Contemporary Accounting Theory: Kuhn, Chambers and Accounting Reforms

This report delves into contemporary accounting theory, focusing on the contributions of Thomas Kuhn and R.J. Chambers. It begins with an executive summary outlining the paper's objectives: to analyze Kuhn's theory of paradigms and scientific revolutions, and to examine Chambers' revolutionary approach to accounting. The introduction establishes the context of contemporary accounting theory and highlights the significance of Kuhn's and Chambers' work. The literature review provides a detailed explanation of Kuhn's paradigm, explaining how scientific progress occurs through periods of stable growth punctuated by revolutionary shifts. It discusses how a dominant paradigm establishes 'normal science' and how anomalies lead to crises, ultimately resulting in a new paradigm. The report then explores Chambers' revolutionary contributions, focusing on his emphasis on market-selling prices for financial reporting and his criticism of cost-based accounting. It contrasts Chambers' normative approach with the positive accounting theory. Furthermore, the report appreciates Chambers' work within the context of accounting reforms, and acknowledges the criticism against his theory such as the difficulty in differentiating between fact and fiction. The report concludes with a critical analysis of both Kuhn's and Chambers' theories and their impact on the field of accounting.

Running Head: COTEMPORARY ACCOUNTING THEORY
COTEMPORARY ACCOUNTIG THEORY
Name of the Student
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Author Note

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Executive Summary
The aim of this research paper is to the analysis of different scholars, who have introduced
the remarkable contribution of their researchers in accounting with the explanation of the
theories that has been developed over different time-period. Hence, under this research paper,
the review will be done on Kuhn’s development of theory of paradigm. Moreover, discussion
will be done on the Chambers revolutionary approach towards accounting. Lastly, conclusion
will be given on the critical analysis of both the theory given by Kuhn and Chamber. Hence,
it has been analyzed that accounting emerges from the state of crisis that is expected for
leading towards the shift of the allegiances in the favor of the one thought that culminates in
the emerging new paradigm.

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Table of Contents
Introduction................................................................................................................................3
Literature Review.......................................................................................................................3
Kuhn’s Theory of Paradigm and Scientific Revolutions Structure........................................3
Chamber’s Revolutionary Contribution in Era of Normative and Positive Accounting.......5
Appreciation of Chambers in Era of Reforms in Accounting................................................7
Conclusion..................................................................................................................................9
Reference..................................................................................................................................10

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Introduction
The contemporary accounting theory is that set of the assumptions as well as
methodologies, which are used in study as well as application of the principles of financial
reporting. The philosopher Thomas Kuhn’s has discovered the anomalies during the
revolutions in the science that leads towards the new paradigm. Moreover, R J Chambers has
also contributed the revolutionary concepts in the accounting for overcoming the failures of
the conventional accounting concepts (Edwards, 2014). Hence, this research paper would
discuss Kuhn’s explanation of paradigm as well as the structure of the scientific revolutions.
Moreover, discussion will be on the revolutionary contribution of Chambers’ in accounting in
the normative and positive accounting era. Lastly, appreciation will be done on how
Chambers has been accepted or he has been criticized in his contemporary period and in era
of the accounting reforms in the twenty-first century. Lastly, conclusion will be drawn based
on the discussion.
Literature Review
Theory of the Paradigm and Scientific Revolutions Structure by Kuhn
Thomas Samuel Kuhn was the great influencer philosopher of science around
twentieth century. The author has published the book named “The Structure of Scientific
Revolutions”, which was among the most cited academic book of all time. The contribution
made by the Kuhn to the philosophy of the science has marked not only the break of the
various vital positivist doctrines but it has also inaugurated the new style of the science
philosophy, which has brought history of science closer. The development of his account of
science development has held that the science has enjoyed the period of the stable growth,
which was punctuated by the revisionary revolutions. The science in the modern day is
predictable. In the various cases, in order to prove the already existing science, there was

