Japanese

ACCOUNTING FORUM2010

No. 18

JAPAN ACCOUNTING ASSOCIATION

Japan Accounting Association.
Liaison Office: Hayashi Building, 1-10 Kanda Nishiki-cho, Chiyoda-ku,
Tokyo 101-0054, Japan
Copyright© 2010, Japan Accounting Association

Japanese ACCOUNTING FORUM 2010
JAPAN ACCOUNTING ASSOCIATIONPREFACEJapanese ACCOUNTING FORUM of the Japan Accounting Association (JAA) is
published annually to publicize academic activities of JAA in English.
The first issue of Japanese ACCOUNTING FORUM was published in 1993. This
edition for 2010 is the 18th issue of Japanese ACCOUNTING FORUM.
This issue contains the summary of presentations at the 68th Annual Conference of JAA
which washosted by Kwansei Gakuin University in Nishinomiya-city on September

2-4, 2009. It also includes the reports of regional activities of JAA during the 2009
academic year.
I sincerely hope that Japanese ACCOUNTING FORUM serves the readers to better
understand the activities of JAA.

Yoshihiro Tokuga
Chairman of the International Committee andManaging Editor of Japanese ACCOUNTING FORUM,
Japan Accounting Association

Contact: Professor Yoshihiro Tokuga
Graduate School of Management
Kyoto University
Yoshida Honmachi, Sakyo-ku,
Kyoto 602-8501, JAPAN
tokuga@econ.kyoto-u.ac.jp

1

JAPANACCOUNTING ASSOCIATION

Board of Directors (2010)
President:
Kazuo Hiramatsu,

Kwansei Gakuin University

Directors:
Kouji Ishiuchi, Kurume University
Tadashi Ishizaki, Chuo University
Kunio Ito, Hitotsubashi University
Kiyotaka Ueno, Chuo University
Akitomo Kajiura, Kwansei Gakuin University
Koji Kurata, Rikkyo University
Yoshinao Kozuma, Sophia University
Shizuki Saito, Meiji Gakuin University
Nobuhiko Sato, Meiji University
Kenji Shiba, Kansai University
Yoshihiro Tokuga, Kyoto University
Fumio Naito, Konan University
Toshiro Hiromoto, Certified Public Accountants andAuditing Oversight Board
Hideki Fujii, Kyoto University
Shuji Mizoguch, Yokohama National University
Masahiro Yurino, Doshisha University2

Japanese ACCOUNTING FORUM 2010

The 2010 Editorial Board
Managing Editor:
Yoshihiro Tokuga,

Kyoto University

Deputy Managing Editors:
Nobuhiko Sato, Meiji University
Editors:
Koji Kojima, Kwansei Gakuin University
Noriyuki Konishi, Aoyama Gakuin University
Akihiro Noguchi, Nagoya University
Norio Sawabe, Kyoto University

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Past Editors of the Japanese ACCOUNTING FORUM :1993 - 1997
Seigo Nakajima, Managing Editor, Ferris University
Yukio Fujita, Deputy Managing Editor, Aichi Gakuin University
Youichi Hara, Ritsumeikan University
Kazuo Hiramatsu, Kwansei Gakuin University
Toshiro Hiromoto, Hitotsubashi University
Yoshiaki Jinnai, Tokyo Keizai University
Yoshihide Toba, Senshu University

1998 – 2000
Nobuo Kamata, Managing Editor, Chubu University
Kazuo Hiramatsu, Deputy Managing Editor, Kwansei Gakuin University
Tokugoro Murayama, Deputy Managing Editor, CPA
Shinji Hatta, Surugadai University
Akihiro Noguchi, Nagoya University
Yasuhito Ozawa, Senshu University
Shigeto Sasaki, Senshu University
Kazumasa Takemori, Chubu University

2001 – 2003
Nobuo Kamata, Managing Editor, Chubu University
Kazuo Hiramatsu, Deputy Managing Editor, Kwansei Gakuin University
Shinji Hatta, Surugadai University
Norio Igarashi, CPA
Noriyuki Konishi, Senshu University
Akihiro Noguchi, Nagoya University
Michimasa Satoh, Nagoya University
Kazumasa Takemori, Chubu University
2004 – 2006
Michiharu Sakurai, Managing Editor, Senshu University
Kazuo Hiramatsu, Deputy Managing Editor, Kwansei Gakuin University
Yukio Sakaguchi, Senshu University
Hironao Iwata, Tokyo International University

4

Past Editors of the Japanese ACCOUNTING FORUM :2007 – 2009
Kazuo Hiramatsu, Managing Editor, Kwansei Gakuin University
Noriyuki Konishi, Deputy Managing Editor, Okayama University
Koji Kojima, Kwansei Gakuin University
Akihiro Noguchi, Nagoya University
Norio Sawabe, Kyoto University
Takashi Yaekura, Hosei University

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JAPAN ACCOUNTING ASSOCIATION

Japanese
ACCOUNTING FORUM
No. 18,2010

CONTENTS
Preface

Yoshihiro Tokuga(1)

Report2009 Annual Conference

Kazuo Hiramatsu(9)

Plenary Sessions
Plenary Session 1: Issues and Prospects of Financial Accounting

Advances in Information Technology and Its Impact on Financial Accounting
Research
Manabu Sakaue (11)Influences on Financial Accounting by Globalization of Economic Activities
Shinya Saito(12)

Takashi Yaekura(13)

