Might accounting questions be on-topic?

Question

It appears that the Accounting Stack Exchange Beta failed to launch. Reviewing the business and personal finance stack exchanges, it seems the economics stackexchange is the the best place to ask accounting questions.

Numerous JEL classification codes cover accounting topics including M4 – Accounting and Auditing but also a number of accounting questions fit into corporate finance. The tricky part to admitting these questions is making sure that accounting questions that are more about business administration, legal, taxes, and personal finance than accounting are not posted. Suggestions and different opinions are welcome.

Here are some accounting questions that seem firmly on topic on Economics SE:

1. Depreciating companies intangible assets
2. What is “Stated-capital”?
3. How does depreciation affect the cash flow in a tax-paying company?

Answer 1

I will tend to agree with the OP. My angle is : what would be interesting and useful content and a match to econimics.se, is questions about contrasting/reconciling accounting and economics concepts (usually at the micro level but not only) that sometimes go under the same name. Examples:

• Do accountants mean the same thing as economists when they talk about "profits"? What are the differences? Can the two be reconciled?
• How does the "production function" concept of Economics connect (if at all) to the "Sales/Revenue" item we see in a Profit & Loss statement?
• The most widely used depreciation method in a firm's accounting books is the "Straight-line" method, where a fix proportion of a fixed asset's acquisition cost (historic or re-estimated) is booked as depreciation charge every period. On the contrary, almost exclusively, economic models employ the equivalent of "Declining-Balance" method. Who is more to the mark? Doesn't this create misalignment problems in microeconometric studies?
• Economics employ the concept of "adjustment-costs" in capital investment. Economists treat these costs as non-productive, as a dead-burden to increase the actually productive capital base. But Accounting principles prescribe that most of such costs are booked as an increase to the acquisition cost of the core asset (i.e. not as current expenses). What kind of problems may this create when we look to balance sheet data in order to test an economic theory?
• Public sector finances of many countries are being nowadays presented using the approach and principles of internationally accepted accounting principles (like "Statement of Financial Position", "Cash Flow Statement", etc). In one of these I have seen negative "Cash available" at the beginning of a period. How is this possible? (It is never observed for private companies).
• Also, when assets of a public sector are included in a "Statement of Financial Position", what assets are these? Do they include natural resources owned by the state?

My proposal :

a) Since the Accounting.se site failed to launch, remove "Accounting" from our "Off-topic" guidance.

b) Mention it in the "On topic but" category

either in the "Corporate Finance/Business economics" (with something like "Questions about Accounting theory fall in this category too"),

or separately as

"Accounting Theory: questions about Accounting Theory, especially as regards its relation to Economics may be posted here. Questions about tax legislation, or legal & administrative things that accountants have to deal with as professionals, will be closed as off-topic, and so will questions asking guidance about performing specific accounting tasks."

Answer 2

Now that we do have a list of questions, we can start discussing the matter.

Corporate Finance

Observation: These are all about corporate finance. So why not just include corporate-finance in economics?

If corporate finance, why not finance?

However, the intersection between corporate-finance and economics is pretty small. The intersection between corporate-finance and finance, however, is pretty large. If we were to go this way, it is only consequential to include the whole (academic) finance on this site. This however can only work if we rename into Economics and Finance, or something the like. This would not intersect with the non-academic money.stackexchange, but it would interfere with quant.stackexchange.

Summary

In the end, we are left with two choices:

• Stay Economics-stackexchange
• Become Economics-and-Finance-stackexchange.

Not that im completely against the latter, but we should be aware of what we're doing, and whether and why we want that.