney (1997), Accounting and Finance for Non-Specialists; C, Berry (1999), Financial
Accounting: An Introduction; D, Dodge (1997), Foundations of Business Accounting; E, Gillespie et al. (1997), Principles of Financial Accounting; F, Gray et al.
(1996a), Financial Accounting: Methods and Meaning; G, Melville (1999), Financial Accounting; H, Thomas (2002), Introduction to Financial Accounting; I, Watts
(1996), Accounting in the Business Environment; J, Weetman (1996), Financial and Management Accounting; ,K, Wood and Sangster, Business Accounting 1. The
synonyms used to analyse the textbooks according to the above categories can be viewed in the Appendix along with an explanation of how they were applied in the
analysis.
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Similarly, many of the textbooks made a number of references to shareholders or owners
in the context of explaining the stewardship function of accounting.
Of the 11 textbooks analysed, only three addressed wider issues to any noticeable
degree: texts C (Berry, 1999), F (Gray et al., 1996a) and H (Thomas, 2002). For Berry
(1999), most of the wider issue references pertained to the natural environment. A
signicant reason for this nding is that Berry (1999) uses a case study which provides
extracts from the annual report of RJB Mining plc 1996. This extract is used to illustrate
how employment and environmental issues can be addressed in a company report. In
addition, Berry (1999) provides an extract from British Airways plc Annual Report 1996
1997, which contains performance measures other than nancial data, such as number of
passengers carried, to illustrate the importance of non-nancial information. However,
apart from a critique of the conceptual framework, Berry (1999) is very similar in many
respects to most of the other recommended nancial accounting textbooks, especially with
regard to its discussion of different user groups. This is the case because Berry (1999), like
many of the other authors, refers to the Corporate Report (ASSC, 1975) to identify
different user groups. One paragraph is then used to explain what information each user
group might require, except shareholders whose user needs take up a page of explanation.
Most of the references to wider issues in the introductory chapter of Berry (1999) were
contained in the case studies.
Thomas (2002) is the most recent book included in the sample and this might explain
the relatively large number of references to wider issues. The majority of the references to
different stakeholder groups emerges, but is yet again taken from a discussion of the
Corporate Report (ASSC, 1975). The difference between Thomas (2002) and the other
recommended textbooks examined is that this discussion also draws comparisons between
the Corporate Report (ASSC, 1975) and the Statement of Principles of Financial
Reporting (ASB, 1999), a comparison which could not have been made in many of the
other nancial accounting textbooks. The majority of the references to wider issues in
Thomas (2002) pertain to public accountability or the public role that accountancy
plays.
Gray et al. (1996a) were unique in the overall approach that was adopted by their text.
For example, they had the highest number of references to wider issues and relatively
few references to either shareholders or managers. In fact, 51 out of 75 (68%) references to
different user groups relate to a discussion of wider issues. Gray et al. (1996a) formed part
of a series of introductory accounting textbooks entitled Method and Meaning. The
intention of the series is described in the series editors preface (Wilson and Chua, 1993)
as adopting an approach that encourages both techniques acquisition and analytical
thought. This approach encourages students to consider the views of individuals and
society and not to accept current practice as being the most appropriate.
22
22
The series included the titles Managerial Accounting: Method and Meaning (Wilson and Chua, 1993) and
Financial Management: Method and Meaning (Puxty and Dodds, 1991). It is worth noting that the series has been
discontinued. The only surviving text from the series is Gray et al. (1996a) (now Bebbington et al. (2001)
Financial Accounting: Practice and Principles. If it were assumed that the discontinuation of the series was due
to lack of demand, then perhaps it could also be assumed that accounting educators do not want to prescribe
textbooks which deal with wider societal issues.
Gray et al. (1996a) emphasise the, arguably, frightening tendency for accounting
students to concentrate on the acquisition of techniques and to resist asking deeper
questions such as why are the techniques important? Accordingly, this text claims to
concentrate on developing students critical awareness of issues and encourages deep-
learning approaches to the subject. As one might expect from such an approach to
learning, Gray et al. (1996a) locate accounting within an historical context and explore the
signicance of events such as the Industrial Revolution and the implications of
accountings status as a profession. The majority of references to wider issues comes
not from a summary of the Corporate Report (1975) like many of the other textbooks, but
from considerations of how large organisations can affect the natural environment and
society and the role which accountants play in this process.