Kenji Shiba(14)

Training of Competitive Researchers

Accounting Challenged by New Demands

Plenary Session 2 : Issues and Prospects of Management Accounting
Continuity and Change in Management Accounting:
An Institution Design Perspective
Noboru Harada
6(15)

An Influence of International Convergence of Accounting Standards on
Management Accounting: Firm Performance Measures
Susumu Ueno

(16)

Management Accounting and Innovation:
The Interactive Control That Facilitates Decisions
Kentaro Koga

(17)

Challenges and Perspectives of the Cooperation of Corporate Audit
Yoshimasa Tomosugi(18)

Plenary Session 3 : Issues and Prospects of Auditing

Critical View on Balance-Sheet Audits in Japan
Kunio Chiyoda(19)

Challenges and Future Perspective of Audit Practices Considering the Current
Audit Environment
Satoshi Komiyama (20)Special Committees
A Study on Revolution of Financial Reporting
Yoshikuni Hirose(21)

Study of Decision-Making for Environmental Management and Accounting
SystemKatsuhiko Kokubu(22)

Subject Research Committees
An Inventory of Financial Accounting Research in Japan- Changing International Research Trends – (Interim Report)
Yoshihiro Tokuga

7

(24)

Study Groups
Institutional Basis of Accounting Standards and Current Nature of GAAP
Hideki Fujii(25)

Research on Intangibles from the Perspectives of Management Accounting-Focused on Corporate ReputationMichiharu Sakurai(26)

Regional Reports
Hokkaido Region
Tohoku Region
Kanto Region
Chubu Region
Kansai Region
Kyushu Region

Yuji Yoneyama
Yoshio Hosaka
Shigemasa Kanai
Akihiro Noguchi
Izumi Watanabe
Chikako Ozu

8

(28)
(29)
(29)
(30)
(31)
(32)

2009 Annual Conference of JAA
Report2009 Annual Conference
Chairman of 2009
Annual Conference

Kazuo Hiramatsu
Kwansei Gakuin University
Program
The 68th Annual Conference (2009) of the Japan Accounting Association (JAA)
was hosted by Kwansei Gakuin University on September 2-4, 2009 at Kobe
(September 2) and Nishinomiya-Uegahara Campus (September 3 and 4). The main
theme of the conference was “Issues and Prospects of Accounting”.
On September 2, meetings of the Council and the General Assembly of Membershipwere held at the International Conference Center in Kobe. Soon after those events,
reports were presented by two Study Groups, one Subject Research Committee andtwo Special Committees. The reception was held in that evening at Portopia Hotel,
Kobe.
In the morning of September 3, 12 concurrent sessions including 2 sessions forgraduate students were held. “Korea Session” was also held. “Korea Session” has been
held for these five years based on the tentative agreement by JAA and Korean
Accounting Association (KAA). (From 2010, it will be held as the official activity
based on the exchange agreement signed by JAA and KAA in September 2009. Also
the exchange agreement was signed in December 2009 by JAA and Taiwan
Accounting Association (TAA).)In the afternoon of September 3, three plenary sessions were held under the main
theme of “Issues and Prospects of Accounting” in the area of financial accounting,management accounting and auditing. Following the plenary session, a special open
session was held which was planned outside the official JAA program. Two
distinguished speakers offered presentations on IFRS. The speakers were Professor
Donna Street (University of Dayton, U.S.A., president of IAAER, and Professor
Sidney Gray (University of Sydney, Australia), past president of IAAER.
In the morning of September 4, 13 concurrent sessions including 1 session in
English and 2 sessions for graduate students were held. In the afternoon of September
4, panel discussions of the three plenary sessions were held. Following the panel
discussion, another special panel discussion, which is called ASBJ session, was held9

under the theme of “Issues and Prospects of the Adoption of IFRS”.
More than one thousand members attended this annual meeting and actively
participated in the academic programs.
The schedules of the conference were as follows:

Event
Committee for Officers Election
Committee for New Membership
Screening Committee for Awards
Meeting of the Board of Directors

Date and Time
Sep.1 11:00 – 13:00
12:00 – 13:00
13:00 – 15:00
15:00 – 17:30

Venue
Crowne Plaza
Hotel, Kobe

Meeting of the Council
General Assembly of Membership
Study Group Reports
Subject Research Committee Report
Special Committee Reports
Reception

Sep.2

International
ConferenceCenter, Kobe

Korea Session
Concurrent Sessions
Plenary Sessions
1 Issues and Prospects of Financial
Accounting
2 Issues and Prospects ofManagement Accounting
3 Issues and Prospects of Auditing

Sep.3

Concurrent Sessions
Plenary Panel Discussions
ASBJ Session

Sep.4

10:00 – 12:00
13:00 – 14:30
15:30 – 16:10
16:15 – 17:40
18:30 – 20:30
9:50 – 12:00
9:50 – 12:00