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setting of the experiments with the expected results (Wray, 2016). When better tools are used
then findings becomes more precise. Hence, the gaps are filled with the new knowledge,
which alters the revolution by creating the new paradigm. Therefore, this has been
summarized in the book of Mr. Kuhn. According to Kuhn, paradigm is the exemplary
achievement of problem solving plus the matrix of disciplinary in support of their extension.
He explained that the normal science with the paradigm as well as dedication for solving the
puzzles is consists of the serious anomaly that leads toward crisis and then finally the
resolution of the crisis is done by the new paradigm. Further, the shifts of paradigm has
interrupted the linear progression of the knowledge by the help of changing the way scientists
views the world, the tools used for understanding it as well as the questions asked to it
(Shehata, 2014). Since, the worldview of the scientists after the shift of the paradigm is so
often differs from that comes before, that the two can be compared in accordance with the
mutual conception of the reality. The Kuhn has concluded that science path with the help of
these revolutions is not in reality towards truth but it is merely away from the previous error
(Naughton, 2019).
The “Structure of the scientific revolution” of Thomas Kuhn has introduced the
revolutionary approach regarding functioning of the science and its progresses. He has
attempted for viewing science as the progressing in leaps from the one paradigm to other. In
case, some paradigm is enough for accounting to world, as being perceived, the new normal
would be functioning. However, in case when the paradigm is entered in the crisis such as
meeting the phenomenon, which cannot be accounted for arriving at the internal
contradictions then the new paradigm is on (Mizrahi, 2015). He has viewed the practice of
science as something that has been conducted by community in comparison with the set of
individual. In some of the cases of paradigm that is good enough, as perceived to the world,
the functioning of the normal science can be done by elaborating knowledge within the

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paradigm. Moreover, the paradigmatic crisis leads towards the scientific revolutions, which
marks the shifts and ruptures from the paradigm that is preexisting. This means that the
earlier gained knowledge needs to be again integrated into concepts as well as structures of
the new paradigm (Hjørland, 2016). After it completes the complete science then it will be
functioning as the normal science, unless and until there is next crisis of paradigm as well as
next scientific revolutions. Thomas Kuhn has believed that the changes in the paradigm are
similar to the conversion of religion, which also helps to draws heavily contention from the
powers of conservatism. Therefore, scientific revolutions structure by Kuhn has marked the
postmodern turn in the science philosophy with the help of making the belief of human
relative field knowledge as of the objective knowledge (Maxwell, 2014).
Chamber’s Revolutionary Contribution in Era of Normative and Positive Accounting
The Raymond J. Chambers was one of the influencer theorists, internationally
recognized scholar as well as the important contributor of the study of accounting though
history. He was the advocator of the needs of the users of the financial statements. He has
investigated regarding what the users considers important not what accountants considers
important and he explained regarding what is relevant for their decision making. Moreover,
he has also challenged regarding existing prepositions of theory that he believed were the
only rationale behind the current practices (Müller, 2014). In his theory of the continuously
contemporary accounting, he has demonstrated with the logic as well as evidences that only
the market selling prices based accounting system is relevant to the evaluation as well as
decision making process of the users. He has endeavored for rejecting the widely held
assumptions that the accounting that is cost based is the superior rule. The intuition that
motivated this particular continuously contemporary accounting was that the investors should
know the company’s exit values at any point of time. Chamber has made the preference for

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the information on the adaptability of the firm relative to the dynamic environment of
business (Dean, Wolnizer & Clarke, 2006).
R J Chamber, who was the preeminent normative theorists, has criticized the
normative accounting theory in the aggressive manner and he has begun the article with
theory of positive accounting and has continued with label of ‘PA cult’ by considering it to
the theorists of positive accounting. He has asserted that the verbal adornments of cult such
as positive, empirical, economics based, scientific and others as well as the rituals, the
cohesion, the sanctions as well as its congregations has drawn the large number of the
followers in the orbit about the Chicago Rochester axis. The positive theory of accounting, in
general is the attempts for explaining world works in the value freeway. However, the
normative theory is not based on the observation rather it is based on the way process of
accounting should be done. It is believed that various different approaches are utilized by this
theory for ending up with the one correct option of accounting. This particular method uses
the formula for figuring out the income that is based on the value, not on the cost (Persson &
Napier, 2015).
The normative theory of accounting seeks for prescribing some of the basis of the
measurements of the accounting, financial reports contents as well as particular procedures of
accounting. Two elements are important in the normative theory. The first one is goal
assumption and the second one is deductive theory. The theory, which prescribes the
particular actions, is known as normative theories as it is based on the norms that are held by
researchers by proposing the theories (Gonnella & Talarico, 2017). The dichotomy exists
between the positive and the normative theories are used for categorizing the theories of
accounting as well as this particular dichotomy. It is not necessary that the normative
accounting theory is based on the observation and hence, it cannot be evaluated on the fact
that whether it reflects actual practices of accounting (Williams, 2014).

