Italian accounting has a long and honourable tradition of theoretical
and applied analysis of the accounting and reporting function, perceived
and defined much more broadly than in the Anglo-Saxon tradition. The
high point of this perhaps, is the creation of what is known as Economia
Aziendale (EA). The antecedents, genesis and later developments are
presented here in detail by highly knowledgeable specialists in the
field.
EA takes as a prerequisite the necessity of the business
(entity/azienda) to ensure its own long-run survival. This requires that
the necessary resources are retained and preserved, so operating capital
maintenance, by definition future-oriented, is essential. It requires a
focus on the particular business organization, entity-specific and
consistent with today's notion of the business model. Entity-specific
information relevant to current and future cash flows is a necessary
pre-requisite for ensuring long-run survival, which historical cost
accounting, or fair value (being market-specific not entity-specific)
satisfactorily achieve.
Flexibility of valuation and of reporting, always relevant to the
specific asset at the specific time in the specific place, is a
necessary condition for effective management. This is exactly the focus
of EA and its analysis and tradition. Scholars and advanced students of
international regulation and accounting, as well as accounting history,
will find this an invaluable guide to a vibrant, scholarly tradition of
great practical relevance today.