Portopia
Hotel
Kwansei
GakuinUniversity

13:00 – 15:10

10

9:50 – 12:00
13:00 – 15:00
15:30 – 17:30

Kwansei
GakuinUniversity

2009 Annual Conference of JAA

Plenary Session 1:
Issues and Prospects of Financial Accounting

Advances in Information Technology and
Its Impact on Financial Accounting Research
Manabu Sakaue
Hosei University
Extensible Business Reporting Language (XBRL) is a language for the electronic
communication of business and financial data, which is being adopted as a reporting
standard around the world. In 2008, XBRL was introduced to the EDINET systemdeveloped for the Japanese Financial Services Agency, and also to the EDGAR systemdeveloped for the U.S. Securities and Exchange Commission. The XBRL is remarkablethat it provide different perspective, or data modeling against financial statements.
While the impact of information technology for accounting research is relatively
concentrated on the input data or accounting events, how to deal with output data
issues has been left out of consideration so far.
If financial statements are properly modeled, financial information will beseamlessly connected to the following system, so that we can observe financial
information from both supply side and user side. Focusing on the consuming aspect,
we can analyze the process of spread of financial information directly by use ofdifferent research method like social network analysis. We also easily observe theparticular distribution of accounting data, which follow Zipf’s and Benford’s law. It is
known that those characteristics of financial figures can be powerful tool for the fraudaccounting investigation. XBRL and related new information technologies provide
new research perspectives, therefore it deserves continued attention.

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Influences on Financial Accounting
by Globalization of Economic Activities
Shinya Saito
Yokohama National University
Because of globalization of economic activities, a movement toward international
convergence of the accounting standards used in capital markets is accelerating
focusing on International Financial Reporting Standards (IFRS) today. Needless to say,although IFRS are for preparing consolidated financial statements, calculating tax baseis depend on individual financial statements. But individual financial statements are
influenced by the convergence.
Perhaps IFRS will be the standards for useful information in order to makeinvestment decision. However, it is not appropriate standards for calculating tax baseand dividend base. Therefore the movement produced a serious problem in countries
like Japan; in such countries, accounting standards organically connected with othersocial systems. Especially for calculating tax base, IFRS include unsuitable standards(e.g., standard for parts of financial instruments).
To this problem, the following solution is proposed. That is; at first, IFRS will beapplied only to consolidated financial statements, and then applied also to individual
financial statements after a fixed period (the device of consolidated statements –precedence; the dynamic approach). By the device、the double standards problems
arise in the fixed period.
Then, in the place of the device, the followings should be considered.
・Application of IFRS for public companies' statements.
・Application of IFRS(simple and easy version) greatly for private companies’
statements, or exemption regulations for them.
・ Abolition of "the condition of accounting for calculating net income” incalculating taxable income on the corporate tax law.
Finally, it should be emphasized, that the social role imposed on financial
accounting study is the presentation of the coordinate, which can clarify the meaningof the information in the situation that the accounting standards convergedinternationally.

12

Training of Competitive Researchers
Takashi Yaekura
Hosei University
This presentation deals with the issue of how to train competitive researchers.
It was prepared to answer to the doubts raised by the Science Council of Japan (SCJ).
SCJ doubts if social ‘science’ in Japan, including accounting, actually belongs toscience.
I share the doubt because the current state of Japanese accounting literature completely
lacks competitiveness and ignores scientific method.
First, I demonstrated how the doctoral students in accounting are trained in the U.S.,
using the Ph.D. program at the University of Illinois as an example.
Second, I argued that the following four initiatives must be taken in Japan so that
doctoral students in Japan become competitive.
・Emphasis on research methodology based on the understanding of the philosophy ofscience.
・Standardizing the core knowledge of the literature.
・Developing the education system which promotes the extended reproduction ofknowledge.
・Differentiation of research output by utilizing the accumulated literature innormative studies.
In addition, I proposed to demolish the master’s thesis and reeducation of existingaccounting educators. The reason for demolishing the master’s thesis is that it is rather awaste of precious time of doctoral students. The reason for the call for reeducation isthat the existing accounting educators do not possess the necessary knowledge to train
competitive researchers.

13

Accounting Challenged by New Demands
Kenji Shiba
Kansai University
As well as changes in the economy cannot be controlled, progress in scienceand technology does not necessarily mean a more comfortable human life.
If accounting makes the same mistake as in human life, of having an excessive faith inscience and technology, we should pay attention not to lose sight of the truth.
The classification of accounting in financial and managerial is now being substitutedby the one focusing on accounting for the public interest and for private interests. I
think it is necessary to change our minds considering that “public companies
participating in the global capital markets should be regulated from the viewpoint of
the public interest”.
How should education keep up in an accounting world moving to standardization?
As accounting searching for the public interest, the need for regulation and the required
standard should be taught. That is, IFRS should be taught as an issue in regulationaccounting. Financial reporting of giant enterprises should be considered as an issue of“public accounting”.

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2009 Annual Conference of JAA

Plenary Session 2:
Issues and Prospects of Management Accounting

Continuity and Change in Management Accounting:
An Institution Design Perspective
Noboru Harada
Tokyo University of Science
This paper conceptualizes and interprets the dynamic change process inmanagement accounting practices from an institution perspective. Institution has twomeanings as follows.
First, the institution keeps practices continuously stable as the habits which produce
individual or collective practices through the conformation of present practices to
products of past experiences. These habits are systems of mental dispositions to be
self-actualized in structured practices over a long time, formed in fields such as groupwith homogeneity as well as in individuals. Each member in fields will internalize andaccept hierarchic order in fields as taken for granted, and unconsciously select arule-dependent action.
Secondly, the institution transforms old practices into new ones. Rational action
may generate irrational and unexpected economic consequences. Then the shift ofinstitution itself and environmental conditions or executive’s action will trigger change
in practices. The changed institution accommodates the evolution and revolution inpractices caused by variations and mutations respectively.
In final, an executive’s autonomous actions may have a significant influence on theeconomic consequence contingent upon external and internal environments, andcontribute to change of practices. Therefore institution design can consciously build
management accounting in Japanese style focused on collective cooperation withhomogeneity, in the Western style that takes individual skill and knowledge inorganization with heterogeneity in account, or in new integrated type. As a result, thisdesign may give a new direction and implication for studying the change process inmanagement accounting.

