Accounting and the Moral Order: Justice, Accounting, and Legitmate Moral Authority

Relying upon the manner in which accountants speak about their practice, this paper provides an argument that accounting discourse suffers from incoherence. Arguing that accountants speak as if the institution of accounting is part of a moral order, it follows that for accounting to have moral standing it must be capable of providing good reasons for people to conform to accounting directives. Through the work of Baier (1995) and Habermas (1990), the paper describes the nature of a moral order and develops the conclusion that good reasons for accounting rules must be society anchored ones. Two examples are provided that illustrate why considerations of accounting as a deeply moral discourse are important. The first example is the iron law of accountability—which acts to subject people to accounting intrusions that may be unnecessary. The second example is the case of SFAS No. 106. The post-retirement benefits standard is a recent example of the FASB establishing a supra-legal definition of liability by assuming technical capabilities that simply do not exist. The paper concludes with a discussion of how a view of accounting as a system of moral rules may lead to the consideration that the appropriate solution to an “accounting problem” may not always be to extend the technical scope of accounting.