Abstract The purpose of this article is to demonstrate that accountants may have some notion of the complexity of the external reporting environment before they conduct rigorous empirical tests. The financial reporting environment appears to be complex since the financial decision-maker must consider the many dimensions of a single bit of information. Conceptual structure refers to an individual's potential to generate new attributes of information and discriminate between stimuli as the number of dimensions he perceives increases. Conceptual level varies for processors in their roles as financial statement users. The financial analyst who can integrate many of the diverse dimensions of financial information demonstrates an abstract conceptual structure while the investor who makes decisions by evaluating only price-earnings ratios demonstrates a relatively concrete conceptual structure. the point of maximum abstractness is constant for all conceptual structures, including the most abstract and the most concrete processors, within the same environment. If this relationship exists for financial reporting as well, the problem of finding the optimal information load appears possible.
Henry Miller (Sat,) studied this question.