15

An Influence of International Convergence of Accounting Standards
on Management Accounting: Firm Performance Measures
Susumu Ueno
Konan University
International convergence of accounting standards has changed concepts andpresentations of periodic firm performances. This study examines the influence ofchanges in reported income on management accounting as a result ofinternationalization of accounting standards.
The initial part of the study examines the recent development of international
convergence and adoption of accounting standards in Japan, U.S., and European Union,
after which income as defined under both US and International Standards is comparedwith the Hicks’ economic income. The comparison showed that these standards
preferred the asset-liability view over the revenue-expense view in calculating firms’
reported income. The accounting standards have been shown to employ the“mixed-attribute” model in evaluating assets and liabilities until today. An increased
utilization of fair value measurements has also been observed.
Fair value methods recognize value changes of assets and liabilities during eachholding period. However, it should be noted that the amount recognized in a period isonly temporary and is subject to changes in later periods. The broader utilization of fairvalue therefore amplifies volatilities of reported income numbers.
The above two accounting standards mandate the disclosure of multiple incomes inperiodic performance reports. The disclosure satisfies different information needs ofdifferent stakeholders. The best surrogate for a top management’s periodic
performance is the comprehensive income. This is because the other comprehensive
income items do capture value changes caused by exposure risks for which the top
management should assume full responsibility.
Asset-Liability view expands scopes of asset and liability recognition and enhances
utilization of fair value measurements. This study discusses accounting for in-process
R&D and internally-generated intangible assets in the context.
The final discussion focuses on the influence of international convergence ofaccounting standards on management accounting research. The whole ethos of the
discussion clarifies that cross-cultural management accounting studies could enjoy
parsimonious specifications when all listed-companies throughout the world use a
uniform standard after the full-adoption of IFRS.
16

Management Accounting and Innovation:
The Interactive Control That Facilitates Decisions
Kentaro Koga
Hitotsubashi University
In its decision facilitating function, the accounting information often does not
identify the best decision because the accounting information allows more than one
interpretations. For example, the sales decline may indicate the drop in demand, which
commands to reduce future investments. At the same time, the sales decline may
indicate poor execution of business strategy, which requires increasing future
investments to improve the execution. The interactive control, the group innovation
process that combines the tacit knowledge from various business functions, can help
the manager to reach the most reasonable interpretation and, consequently, the best
decision. Management accounting literature, however, has not empirically documented
whether and how the interactive control actually leads to innovation. Social
psychology studies explore brainstorming that resembles the interactive control to findthat brainstorming hinders innovation, not enhance it. In brainstorming, the free-rider
problem and the illusion of high group performance reduce the participants’ efforts togenerate innovation. The problems can be removed by the group composition fromdiverse backgrounds and a specific and challenging goal. Management accounting
studies should empirically investigate whether these mechanisms also improve thegroup innovation process of interactive control through which the accounting
information facilitates the decisions.

17

2009 Annual Conference of JAA
Plenary Session 3:
Issues and Prospects of Auditing

Challenges and Perspectives of the Cooperation of Corporate Audit
Yoshimasa Tomosugi
Waseda University
I reported the problems of the cooperation of corporate audit in Japan. Big company
is either capital 500 million yen or liability 20 billion yen and necessary to set up boardof directors. Public company is no limit of sale or purchase of stocks and subject toaccounting audit by certified public accountants (CPA). Big company and publiccompany are about 4,000 in Japan. The auditor is corporate auditor (or audit
committee), internal auditor and CPA. The necessity of total audit is explained by audit
standards and guidelines. To effective audit, each auditor must have the cooperation
with another auditors positively to have communication or exchange opinion.
Corporate auditor is not necessary to have license, but if one or more corporate
auditors have knowledge of finance or accounting, the fact is disclosed. I researched
the cooperation of corporate audit in terms of economy, efficiency, effectiveness. There
are the problems of (1)the valuation by corporate auditor to audit judgement by CPA ,(2)the advice or announcement of facts of illegal act and fraud, (3)the dissolution ofperverce incentive between board of directors and CPA. Now, in the audit environment,
we must advance the direction to recognize Convergence and Adoption to International
Standards on Auditing.

18

Critical View on Balance-Sheet Audits in Japan
Kunio Chiyoda
Kumamotogakuen University
In Japan, majority views say that American audit style before Securities Acts (1933,34) is the Audit for Bankers by accountants. They also assert that American public
accountancy was developed by this style of audits before 1930. But we can’t find thosefacts in the American literature. In other words, we have great difference between thetwo countries.
This is the reason why in Japan a famous and authoritative professor had mistaken
Stephen Gilman, Accounting Concepts of Profit, The Ronald Press Co., 1939. andthat following professors has adopted his view without due consideration.
Author discloses the fact that in US Audit for Bankers were not developed
extensively. Instead, financial statement audits in annual reports were adopted
steadily. He depends on the Commercial & Financial Chronicle for 50 years, editorials
of Journal of Accountancy for 30 years and public accountants office histories
including Big 8.
This vast research exceed the results of Roger Barton, “Independent Audits for
Investors,” The Journal of Accountancy, August 1933, pp.91-101. and Richard
Vangermeersch, Financial Reporting Techniques In 20 Industrial Companies Since
1861, University of Florida, Accounting Series No. 9, University Press of Florida,
Gainesville, 1979.

