A methodology for representing authoritative text in accounting: A prototype information system for lease accounting

Users of financial information are faced with the expanding text of Generally Accepted Accounting Principles (GAAP) that is so voluminous and disorganized it challenges human understanding. Billions of dollars in fees are paid each year to Certified Public Accountants (CPAs) for auditing financial statements to test for conformity with GAAP. However, much time is spent by accountants and managers while organizing and retrieving information from accounting standards and other authoritative text. Since the financial statements of many publicly traded corporations must conform to GAAP, this problem is significant. The information overload problem in accounting has been subjected to intensive analysis in the literature. Conspicuously absent from the accounting literature, however, is a solution to the problem from an information systems perspective.; The solution proposed in this study is to investigate a methodology for building an information system for GAAP. The proposed system stores GAAP in an electronic text information base and retrieves it by conceptual area. The dissertation is organized by system development stages with sections addressing domain analysis, logical modeling, physical design, system implementation, and testing. In the early stages of the study, conceptual areas of GAAP are identified, modeled, and organized in taxonomies of accounting concepts that are verified by reviewers. After taxonomy verification, a prototype information system for lease accounting is implemented using the Standard Generalized Markup Language (SGML). SGML tags are programmed to identify the conceptual areas in the text that are defined by the accounting taxonomy. Queried information is retrieved from the text base by electronic tags. As a result, physically fragmented segments of accounting text are linked together by conceptual area. In the study's final stage, prototype system retrievals are tested for conformity with GAAP and compared to a key word search for precision. The prototype system's performance justifies additional investigation of the proposed methodology as a potential solution to the information overload problem in accounting.