To the layperson, accounting might seem like a carefully structured fixed system used to reflect the financial condition of a company. To University of New Mexico Anderson School of Management Professor of Accounting Joni Young, it is a bird’s nest of often unexamined assumptions.
For example, take stock options. “They do serve a compensatory purpose," Young said. "However they also have a gain sharing purpose in that it does give you ownership and it does lock you into a relationship with an organization for a specified period of time. That particular element of it, when they decided on the accounting, was downplayed.
“There are all sorts of reasons why that might happen, but what was emphasized was the compensatory element of it. Now I am not saying that is incorrect. All I am saying is in deciding to look at one thing, the compensatory, and to ignore other things, shows a certain set of values that are underpinning these choices.”
Young writes about the choices made by the Financial Accounting Standards Board (FASB) in a paper titled “Making up users” published in the journal “Accounting, Organizations and Society.” It was so provocative, it’s been cited hundreds of times by other researchers.
"It is important for us to understand how we got to where we are today so that we can continue questioning whether choices that have been made in the past should still govern how we are going to move ahead into the future.” – ASM Professor Joni Young
She points out the FASB, a private entity that put together the rules for stock options, wanted to justify a reason for requiring specific financial information to be released so they chose to make serving user needs the objective of financial reporting.
“When they talked about the users, they were not talking about flesh and blood readers of financial statements," Young said. "They were talking about this idealized notion of a user and the information this ideal user should want to use."
Questioning the status quo
In Young’s research, she constantly questions the status quo.
In another paper titled, “Constructing, Persuading and Silencing: The Rhetoric of Accounting Standards," Young details how the FSAB goes about mitigating potential criticism of its decisions.
“My research looks at the processes we have developed in order to establish these accounting ‘facts’ and trying to look at the choices that have been made in the past," Young said. "It is important for us to understand how we got to where we are today so that we can continue questioning whether choices that have been made in the past should still govern how we are going to move ahead into the future.”
Young doesn’t look like a revolutionary, but she is indignant about how accounting can be manipulated by those who stand to gain from the manipulation.
“Accounting is used as a justification for closing factories," she said. "Reported results are used as a justification to shift jobs to another country. It is used as a justification in the case of state governments to cut funding for public programs.
"When people who are not familiar with how accounting numbers are put together hear ‘the accounting numbers say we have to…,’ they assume this is a fact. The accounting numbers never say that you have to do anything. It’s just the interpretation that we give those numbers that can be used to justify particular ways of doing things."
Young also collaborates with fellow ASM Professor of Accounting Leslie Oakes on some projects. She and Oakes are interested in the idea of social accountability. They looked at Hull House, the Chicago settlement project that brought social programs and human compassion to some of the poorest neighborhoods in the city in the early part of the 20th century.
Their paper “Accountability Re-examined: Evidence from Hull House” in "Accounting, Auditing and Accountability Journal” was a way to reflect on the idea.
“We were thinking through how that concept of social accountability might help us understand who society has a responsibility to and what the nature of that responsibility is,” she said.
They also collaborated on “Reconciling Conflict: The role of accounting in the American Indian Trust debacle” an article in “Critical Perspectives on Accounting” that examined the role of accounting in mismanagement of Native American trust funds.
They concluded that the Interior's focus on accounting allows Americans of European descent to continue to ignore the contradictions that exist between their (and our) desires to view ourselves and our country as democratic, egalitarian, and ethical.
"Until these contradictions are openly dealt with and allowed to form the foundation for resolving the trust issues, there can be no reconciliation," Young said. "Without this reconciliation, the federal government's handling of the trusts will continue to reflect the chasm between the American ‘is’ and the American ‘ought.’ No amount of accounting can change this.”
A changing perspective
Accounting is commonly viewed as a business process, but Young thinks it's a social process as much as it is a business process. That’s because the information accountants use to explain the finances of a business or a corporation or the nation says so much about the fundamental values of the people.
Young is one of the most productive researchers working in the field of accounting today. Her productivity has been cited in a paper “Benchmarking the Research Productivity of Accounting Doctorates” in the journal “Issues in Accounting Education.”
Currently, Young is interested in examining the underlying assumptions that have contributed to our contemporary understanding of the processes and practices to be associated with generally accepted accounting principles.
Young is an editor for the publication “Accounting, Organizations and Society” and a visiting professor at the London School of Economics.
She teaches intermediate accounting at UNM, a required class for students who studying to be Certified Public Accountants.