19

Challenges and Future Perspective of Audit Practices Considering
the Current Audit Environment
Satoshi Komiyama
CPA
Emerging audit issues considering the current changes of the audit environment
have been reported.
Examples of impact to audit practices resulting from the financial and economiccrisis are fair value measurement of financial instruments, unfunded status of
employees benefit plans, collectability of deferred income tax assets, and consolidationof SPE.
Recent changes to financial reporting requirements have also significantly impacted
audit practices. Quarterly financial reporting and audit of internal control have alreadystarted, and new accounting standards developed under convergence programs withIASB as well as the possibility of adopting IFRS will also have significant impact in
the future. The recent trend of requiring expanded information in notes to financial
statements will change the quality of financial information.
Examples of impact resulting from regulatory environment include the second
amendment of CPA Laws which require strengthened quality control systems,
governance and independence. This amendment had significantly impacted the audit
practices of small and medium size audit firms as well as the large audit firms. The
planned amendment of auditing standards responding to results of the ISA clarity
project will impact audit practices. Audit requirements in various areas are expanding,and developing auditing standards as well as defining assurance risk in new areas will
be new issues.
Examples of plans responding to those challenges in audit practices include
intensifying training programs in audit firms, improving audit methodology foraccounting estimate including fair value, developing audit methodology for narrative
information disclosure, and developing auditing standards which can be applied toentities such as non-profit entities, public sectors and new audit areas.

20

2009 Annual Conference of JAA
Special Committee
A Study on Revolution of Financial Reporting
Chair: Yoshikuni Hirose
Waseda University
In the Final Report, based on the findings in the Interim Report, we sought new
systems to improve the reporting system and measurement system to bringnon-financial information, which explains value drivers, into accounting fields.
We found the key to the solution in the scheme of EBR (Enhanced Business
Reporting), which improves financial reporting, and discussed it in detail. As a result,
we revealed that the EBR was not only different from this Special Committee’s
approach to regard financial reporting as the final chapter in accounting, but also had
issues at this point such as not having established a model to calculate concreteEnterprise Values.
In aiming for fundamentally resolving these issues, we attempted to propose andpublish to the world the EFR (Enhanced Financial Reporting), a Japanese version of
EBR, in the Final Report.
More specifically, we established the “Cockpit Model” as an example of Enterprise
Valuation model inherent in the EFR, proposed the Reporting Map in financial
reporting by visualizing Enterprise Values which indicates the points where Enterprise
Values are created and enhanced, and summarized basic concepts of the EFR which areconsidered useful in studying the revolution of financial reporting in the future.
The Final Report has several notable features; first, it proposes Japanese version offinancial reporting model which is not a carbon copy of ones in Europe or in the
United States; second, it develops discussions not only from the viewpoint of externalreporting (i.e., financial accounting), but also from the viewpoint of internal reporting(i.e., management accounting); third, it performs empirical studies based on precedingstudies to demonstrate usefulness of non-financial information and to examine the way
financial reporting should be improved; and fourth, it identifies basic concepts offinancial reporting which include ones difficult to be incorporated into the system in
the near future and ones totally not to be incorporated into the system, taking a
different approach from the conceptual framework which assumes the establishment of
21

the system or accounting standards.
In the Final Report, we also discussed the limitations and future directions of theaforementioned EFR in the end.
Members of Committee：
Yoshikuni Hirose, chairman (Waseda University)
Young Duke Hah (Waseda University)
Michimasa Hamamoto (Yokohama National University)
Yasuhito Hanado (Waseda University)
Koji Kurata (Rikkyo University)
Yasunori Matsui (Rikkyo University)
Shuji Mizoguchi (Yokohama National University)
Wataru Nagatsuka (Fukuoka University)
Fumio Naito (Konan University)
Ryuichi Nakajima (Meikai University)
Hiroshi Obata (Hitotsubashi University)
Masashi Okumura (Waseda University)
Tomoki Oshika (Waseda University)
Chika Saka (Kwansei Gakuin University)
Nobuhiko Sato (Meiji University)
Kazuyuki Suda (Waseda University)
Kazumi Suzuki (Kobe University)
Kazuo Takeda (Sugiyama Jogakuen University)
Tsuyoshi Watanabe (Fukuoka University)
Masao Yanaga (Tsukuba University)
Yuji Yoneyama (Hokkaido University)
Shiko Yun (Aoyama Gakuin University)

