About the Authors xiii
Preface xv
1 Introduction to Applied Professional Research 1
What Is Research? 2
Research Questions 3
Nature of Professional Research 5
Critical Thinking and Effective Communication 6
Economic Consequences of Standards Setting 7
Role of Research in the Accounting Firm 7
Skills Needed for the CPA Exam and Practice 9
Overview of the Research Process 10
Step One: Identify the Relevant Facts and Issues 11
Step Two: Collect the Evidence 12
Step Three: Analyze the Results and Identify the Alternatives 12
Step Four: Develop a Conclusion 13
Step Five: Communicate the Results 13
Data Analytics/AI in Accounting and Auditing Research 14
Summary 15
Discussion Questions 16
Exercises 17
2 AI’s Impact on Accounting and Auditing Research 18
Brief History of AI 19
Emergence of Generative AI 20
Large Language Models (LLMs): Development and Types 20
Limitations and Ethical Concerns of LLMs 21
Hallucinations in LLMs 21
Performance Limitations 22
Biases in Training Data 22
Ethical Concerns and Responsible Use 22
Legal Considerations 22
Lack of Transparency 23
Applications of Generative AI 24
Text Generation Translation and Summarization Through LLMs 24
Significance of User-Friendly Interfaces in LLM Accessibility 25
Revolutionizing the Accounting Landscape 25
Effective Prompts Engineering 26
General Tips for Prompt Engineering 26
Engineering Prompts for Accounting 27
Current Regulations of AI 29
Summary 30
Discussion Questions 30
Exercises 31
3 Critical Thinking and Effective Writing Skills for the Professional Accountant 32
Critical Thinking Skills 32
Levels of Thinking 34
Universal Elements of Reasoning 37
An Example of Using Critical Thinking Skills 38
Effective Writing Skills 39
Writing as a Process 40
Punctuation Primer 41
Improved Writing Skills Required 41
Active Voice 43
Short Sentences 43
Definite Concrete Everyday Language 43
Tabular Presentation 44
Limited Jargon and Technical Terms 44
No Multiple Negatives 44
Elements of Plain English 45
Writing Effective Texts e-mails and Letters 45
Writing Memos to the File 46
AI’s Impact on Communication 48
Summary 48
Discussion Questions 49
Exercises 49
4 The Environment of Accounting Research 52
The Accounting Environment 52
The SEC and the Standard-Setting Environment 53
Rules-Based vs. Principles-Based Accounting Standards 55
Financial Accounting Standards Board 56
FASB Strives to Simplify Standards 57
Content of Authorities 57
FASB Due Process 59
FASB Conceptual Framework Project 61
Statements of Financial Accounting Concepts Nos. 1–8 61
American Institute of Certified Public Accountants (AICPA) 62
Governmental Accounting Standards Board 63
Other Organizations Influencing Standard Setting 65
U.S. Generally Accepted Accounting Principles (U.S. GAAP) 67
The FASB Accounting Standards Codification TM 68
Using Authoritative Support 69
Reading an Authoritative Pronouncement 70
Accounting Choices Have Economic Consequences 72
AI and Standard Setters 72
Summary 73
Discussion Questions 73
Exercises 74
5 Financial Accounting Research Tools 76
Accounting Research Online 77
Database Research Strategies 77
Step One: Define the Information Needed 77
Step Two: Determine the Sources to Search 77
Step Three: Use Appropriate Search Methods 78
Step Four: View the Results and Manage the Information 78
Step Five: Communicate the Search Results 78
FASB Accounting Standards Codification TM Research System 78
The Research Process 80
Locating U.S. GAAP Using the Codification 83
Examples Using the Codification 84
SEC Accounting for Public Companies 85
SEC Regulations and Sources 86
The SEC’s Published Views and Interpretations 86
SEC Staff Policy/Interpretations 87
Accessing SEC Filings and Regulations 89
Cases to Practice Accounting Research 91
Data Analytics and AI for the Accounting Researcher 92
Summary 94
Discussion Questions 94
Exercises 95
Knowledge Busters: The Codification 98
6 The Environment of International Research 104
International Accounting Environment 104
IFRS Structure 107
IASB/ISSB/IFRIC Authorities 109
IASB and ISSB Due Process 110
Interpretations Committee Due Process 111
IASB’s Conceptual Framework 112
Principles-Based Accounting Standards 113
IFRS Funding Regulation and Enforcement 113
International Financial Reporting Standards (IFRS) Research 115
IFRS Hierarchy 115
IFRS Access 115
The Use of AI 117
Summary 118
Discussion Questions 118
Exercises 119
Accessing IFRS - IFRS Accounting/ISSB Sustainability Standards Navigator 120
Knowledge Busters 121
7 Other Research Databases and Tools 123
Database Research Strategies 123
