The Impact of Inflation Accounting on Connecticut Companies

Date of Submission

1983

Document Type

Thesis

Degree Name

Master of Science in Accounting

Department

Accounting

Advisor

P.V. Gerdine

LCSH

Accounting--Effect of inflation on--Connecticut

Call No. at the Univ. of New Haven Library

AS 36 .N29 Acc. 1983 no.2

Abstract

The mere mention of Inflation Accounting or its encompassing standard, FASB Statement No. 33, seems to stir up all sorts of controversial discussions and debates from those using, producing, and/or relying on financial statements. Arguments ranging from its confusing, time consuming adjustments, to its misleading experimental nature, have been revealed in articles appearing in various accounting and management publications nationwide. Some fear the costly additional data raises more questions than it answers; others feel the benefits of including the inflation adjusted data more than justify the costs. It hardly seems possible that the two opposing views are of the same FASB Statement.

Why is it that some companies are so drastically against FASB Statement No. 33, while others are optimistically in favor of the requirements? Is it just an opinion stemming from the costs and extra time involved in preparing the inflation adjusted data? Or could there be a more complex explanation directly related to the impact of the inflation adjusted data on a company's financial position?

This paper will: (1) analyze the opinions and attitudes of those companies located in Connecticut, ultimately revealing that the majority is in opposition to FASB statement No. 33, (2) review the various ways the data is being disclosed in annual reports, (3) uncover a possible correlation between opinion of Statement No. 33, method of data disclosure, and resultant impact of the inflation adjustments on a company's financial position.

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