Special Committee
Study of Decision-Making for Environmental Management andAccounting System
Chair: Katsuhiko Kokubu
Kobe University
The objective of this committee is to study accounting systems useful inenvironmental management decision-making from the perspective of both management22

accounting and financial accounting, in order to develop specific accounting
techniques. Global environmental problems are considered to be the biggest challengesof the 21st century, and achieving compatibility between the environment and theeconomy is essential for resolving these problems. As the economic calculation
systems of companies, accounting systems have a central role in achieving
compatibility between the environment and the economy. For this reason, it isnecessary to identify specific environmental management decision-making and clarify
the methods with which accounting systems can contribute to this decision-making andthe challenges they still have to overcome.
Environmental management decision-making is carried out by people withincompanies but at the same time people outside the companies also carry it out in theform of valuations of the companies, so cooperation between these two groups isimportant. This committee placed importance on both of these perspectives, andcarried out in-depth and separate studies of “accounting systems that support theenvironmental management decision-making of companies” (Part Ⅰ) and “accounting
systems that support the environmental management decision-making of society andthe economy” (Part Ⅱ)
In the committee’s examination of “accounting systems that support theenvironmental management decision-making of companies,” it analyzed theenvironmental measures in the core management systems of companies, including
environment-conscious production, environment-conscious operational improvements,
design for environment, environmental capital investment, environmental performance
evaluation, etc., and elucidated the role of accounting systems in each of these phases.
Moreover, it performed studies of new areas such as green supply chain management,
environmental externalities management, etc.
In the committee’s examination of “accounting systems that support theenvironmental management decision-making society and the economy”, it examinedthe effectiveness of accounting systems in new areas related to society and theenvironment such as CSR management, regional development, etc., with the focus onstudies of the environmental management decision-making areas that are mainly facedby companies and investors, such as responsible investment, the development of“eco-indicators”, emissions trading, pollution cleanup activities, etc. Moreover, it
performed studies of the relationship between environmental accounting and the public
interest. Finally, it added a survey of the literature on environmental accounting fromthe past 20 years as a reference.
The interim report identified the problem areas for each kind of accounting system,
clarified the directions in which the roles of accounting systems are moving. In thenext fiscal year the committee plans to elucidate what kinds of environmental
management decision-making can be supported by accounting systems in each of theabove two areas, primarily using experimental studies and case studies.
23

Subject Research Committee

An Inventory of Financial Accounting Research in Japan- Changing International Research Trends –(Interim Report)
Chair: Yoshihiro Tokuga
Kyoto University
This Subject Research Committee of the Japan Accounting Association wasorganized in September, 2008. We have set two main tasks as our goals. One is to
do an inventory of the financial accounting research available in Japan and from this tochart its historical changes and characteristics. The other is to take it a step further
and make a contribution to the future progress of Japanese financial accounting
research by identifying strong and weak areas, as compared to international standards(though international standards are not the only criteria used to judge quality) while
keeping the good characteristics, with the aim of improving our international
competitiveness. This year, we have focused on the first task, especially thedevelopment of classification criteria, while laying the foundation for the second task.
For the inventory of the research, a classification method needed to be agreed upon.
However, there are no internationally accepted rules for the classification of accounting
research. We thus assumed several classification criteria; the research subject,research method, and research object etc. We discussed what the criteria for ourclassification should be and if we should plot research papers on multiple axes (multidimensional classification) or if the axes should be applied in steps. We repeatedly
improved on our chosen classification method by considering ongoing feedback fromthe application of sample research papers.
In our search for an axis for the first stage classification for our "research method,"
through trial and error, we came up with the following categories. 1. Analytical
Research and Methodology, 2. Empirical Research, 3. Normative and Descriptive
Research, 4. Historical Studies, 5. Case Studies, and 6. Miscellaneous. To follow thisstep, we adopted the "research object" as the second axis for the next stage ofclassification.
In a pilot study, we classified 538 research papers; those published every 5th year in
the Journal "Accounting" from 1978 for a period of 30 years. We found in all sample
years that normative and descriptive research are responsible for more than 50 % of all24papers and that "Analytical Research and Methodology" and "Historical Study" tended
to decrease, while "Empirical Research" tended to increase.
Next year, the final year of this committee, our job will be to finalize the report, to
add papers from Accounting for the blank years, and to extend our research to otherjournals in order to remove the sampling bias. In this second year, we will work on
our second goal, which is to propose a way of improving the weaker areas whilebuilding on the stronger areas. We also plan to suggest criteria for evaluating thequality accounting papers, drawing on related research areas such as economics andlaw.

Study Group
Institutional Basis of Accounting Standards andCurrent Nature of GAAP
Chair: Hideki Fujii
Kyoto University
We have been observing radical changes in accounting and its related systems sincearound the beginning of the new century; e.g., convergence of accounting standards,
proposals of (full) fair value accounting, coming into effect of new internal auditing
rules stipulated by Sarbanes-Oxley Act in the U.S. and by Financial Instruments andExchange Act (JSOX) in Japan and so on. We can point out two features among others
concerning these system changes. First, they have, in common, obstinate orientation
toward uniformity in regulation by eliminating the room for managers’ latitude frompractice as far as possible. Second, these changes are made up on the completely
different basis from traditional GAAP widely imbedded in practice.
But accounting rules should be generally accepted, if they are to be established as asocial institution. For this, the practice based on the rules should substantially spreadover the society. Any accounting functions couldn’t be carried out without practice. In
this sense, accounting rules are fundamentally autogenous.
Do the new accounting rules mentioned above have this kind of general acceptance?
Our purpose is to reconsider the nature of the new accounting standards, especially
IFRS and SFAS, and to analyze what eventually makes them social and/or global rules.
We tentatively concluded, in our interim report 2009, that substantial authoritative
support is getting even more indispensable for accounting rules to become ingredientsof GAAP. To this extent, the notion of GAAP, originally autogenous and descriptive,
has been taking heterogenous and normative character.

