Question#01: [Marks: 6+6+3-15) a) Define Accounting Theory. What are the alternative theory developinent processes in accounting? b) What is a theoretical paradigm? Compare and contrast among three dominant theoretical paradigms in accounting. c) "There is no universally accepted accounting theory"- Explain. Question #02: [Marks: 3+4+4+4=15) Wa) Why would free-market advocates argue that the regulation of financial reporting ultimately leads to an oversupply of accounting rules and standards? . b) Would you expect independent financial statement audits to exist for listed companies even in the absence of regulation requiring them to be undertaken? Why? c) Is it realistic to assume, in accordance with 'public interest theory', that regulators will not be driven by their own self-interest when designing regulations? d) What is a regulatory capture? Illustrate alternative ways of regulatory capture with example. Question#03: [Marks: 6+4+5=15] Va) Does the adoption of IFRS by different countries necessarily mean that the accounting procedures and practices they adopt will be consistent and comparable internationally? Explain b) Hamid, Craig and Clarke (1993) provide an argument that religion can have a major impact on the accounting system chosen by a particular country and that before "Western' methods of accounting are exported to particular countries it must be determined whether particular religious beliefs will make the "Western' accounting policies irrelevant. Explain their argument. Do you think that "profits' that result from holding gains should be allowed to be distributed to shareholders? Explain your view. c) In current purchasing power accounting, why is it necessary to consider monetary assets separately from non-monetary assets? Do you think in this inflationary situation worldwide, LASB should reconsider the measurement base? Why or why not? nott motive - what ] Question#04: [Marks: 3+5+4+3=15] VayWhat is positive accounting theory (PAT)? What factors instigate the development of PAT? b) Differentiate between accounting-based bonus plan and market-based bonus plan. Why market-based bonus plan fails to stop managers' opportunistic behavior? c) What is a debt covenant hypothesis? Provide evidence of managers' manipulation of debt covenant? d) How do big firms manage the political attention? Give example. Question#05: [Marks: 4+5+3+3=15] 2) Under the managerial perspective of Stakeholder Theory, when would we expect an organization to meet the information demands of a particular stakeholder group? Explain. b) Larrinaga-Gonzalez (2007, p. 151) wrote: The results of KPMG surveys of corporate social reporting reveal that while, in 1993 13 per cent. of the top 100 companies in 10_countries published a separate report about their environmental and social impacts, this figure almost tripled to 33 per cent (for 16 countries) in the 2005 survey. At the same time, casual observation leads to the conclusion that in the 1990s 'environmental" and/or 'health and safety' reports dominated the reporting scene. More recently, however, most companies publish an "environmental and social' or 'sustainability' report. In particular, from the 2002 survey to the 2005 survey, the percentage of separate reports (for the global top 250 companies) that correspond to the label "sustainability' and 'social and environmental" have increased from 24 per cent to 85 per cent, with a corresponding decline (from 73 per cent to 13 per cent) for environmental, health and safety reports. Page 1 of 2 CS CamScann You are to use Institutional Theory to explain these large-scale shifts in both report production and the names being given to the reports. ") Identify with example the alternative ways of gaining or maintaining corporate legitimacy. d) Discuss three alternative forms of isomorphism with example. (Marks: 4+3+4+4-13) Question#06; a) What is Efficient Market Hypothesis? Discuss the contribution of Ball and Brown (1965) in accounting. b) Earnings announcement of other firms of the same industry have information content- explain the statement. ") Explain what is meant when we say that the information content associated with unexpected earnings (profits) announcements is expected to be inversely associated with the size of an organization. d) Explain any three of the following terms in accounting: i. Media Agenda Setting ii. Fair value hierarchy iii. Disciplinary Society iv. Society of Control v . Hybridity and Ambivalence