4.2. Management accounting textbooks
There was much less diversity among the recommended management accounting
textbooks. The most popular book among management accounting lecturers was Drurys
(1996) Management and Cost Accounting (see Table 1) which was used in six out of the 12
institutions in Scotland that award accounting degrees. One of the other textbooks
recommended for management accounting, Artrill and McLaney (1997), was
recommended for both nancial and management accounting at one institution, as part
of a general introduction to accounting. For the purposes of this study the text was
included in both the nancial accounting and management accounting analyses.
Unlike the nancial accounting textbooks, but very much as expected, the
recommended management accounting texts emphasised the user needs of management
considerably more than those of other stakeholders (see Table 3). When glancing over
Table 3 one cannot help but think that Horngrens Cost Accounting: A Managerial
Emphasis is aptly named, with nearly 180 references to managers/management.
Interestingly, even though Horngren et al. (2000) has 177 references to managers
compared to Drury (1998) who has 83, both equally emphasise the needs of this group in
relation to their total references to each stakeholder group (63%).
The only management accounting textbook which does not give priority to
managers/management is Mackey and Thomas (2000). In this text, the interests of the
customer are emphasised slightly more than those of management, with 50 references to
customer/consumer and 48 to manager (see Table 3).
23
However, two of the other
management accounting texts, (Drury, 1998; Horngren et al., 2000) also reference
customers a considerable number of times; 50 and 61 times, respectively.
Drury (1998) and Horngren et al. (2000) appear similar in a number of important
respects. This is especially true for the apparent concern about the customer.
23
Mackey and Thomas (2000) are unique among the management accounting textbooks not only because
managers are not the most mentioned stakeholder group but also because of the approach adopted in the textbook.
The book is written as a conversation between the members of a family who have just inherited the family
business and who each perform different roles within the business, such as nance director or management
accountant. It is through the conversation that the reader learns the nature of each role and the associated
techniques.
Table 3 shows that both these texts, and Mackey and Thomas (2000) had at least ve times
more references to customers than any of the other texts analysed. However, it seems that
this emphasis may not be the result of the authors stressing any moral obligation that
businesses might have to their customers, but rather an illustration of how management
strategies can be implemented in order to maintain customer satisfaction and thus yield
better prots. An extract from Horngren et al. (2000, p. 8) may help illustrate this point:
The challenge facing managers is to continue investing sufcient (but not
excessive) resources in customer satisfactionsuch that protable customers are
attracted and retained.
Similarly, the needs of employees are frequently emphasised in many of the
management accounting texts. Again, this emphasis is not based on any respect for the
livelihood of the employees, but rather on explaining why managers need to motivate staff
to attain organisational goals. For example, by introducing bonus schemes based on
performance targets or budgets, the texts argue that employees may work towards the
goals of the organisation or management. All of the recommended management
accounting texts assume this prot maximising behaviour to be almost self-explanatory
and no attempt is made to explain the values implicit in such performance/bonus schemes
(see Miller and OLeary, 1987 for a discussion of how the emergence of standard costing
made possible the governing of individuals within the rm).