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Study Group
Research on Intangibles from the Perspectives ofManagement Accounting-Focused on Corporate ReputationChair: Michiharu Sakurai
Josai International University
A study group titled Research on Intangibles from the Perspectives of Management
Accounting was established at the annual meeting of JAA held on September 2008.
This paper is a short summary of our interim report, Research of Management
Accounting on Intangibles, focused on Corporate Reputation. The report was
published on September 2009. Members of the committee are listed at the bottom of
this paper.
The interim report divides intangibles into two categories: one is intellectual and theother is reputation-related intangibles. Intellectual intangibles include innovation and
R&D, computer software, intellectual properties, human, information & organizational
assets. Reputation-related intangibles include brand and corporate reputation. The mostpromising intangibles for the research of management accounting are believed to becorporate reputation because it is relatively easier for management accountants tomanage corporate reputation than other intangibles such as brand. The study group
adopted the definition of intangibles defined by Brookings Institution: Intangibles aredefined as nonphysical factors that contribute to or are used in producing goods orproviding services, or that are expected to generate future productive benefits for theindividuals or firms that control the use of those factors.
At the annual meeting of JAA, five members presented their short presentation.
Professor Sakurai presented a summary of the report. Professor Uchiyama talked abouthuman resources management. Professor Kozakai reported on information assets
management. Professor Arae discussed organizational assets management. Lastly,
Professor Aoki analyzed perception of Japanese managers on corporate reputation andreputation management based on the survey by questionnaire that was carried out for
managers whose companies are listed on Tokyo Stock Exchange.
Chairman of the Committee; Michiharu Sakurai (Josai International University)
Committee members; Akimichi Aoki (Senshu University), Takayuki Asada (Osaka
University), Takashi Arae (Nihon University), Kazunori Ito (Senshu University),
26

Yoshihiro Ito (Waseda University), Hironao Iwata (Senshu University), Akihiko
Uchiyama (Chiba University), Asako Kimura (Kansai University), Masakazu
Kozakai (Tamagawa University), Tomoaki Sonoda (Keio University), Yoshiomi
Someya (Josai International University), Akiko Iwabuchi (Tokyo Management
College)
Discussants; Junya Onishi (MOF), Kyoko Kanesaka (Dentsu ), Norio Sawabe (Kyoto
University), Hidetoshi Takaba (Syuwa accounting firm), Kazuhiro Mawatari(Dentsu)27

2009 Annual Conference of JAA
Regional Reports
Hokkaido Region
Yuji Yoneyama
Hokkaido University
The regional meetings were held in 2009 as follows.
1. The 75th Regional Meeting at Tomakomai Komazawa University on May 23rd,
2009.
(1) “Accounting for Complex Capital Structure”, Hideaki Kuramoto,Hokkai-Gakuen University.
(2) “Gradual Progress of the Amendment to IAS19-Employee Benefits”, Akiyoshi
Miyakawa, Sapporo University.
(3) “Accounting Education and Qualifying Exams of Bookkeeping: A Survey
Research in a University”, Satoshi Hatamoto, Otaru University of Commerce.
(4) “The Problems of Consolidation Standard in Japan: In Convergence with
IFRS”, Kouichirou Matsumoto, Hokusei Gakuen University.
2. The 76th Regional Meeting at KKR Hotel Sapporo on November 7th, 2009.
(1) “A Study of the Practical Use of Capital Investment Analysis Methods inJapan: The Multiple and Flexible Use of Methods by Japanese Companies”,
Tomonari Shinoda, Hokkaido University.
(2) “Convergence of Chinese Accounting Standards: A Strategic Perspective”,
Lanlan Shao, Sapporo Gakuin University.
(3) “Issues of Internal Control Report System and the Way Accounting Disclosure
System Ought to Be”, Katsuyuki Kanda, Hokkaido University.

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Tohoku Region
Yoshio Hosaka
Tohoku Gakuin University
The Tohoku Region of the Japan Accounting Association covers the north eastern(Tohoku) area of the main land.
In 2009, following two meetings were held.
(1)The 76th Meeting at Tohoku Institute of Technology on May 30th, 2009.
(1) “An Empirical Study of the Effect of Accounting Firms’ Consulting Services
for J-SOX in Japan”, Dairiki Ko, Ph.D Candidate, Graduate school of Business,
Tohoku University.
(2) “Variance Deployment of Revenue in Fixed Revenue Accounting”,
Kosuke Matsuoka, Tohoku Gakuin University.
(2)The 77th Meeting at Aomori Public College 0n November 21st, 2009.
(1) “Post Earnings Announcement Drift; Evidence in the Japanese stock markets”,
Naohiko Matsumura, Tohoku Gakuin University.
(2) “A Study in the Transition and Direction of Empirical Research on Intangible
Asset Accounting”, Keikichi Kato, Hirosaki Univeristy.

Kanto Region
Shigemasa Kanai
Bunkyo Gakuin University
The 57th regional meeting was held at Bunkyo Gakuin University on December 5th,
2009. The main theme of the meeting was “Problems Surrounding Revenue
Recognition Standard”. Discussions were coordinated by Eiko Tujiyama, Waseda
University.
Following reports and panel discussions were presented.
(1)“Problem Concerning an IASB･FASB “Revenue Recognition” project”,
Katunobu Mandai, Hitotubasi University.
(2) “Problem Concerning a Revenue Recognition Standard and a Conceptual29

Framework”, Yoshinori Kawamura, Waseda University.
(3) “Problem Concerning a Revenue Recognition Standard and Audit”, Satoshi
Komiyama, KPMG AZSA&Co.
(4) “Problem Concerning a Revenue Recognition Standard and an Accounting
Practice”, Hideto Watanabe, Shimizu Corporation.

