Global Economic Crisis

GLOBAL ECONOMIC CRISIS A CHALLENGE TO ACCOUNTING PROFESSION

By

SHEHU USMAN HASSAN
Department of Accounting
Ahmadu Bello University, Zaria.
08067766435, 08057777085
[e-mail]

A paper presented at International Conference with the theme: Global Financial Crises and African Quest for Development, Faculty of Administration, Ahmadu Bello University, Zaria. Kongo Conference Hotel, Zaria.
Kaduna State, Nigeria.

JULY 20th - 22th , 2010

Abstract
Accounting practices are deeply implicated in the global financial crisis and in proposals for restoring stability to the global financial system. This paper discusses the methodological and theoretical gaps in accounting research that explain our failure to anticipate the crisis and limit our ability to analyze and respond to it. Documentation and review of literature are utilized to identify the gaps. It is therefore noted that accountants globally fail to provide information about the range of uncertainty containing estimate of current values; income and cash flows but using flawed measurements such as value at risk or cash flow at risk and even statistical dispersion models used by them to predict future outcome are usually symmetric. These imperfect measurements lead to inability of accountants to predict the coming of global financial crisis talkless of mitigating against it. What therefore left to be done is for accounting scholars to be normative, descriptive and critical. Specifically, they should encourage accounting researchers to make their normative value judgments explicit, to describe and interpret the world of “accounting in action”, and to be critical in the sense of recognizing the politically and socially contested nature of accounting practices globally.

Introduction
Accounting has evolved, as have medicine, law, and other professions, in response to the social and economic needs of society. For the most part, early accounting dealt only with meeting the financial

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