Table 3
Number of appearances of words or synonyms in recommended management accounting textbooks
Text A B C D E F Mean Std Dev
Total nos of
words
6282 6809 9547 13,165 16,131 17,868 11,634 4852.01
Description
Shareholder 8 6 13 14 11 24 13 6.31
Manager 33 55 84 83 177 48 80 51.56
Lender 2 2 1 1 0 0 1 0.89
Inst investor 0 0 0 0 0 0 0 0.00
Employee 5 5 16 9 15 9 10 4.75
Government 4 4 6 5 5 13 6 3.43
Creditor/supplier 3 3 7 3 10 7 6 2.95
Debtor 0 0 0 0 0 0 0 0.00
Customer 7 9 50 6 61 50 31 25.71
Analyst/advisor 2 2 0 0 0 0 1 1.03
Wider issues 7 7 5 11 2 5 6 2.99
Total nos. of refs 71 93 182 132 281 156 153 74.83
Total refs as % of
total words
1.13% 1.37% 1.91% 1.00% 1.74% 0.87% 1.34% 0.004
A, Artrill and McLaney (1997), Accounting and Finance for Non-Specialists; B, Artrill and McLaney (1995),
Management Accounting for Non-Specialists; C, Drury (1998), Costing: An Introduction; D, Drury (1996),
Management and Cost Accounting; E, Horngren et al. (2000), Cost Accounting: A Managerial Emphasis;
F, Mackey and Thomas (2000), Management Accounting: A Road to Discovery. The synonyms used to analyse
the textbooks according to the above categories can be viewed in the Appendix along with an explanation of how
they were applied in the analysis.
The least referenced stakeholder groups were institutional investors and debtors which
had no references in any of the six recommended management accounting textbooks.
Similarly, the analyst/advisor group was barely recognised, with texts C (Drury, 1998), D
(Drury, 1996), E (Horngren et al., 2000) and F (Mackey and Thomas, 2000) not
mentioning the group at all in their preface or introductory chapter. A possible reason for
the lack of attention to these specic groups is the fact that management accounting is
regarded as an internal function to serve the information needs of management. All the
management accounting texts analysed seemed very keen from the outset to make this
distinction clear. Therefore, the external activity of institutional investors and analysts/
advisors do not feature much in the recommended management accounting texts.
4.3. Financial management textbooks
An examination of Table 4 clearly identies shareholders as the predominant user
group within the sample of recommended nancial management textbooks. The second
most frequently referenced user group was managers/management. A combination of the
averages among the nancial management texts for these two groups accounts for 75% of
the total references to user groups within the prefaces and introductory chapters. The
average number of references to shareholders in the nancial management textbooks was
96 as compared to 32 for the nancial accounting texts and 13 for the management
accounting texts. This emphasis is apparent in Arnold (1998), where 206 references were
Table 4
Number of appearances of words or synonyms in recommended nancial management textbooks
Text A B C D E F Mean Std devi-
ation
Total nos of words 22,502 6282 7405 5492 13,167 10,980 10,971 6364.10
Description
Shareholder 206 8 61 70 138 93 96 68.58
Manager 163 33 52 25 123 68 77 54.51
Lender 16 2 33 9 11 4 13 11.22
Inst investor 46 0 17 5 1 2 12 17.86
Employee 26 5 3 1 11 1 8 9.64
Government 17 4 2 0 0 8 5 6.52
Creditor/supplier 12 3 1 15 3 3 6 5.81
Debtor 2 0 0 0 1 0 1 0.84
Customer 11 7 0 0 1 1 3 4.59
Analyst/advisor 6 2 0 1 1 0 2 2.25
Wider issues 22 7 0 0 8 0 6 8.59
Total nos. of refs 527 71 169 126 298 180 229 164.40
Total refs as % of total
words
2.34% 1.13% 2.28% 2.29% 2.26% 1.64% 1.99% 0.005
A, Arnold (1998), Corporate Financial Management; B, Artrill and McLaney (1997), Accounting and Finance
for Non-Specialists; C, Brealy and Myers (1996), Principles of Corporate Finance; D, Ross et al. (1996),
Corporate Finance; E, McLaney (1994), Business Finance for Decision Makers; F, Pike and Neale (1999),
Corporate Finance and Investment. The synonyms used to analyse the textbooks according to the above
categories can be viewed in Appendix along with an explanation of how they were applied in the analysis.
made to shareholders. However, despite the fact that Arnold (1998) has more references to
shareholders than any other text, McLaney (1994) and Pike and Neale (1999) have a
higher percentage of references to shareholders.
The emphasis on shareholders was particularly apparent within the sample of nancial
management textbooks, except text B (Artrill and McLaney, 1997) which strictly speaking
is not a conventional nancial management text; although the textbook covers nancial
management material, it serves as a general introduction to all three conventional
accounting disciplines (nancial accounting, management accounting and nancial
management) and therefore all of these areas are covered in the introductory chapter.