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Chambers has proposed the system of accounting that has prioritized the needs of the
investors that he has assumed that it would best in meeting by the continuously contemporary
accounting. The theory of Chamber is prescriptive as well as it is significant to this particular
theory. It has the view of the most useful information of the assets of the organization, which
is having the purpose of economical decision-making. It provides the information about the
existing cash equivalents. The measure is tied with the current net market values. It helps in
prescribing the valuation of the assets based on their market values. It has been for number of
decades that Chamber had been taken the initiative for advocating the assets valuation of the
assets based on assets. It is the prescription, which has challenged regarding the widespread
use of accounting of the historical cost. The model of accounting prescribed by the Chamber
states that the valuation of all the assets should be done on their market value (Gaffikin,
2014).
In accounting, the positive research has come to the prominence during mid-1960 as
well as there has been course of the shift of paradigm that is within research of the financial
accounting around 1970s and 1980s. The theory of positive accounting is based on the work
that is undertaken by economics as well it is mostly dependent upon model of the capital
asset pricing, agency theory as well as the hypothesis of the efficient market (E. Persson & J.
Napier, 2014).
Appreciation of Chambers in Era of Reforms in Accounting
Arguments in Criticism of Chambers Accounting Research
However, Chamber has been criticized on various issues. The statement given by the
Chamber that ‘exit values is only concerned with providing financial information’. This
particular statement claims to provide the answer of all problems concerned with the
historical cost accounting. However, model provided by him is not provided with the strength

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for handling the problems. Further, it is quite difficult for differentiate in between the fact as
well as fiction when the model cannot be relied on for providing the knowledge, which are
certain for the actions of the future as well as which does not help in representing the events
of past or the events of present (Gaffikin, 2014).
The second argument is the concept of adopting the existing cash equivalents. It helps
in introducing the term of additivity. It proposes that or making the decisions by
management, assets cash values are prescriptive. Hence, this particular concept helps in
ignoring the fact that the other considerations might be taken for instance, availability of the
funds through cash flows or borrowings as the business organization does not relies singly
upon the fixed assets sales to cash gain for investing or diversifying. Moreover, the idea of
business considering selling of the assets, which may be productive for acquiring the new
assets, can be used for the aggregate equivalents.
The interpretation of control, which is related to the assets that are under entity’s
control but it is having characteristics of getting convertible to the other means. Further, this
particular nature is required to the concept of the measuring the model of Chambers considers
view that is only one-sided of entity but it has not taken into account that whether the
additivity in the actions. It is valid for accounting information role that is in line with the
economic model of the firm (Gaffikin, 2014).
The uses of this relating to the events of the real world that Chambers has attempted
for portraying is considered to be somewhat having narrow view. It has raised the further
question that is relating to seriousness of commitment made by him towards the entity’s
concept of going concern that the theory of accounting can rely upon. Further, for dissuading
any type of counter argument, he made the plea to the emotions in comparison to the logic
that has been claimed by him for employing. He said that if it has to be disposed then let it be

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shown that other theory is fruitful equally. It generally suggests that all the other options are
less than the equal. It generally oversees that arguments are based on existing historical cost
model convention and traditional doctrines (Kabir, 2007).
Arguments in favor of Chambers Accounting Research
Apart from the various criticisms of the Chambers accounting research, there are
various arguments by the researcher who have favored and appreciated Chambers in era of
the reform in accounting. The theory by Chamber has provided the view of objectivity in
determining, which particular methods of accounting should be used for recording the events
and transactions. It helps in telling the accountants for predicting the methods of accounting
for using it within the given circumstances. Moreover, Chamber’s theory has stated that
imposition of one’s own vies on the others is unscientific and hence, it is preferred for
providing the information about the implications that are expected from the particular actions.
Hence, with the help of this people would be deciding themselves regarding the actions that
they would be taking (Kabir, 2007).
The theory laid down by Chamber are both predictive as well as explanatory and this
theory is prepared for meeting the demand constraints of the users as the extent to which the
values of researcher influences the research design. This theory given by Chamber helps the
company as well as users in making good choices. It is because the choice of method of
accounting is based on the reason of efficiency and current market value. This helps the users
of the company to make the good choice for investments or taking any decision based on this
(Persson & Napier, 2015).
Conclusion
Hence, it is concluded from the analysis that Thomas Kuhn has made the argument
for the episodic model. It has mentioned that the periods of the conceptual continuity in the

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normal science are interrupted by the periods of the revolutionary science. Further, the
discovery of the anomalies during the anomalies in the science helps in leading towards the
paradigms that are new. Moreover, it has been analyzed that R J Chambers has demonstrated
with his logic as well as assumptions that the accounting system that is based on current
market prices or the market selling prices is relevant for the decision-making processes of
users. However, his approaches and logic were highly criticized based on the fact that the
model proposed by the Chamber would not be relied on for providing the knowledge, which
are certain for the actions of future. It does not help for representing the events of past or
present. Therefore, it can be said that every time the new paradigm emerges as the result of
state of crisis whether it is in accounting or any other field.

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“ARCHIVIST'S” REVELATIONS OF 20th CENTURY ACCOUNTING THOUGHT
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