Step One: Define the Information Needed 123
Step Two: Determine the Sources to Search 124
Step Three: Use Search Techniques and Tools 125
Step Four: View the Results and Manage the Information 126
Step Five: Communicate the Search Results 126
Commercial Accounting Databases and Tools 127
U.S. Accounting Research Tools 127
U.S. Government Accounting Databases 128
Financial Research Databases 129
Leading Publishers of Global Financial Information 130
S&P Capital IQ 131
Mergent Online 132
Other Financial Databases and Sources 133
Business Research Databases and Challenges 134
Article Index Sources 135
Other Specialized Research Sources 135
Legal Research Databases and Tools 136
LexisNexis Database Products 137
Westlaw Database Products 138
Recent Legal Database Competitors 139
AI’s Increased Presence in Databases 139
Summary 140
Discussion Questions 140
Exercises 141
AI Questions and Exercises 142
Knowledge Busters 143
Appendix 7A-1: Website Addresses 143
8 Tax Research for Compliance and Tax Planning 146
Tax Planning Goals Challenges and Databases 146
Tax Research Goals 147
Tax Research Challenges 148
Tax Research Databases 149
Primary Tax Authorities 150
Statutory Law: The Code 151
Administrative Law: The Treasury Regulations 153
Revenue Rulings and Revenue Procedures 155
Lesser Administrative Sources (Non-precedential) 155
Judicial Law: Court Cases 156
U.S. Tax Court 156
Other Judicial Sources of Authority 157
Steps in Conducting Tax Research 159
Step One: Investigate the Facts and Identify the Issues 159
Step Two: Collect the Appropriate Authorities 160
Step Three: Analyze the Research 163
Step Four: Develop the Reasoning and Conclusion 165
Step Five: Communicate the Results 166
Professional Concerns and Evolving Changes 168
Professional Standards for Tax Services 169
AI in Tax Research 170
Data Analytics in Tax Research 171
Summary 172
Discussion Questions 172
Exercises 173
AI Questions and Exercises 176
Knowledge Busters 176
Appendix 8A-1: Website Addresses 178
9 Assurance Services and Auditing Research 179
Assurance Services 179
Consulting Services and Standards 180
Attestation Services and Standards 182
Auditing Standard-Setting Environment 184
Auditing Standard-Setting Process 184
Public Company Accounting Oversight Board (PCAOB) 185
Auditing Standards Board (ASB) 186
International Auditing and Assurance Standards Board (IAASB) 190
AICPA Online Professional Library 190
AICPA Code of Professional Conduct 192
Thomson Reuters Checkpoint 194
Auditing Standards in the Public Sector 194
Preparation Compilation and Review Services 198
Role of Judgment and Professional Skepticism in Accounting and Auditing 199
Economic Consequences 200
Data Analytics/AI in Audit Practice & Research 200
Summary 202
Discussion Questions 202
Exercises 203
Knowledge Busters 204
10 Refining the Research Process 206
Method for Conducting Research 206
Step One: Identify the Preliminary Issues or Problems 207
Step Two: Collect the Evidence 211
Step Three: Analyze the Results and Identify Alternatives 216
Step Four: Develop a Conclusion 217
Step Five: Communicate the Results 218
Advice for the Future 220
Remain Current in Accounting Knowledge and Skills 220
Check AI But Don’t Rely on It 221
Understand Complexities in Practice 221
Develop Professional Skills Needed for Practice 222
Summary 223
Discussion Questions 223
Exercises 223
AI Questions and Exercises 224
Knowledge Busters 224
Appendix 10A-1: Certifications and Associations for Accounting Auditing and Tax 226
Appendix 10A-2: Research Sources from AICPA FASB PCAOB and Others 227
Appendix 10A-3: Abbreviations for International Canadian and U.K. Standards 229
11 Forensic Accounting Research 231
Forensic Accounting Standards 232
Definition of Fraud 233
Types of Fraud 233
The Fraud Triangle 234
Overview of a Financial Statement Fraud Examination 237
Step One: Identify the Issue and Plan the Investigation 238
Step Two: Gather the Evidence and Complete the Investigation Phase 238
Step Three: Evaluate the Evidence 239
Step Four: Report Findings to Management or Legal Counsel 240
Business Investigations 240
Computer Technology in Fraud Investigations 241
Data-Mining Software 241
Data Analytics 242
CaseWare IDEA 242
MindBridge Ai 243
ACL 244
Public Databases 244
Courthouse Records 244
Company Records 245
Online Databases 246
The Internet 246
Instant Checkmate (www.instantcheckmate.com) 247
Zoominfo.com (www.zoominfo.com) 247
Other Websites 247
AI in Forensic Accounting 247
Fraud Investigation Regulations 249
Summary 250
Discussion Questions 250
Exercises 250
Knowledge Busters 251
Index I- 1
