Is Accounting an Information Science?
31 Pages Posted: 18 Jul 2018 Last revised: 3 Aug 2018
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Is Accounting an Information Science?
Number of pages: 31
Posted: 18 Jul 2018
Last Revised: 03 Aug 2018
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Date Written: June 26, 2018
Abstract
The central result is an equality connecting accounting numbers with information. ln (1 ((income)/(assets)))=r_{f} I(X;Y), r_{f} is the risk free rate, ln is the natural logarithm, Y is the outcome of interest, X is the information signal about Y, and I(X;Y) is a Shannon information measure. The equality is derived using economic income accounting; it is shown to hold, under appropriate conditions, for declining balance and straight line depreciation methods. Some social welfare implications are explored.
Suggested Citation: Suggested Citation
Fellingham, John C. and Lin, Haijin, Is Accounting an Information Science? (June 26, 2018). Available at SSRN: https://ssrn.com/abstract=3202973 or http://dx.doi.org/10.2139/ssrn.3202973
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