Abstract This article discusses the potential and actual relevance of academic research to the accounting standard setting process. In accounting standard setting, the instances of interest and the matters at issue are proposed accounting rules that specify either recognition practices or disclosure practices or both, along with a set of measurement rules or guidelines. The idea of bringing evidence to bear implies that policy-relevant research will tell the standard setter something about a proposed standard which will shift his beliefs about that proposal. Standard setters ultimately must answer a normative question: should a given item be disclosed; if the answer is yes, then should the item be recognized or placed in the notes. In either case, the standard setter must also specify when in an ongoing economic process disclosure or recognition should occur and he must provide measurement rules or at least measurement guidelines. The descriptive or explanatory nature of much academic accounting research means that a person wishing to use such research to settle a normative issue must supply a normative criterion, since the research in general does not.
Katherine Schipper (Thu,) studied this question.