Thus, the text does not talk exclusively about nancial management, which may explain
why it is relatively unusual among the sample.
A number of user groups were not identied at all by some of the textbooks; noticeably
debtors, which were not mentioned in four of the nancial management textbooks (texts B,
Artrill and McLaney, 1997; C, Brealy and Myers, 1996; D, Ross et al., 1996 and F, Pike
and Neale, 1999), see Table 4). Customers were scarcely referred to, and in fact were not
mentioned at all in texts C (Brealy and Myers, 1996) and D (Ross et al., 1996). The lack of
discussion of wider issues in the sample of recommended nancial management textbooks
was particularly signicant. Texts C (Brealy and Myers, 1996), D (Ross et al., 1996) and F
(Pike and Neale, 1999) made no mention at all of wider discussions, such as society or the
environment. The average reference to wider issues was six times in the nancial
management textbooks, which was the same as the management accounting textbooks but
signicantly less than the nancial accounting textbooks, which on an average, referred to
wider issues 18 times in their prefaces and introductory chapters.
24
4.4. Observations
For nancial accounting textbooks at least, texts seem to have moved away from being
a technical Bible for the average student.
25
The increased awareness and references to
other stakeholders in nancial accounting textbooks may suggest a move to incorporate
24
In addition to the analysis outlined above, the study also contained a longitudinal element, in that previous
editions of several of the recommended textbooks (Wood, 1979, 1993, Business Accounting, Drury, 1992,
Management and Cost Accounting, Drury, 1994, Costing: An Introduction and Brealy and Myers, 1991,
Principles of Corporate Finance) were examined for changes in their content throughout different editions.
Although the analysis was not as systematic as that applied for the content analysis, a number of points emerged.
Any changes that occurred between editions were essentially cosmetic or at most a revision of a particular
technique. For example, the companion web-site, power-point presentations or overhead projector slides were not
available with the third or sixth editions of Frank Wood but were present in the eighth edition. Drury (1998) was
the only text that made an attempt at integrating wider issues into its content. A new chapter in the fourth edition
entitled Organisational and Social Aspects of Management Accounting (chapter 22) addressed issues such as,
how management accounting can be used to maintain the subordination of labour to the needs of capital and how
management accounting can be used to legitimise decision making. However, this discussion was contained in the
latter part of chapter 22 and covered only four pages out of the 928 pages in the whole text.
25
Or the student of average ability (Castle and Owen, 1991, p. xii). This description of the authors intended
audience was apparent in a perusal of a number of accounting textbooks published 2030 years ago. It was also
made explicit that the purpose of these textbooks was to assist students who were sitting their professional
accounting examinations.
wider issues and perspectives. However, there are a number of reasons why this change
might not be signicant.
Firstly, an informal perusal of subsequent chapters shows an emphasis on double entry
bookkeeping and an absence of any detailed discussion about the needs of wider
stakeholder groups. A description of the different possible users of accounting
information, and of their needs, is generally contained within the rst chapter of nancial
accounting textbooks. It seems that their needs are only briey acknowledged and then
ignored for the remainder of the book. It is acknowledged that a limitation of the current
paper is that only the introductory chapters were examined and a detailed analysis of
subsequent chapters is left for further study.
For many of the nancial accounting textbooks, one could be forgiven for thinking that
all the introductory chapters had been penned by the same author,
26
such was their
similarity; Gray et al. (1996a) was the one noticeable exception to this generalisation. The
format of the newer, seemingly more enlightened, introductory chapters can be
summarised as follows: (i) denition of what accounting is, usually using AAA or AICPA
explanations; (ii) explanation that accounting information can be used either externally or
internally; (iii) explanation that nancial accounting is external and management
accounting is internal; (iv) discussion of external users with reference to those groups
identied in the Corporate Report (ASSC, 1975); and (v) limitations of accounting
information (usually its reliance on money measurement and its focus on historic
information).