Chubu Region
Akihiro Noguchi
Nagoya University
The 120th Regional Meeting at Kanazawa University on April 18th, 2009.
1.“Real versus Accounting Manipulation on Earnings Management”, M Tazawa,
Meijo University.
2. “The Explanation of Ledger Records Based on the Events Theory”, S
Takeshima, Kanazawa University.
The 121st Regional Meeting at Chubu University on July 11th, 2009.
1. “International Movement toward Electronic Disclosure”, Hitoshi Abe, Chubu
University.
2. “Financial Reporting for Islamic Banks in Malaysia”, Osamu Matsuda, Nagoya
Sangyo University.
3. “Purpose of Financial Statement Presentation and the Statement of Cash Flow:
Issues Related with the IASB Discussion Paper”, Hideki Endo, Tokai Gakuen
University.
4. “The IASB/FASB’s Framework on Revenue Recognition and the System ofDouble-Entry Bookkeeping”, Tsukasa Nishidate, Mie Chukyo University.
The 122nd Regional Meeting at Nagoya University of Commerce and Business(Fushimi Campus) on December 5th, 2009.
Theme: The Results of Empirical Research and the Facts in Accounting PracticeModerator: Akira Kobashi, Nagoya University of Commerce and Business
1. “Earnings Management in Acquisitions through Stock Deals in Japan”, Kensuke
Yabe and Yasuharu Aoki, Nagoya University of Commerce and Business.
2. “Empirical Evidence of Effect by the Introduction of IFRSs in Germany”, Ko
Tan, Nagoya University.
3. “Introduction of Defined Contribution Pension Plans and Earnings
30

Management”, Kazuo Yoshida, Nagoya City University.
4. “Issues on Acquisitions through Stock Deals in Japanese Accounting Practice”,
Kazuo Matsuoka, CPA.

Kansai Region
Izumi Watanabe
Osaka University of Economics
The 59th Kansai regional meeting of The Japanese Accounting Association (JAA)
was held at Osaka University of Economics on December 19th, 2009. The main
theme of the meeting was “The essence of accounting will have to be considered again– from the Theoretical, Historical and Empirical Approaches.” These three
approaches were presented by Professor Yoshihiro Tokuga (Kyoto Univ.), Professor
Hidetoshi Yamaji (Kobe Univ.) and Tatsuo Inoue (Kwansei Gakuin Univ.).
In
addition to these main presentations, we had a speech “Doing qualitative research inmanagement accounting - why, how, and where” by a guest speaker, Professor Wai
Fong Chua (senior associate dean of the Australian Business School, University of
New South Wales, Australia).
Before the main session, we had interesting reports in three parallel sessions by
nine young researchers, Yu Wang (Osaka Seikei University): “Chinese
GAAPs―What’s a Role of IFRS in BRICs―”, Koji Okino (Hyogo University): “TheNew Accounting Regime of UK GAAP: A Three Tiers Approach by UK ASB's
Proposals on August 2009, Tomomi Shiosaki (Hiroshima City University): “Applying
IFRS for Individual Accounts: Evidence from Germany”, Noriaki Miyatake (Osaka
University of Economics): “A Study on Problems of Missions Trading Schemes”,
Takashiro Shinso (Doshisha University): “The Great Depression and Accounting forInvestment Securities in U. S. Commercial Banks”, Yumiko Sankoji (Matsuyama
University): “A Historical Study of Accounting in 14th century France: Before theIntroduction of Double-entry Bookkeeping in France”, Hirofumi Asada (Kyoto
University): “Analytical Frameworks in Management Accounting Change Study”,
Kousuke Shiomi (Hiroshima University): “On the Application of a Design Structure
Matrix to German Cost Accounting System” and Tsuyoshi Sato (Hiroshima
University): “A Study on the Application of Balanced Scorecard to the Local
Government― Comparative Analysis between a Framework in Japan and U.S. ―”.

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Kyushu Region
Chikako Ozu
Kyushu University
The Japanese Accounting Association (JAA) Kyushu regional conferences are
regularly held two times a year – in early August and late March. This year, thesummer conference was organized at Nakamura Gakuen University in Fukuoka cityand the early spring conference was assembled at Kurume University. The title of
topics and name of the presenters at each of the meetings are shown below:
1. The 84th meeting held at Nakamura Gakuen University, on 1st August, 2009.
(1) The Recent Development of Financial Reporting, Miho Nakamura, Oita
University(2) On the Income Determination Basis in Commercial Code, Shigeru Hirakawa,
Kinki University(3) The Development of Control Chart System in Dupon Co., Shin’ichi Korogi,
Kurume University(4) Some Issues in Tax Law Accounting in Japan, Hideo Suenaga, Kumamoto
Gakuen University
2. The 85th meeting held at Kurume University, on 27th March, 2010.
(1) An Investigation on the Development of Target Costing and its Diffusion in
1950’s in Japan, Okihiro Maruta, Kyushu University(2) An Inquiry into Neutrality Criteria in Recent Auditing Standards in the U.S.,
Akira Nin, Kita Kyushu City University(3) Questioning of Trial Sheet Equation in High School Textbook, Masahiro Ota,
Fukuoka University32