THE CONTROVERSIAL ACCOUNTING PRINCIPLES BOARD
by Oscar S. Gellein Partner, Executive Office
Presented before the Conference of Accountants, Tulsa, Oklahoma - April 1971
Let me start with a statement that is very trite. Accounting is in ferment. Ferment is either change itself or a reaction to change. Change has always been a part of the human condition, but the thing we really have not learned how to handle is the accelerated rate of change that surrounds us today.
It is easy to point to the rate of change in scientific development. I read the other day that 1915 marked the median year in the history of scientific development; that is, roughly half of the development has taken place since 1915. For example, one sees figures like this: One-half of all the metals and minerals taken from the earth have been lifted since 1915, one-half of the energy used by man has been used since 1915. It has been asserted that 25 per cent of the people who ever lived are now living. I have not investigated this, but I am confident that 90 per cent of the public accountants who ever lived are now living.
ACCELERATED RATE OF CHANGE
The rate of change around us is so marked that it affects everything we do. The paradox is that we know this, we hear it, and still we do not conduct ourselves accordingly. It seems to be a frailty of man that the human mind cannot project upward along a curvilinear path. Even the most educated and intelligent people project upward along a straight line.
Now you ask what relevance this has to my subject. The mere fact that man knows this but does not act accordingly means that he finds himself at a given point in time at a different place from where he thought he would have been looking ahead from any point in the past. This gap causes what somebody has described as future shock. And so we find people shocked and indignant about things that are being dome in accounting in recognition of change. The Accounting Principles Board finds itself at the mouth of an outpouring of indignation.
One result of the gap insofar as it relates to accounting is that when new