The discussion about different users tends to be quite brief, with about 510 lines
devoted to each user, including how they could benet from information contained in the
company report. If a section in a recommended text is devoted to explaining the needs of
different users, there tends to be an emphasis placed on shareholders. This is not simply in
terms of the number of references made, but also in terms of the space devoted to
explaining user needs and in particular the goal of the organisation.
The tone of many of the larger recommended nancial management textbooks
suggested a strong shareholder emphasis. This was particularly evident from the
introduction of Brealy and Myers (1996, p. 3), where it is argued the secret of success in
nancial management is to increase value and that shareholders are made better off by an
increase in value. Apart from a noticeable shareholder emphasis in both the language and
analysis of the nancial management textbooks, a footnote that appeared in the rst
chapter of Brealy and Myers (1996) may help to illustrate the unquestioned, but highly
contestable ethical perspective projected by some of the nancial management textbooks.
26
Findings from an exploratory study into the production and use of accounting textbooks (Ferguson et al.,
2004) shed some light into why accounting textbooks are so homogenous. In addition to conducting interviews
with lecturers responsible for the selection of accounting textbooks, Ferguson et al. (2004) spoke with two
publishers regarding the production process of these texts. Both interviewees indicated that accounting education
was a dual market, encompassing both academic and professional aspects. This killing two birds with one
stone approach may suggest why so many recommended textbooks still have a strong technical emphasis, and
cover similar material. In addition, both publishers noted that, since the introduction of the Research Assessment
Exercise (RAE), authors were increasingly being recruited from Ireland and continental Europe. They noted that
many universities in the UK frowned upon their staff spending time on work that will not directly benet their
departments RAE position.
The footnote related to an explanation of corporation law and pointed out that if a
company were to incorporate in the US, then it would be subject to the laws of the state in
which it was incorporated. Brealy and Myers (1996, p. 6) explained Delaware has a well
developed and supportive system of corporate law adding even though they may do little
business in that state, a high proportion of US corporations are incorporated in Delaware.
This statement is generally held to mean that Delawares corporate law system is
supportive of companies and their perspectives in disputes with other parties.
27
Although a
seemingly innocuous statement, it may send the message to students that it is appropriate
conduct for a nancial manager to take advantage of (arguably, inadequate) laws that
prioritise shareholders interests over those of other stakeholders.
The use of imagery was also more apparent in the nancial management textbooks,
particularly when depicting the qualities or attributes of a nancial manager. The image of
the nancial manager was generally described as having to be a ruthless competitor in an
unforgiving business world. However, Brealy and Myers (1996, p. vii) stated that even
down to earth, red blooded managers (emphasis added) sometimes have to bother with
theory.
5. Conclusions
The results of this study offer an insight into some ndings from previous research,
which suggest that accounting students are inculcated with particular values that have
implications for their ethical and moral development. By identifying a pronounced
shareholder and managerial emphasis within a sample of recommended conventional
accounting textbooks, this study provides further support to the claim that the primary
ethical perspective conveyed to accounting students is that of nancial utilitarianism
(Gray et al., 1994). It would therefore appear that, in most cases, what students learn
from the recommended accounting textbooks analysed, is that an accounting decision or
action is only appropriate if it maximises shareholder wealth (or in the case of
management accounting texts, that it meets with managers and owners objectives) (Gray
et al., 1994; McPhail, 1996, 1999; McPhail and Gray, 1996; Seenan, 1995). This would
suggest that students are being deprived of a broader insight into the study of accounting
that could be provided through a consideration of other ethical perspectives. In addition,
such an emphasis, together with a lack of critical discussion, helps to reinforce an
uncritical approach to learning, with the possible implication that accounting graduates
who enter practice may be unaware of the ethical, economic and political assumptions
underpinning their work (McPhail, 1999). In this sense accounting education can be
viewed as means of maintaining the ideological status-quo through the unquestioned
reproduction of contestable values and beliefs (Collison, 2003; Gray et al., 1994;
27
Delawares non-jury Court of Chancery uses judges to resolve corporate disputes. The damages awarded by
juries in corporate disputes are often held to be punitive and therefore damaging to corporations (Ecologist,
2004).
Humphrey et al., 1996; Kelly and Pratt, 1992, 1994; Lewis et al., 1992; McPhail, 1996,
1999; McPhail and Gray, 1996; Puxty et al., 1994).
The content analysis would suggest that the ideology expounded in the recommended
textbooks is subtly concealed, and for the majority of the textbooks, is more apparent in
how the discourse is limited (what is left unsaid) as opposed to any explicit discussion
within the text (Hines, 1988). In this sense, the discourse of the majority of the
introductory accounting textbooks analysed can be viewed as maintaining a particular
system of thought by effectively silencing other constituencies claims regarding their
rights to accounting information (McPhail, 1999, p. 844). It is imperative that accounting
educators are aware of the ideological function textbooks can perform; furthermore, if the
calls for critical thinkers and active, independent learners by the professional
accounting bodies are to be taken seriously, then accounting academics must resist the
single perspective presented in most textbooks, help students to recognise the singularity
of views offered and provide alternative perspectives from which students can exercise
their own reasoning (McPhail, 2001). Further research may consider the extent to which
accounting educators do offer such alternative perspectives.
The content analysis of the recommended texts in this study represents a small step to
understanding the values (or implicit theoretical assumptions) in accounting textbooks.
Further analysis is required in order to illuminate the factors, which prescribe or inuence
the content of textbooks, including the role of the profession and professional accreditation
requirements. A deeper, more detailed analysis of texts might be employed, drawing on
studies in applied linguistics (see Sydserff and Weetman, 2002) or critical discourse
analysis (see Galhoffer et al., 2001) to provide a better understanding of the use of
language or the relationship between language, ideology and power. In addition, further
research may consider an analysis of the complete content of textbooks (as opposed to the
preface and introductory chapter), as well as an analysis of the supplementary material,
which supports these recommended texts.
Acknowledgements
The authors are grateful for the helpful and insightful comments from Ken McPhail and
Barbara Flood and for the constructive criticisms of two anonymous reviewers.
Appendix. Synonyms and decision rules for stakeholder categories
Shareholder(s): shareholder, stockholder, investor, and owner(s). The term investor
was not applied if the discussion was in relation to institutional investors. If it was not
possible to establish the context in which the term investor was used, it was assumed that
individual investors were being referred to and was therefore classied with
shareholder(s).
Manager/management: manager(s), management(s), board of director, director(s),
chairman or chief executive ofcer. The term management was not counted if it was used
to explain a subject or technique, such as just in time management. The term was only
applied if referred to an individual or individuals.
Lender(s): lender(s), bank, bondholder(s), building society, loan creditor/provider of
loan capital, savings and loan company. The term creditor was assumed to refer to trade
creditors unless the text was explicit in distinguishing between the two. The term bank was
not counted if it was in reference to a service, such as telephone banking or internet
banking. The term bank was only counted if it was in the context of explaining the role
banks can play in nancing an organisations activity by means of a loan.
Institutional investors: backer, pension fund, insurance company, nancial inter-
mediary, mutual funds, unit trust/trust fund.
Employee: employee, workforce, staff, human resources. The term human resources
was not counted if it was in reference to a human resource manager or human resource
management.
Government: for the purpose of this study no other synonym was applied.
Trade creditor: the term creditor was assumed to refer to trade creditors unless
otherwise stated. For the purpose of this study the term supplier was counted
synonymously.
Debtor: for the purpose of this study no other synonym was applied.
Customer: customer and consumer were deemed to be equivalent terms for the purpose
of this study.
Investment analyst/advisor: no alternative terms were applied
Wider issues: natural environment, general public, public, community, society, social.
The term environment was counted only if within the context of the natural environment,
therefore, terms such as business environment were not counted. The term society was
counted if within the context of explaining the impacts or affects business and accounting
can have on society/community/public. The term social was counted if an attempt was
made to explain the function of business or accounting within a social context, such as the
social role of accounting or the social need for accounting information
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What Are Recommended Accounting Textbooks Teaching Students About Corporate Stakeholders 2005 The British Accounting Review

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