Question $2$

a$)$ What is the difference between a positive theory of accounting and a

normative theory of accounting?

b$)$ In the $1960$s several accounting researchers concentrated on developing

theories of accounting based on observing and documenting the behaviour of

practicing accountants. Do you think that such research is useful in improving

the practice of financial accounting? Explain your answer.

c$)$ The International Accounting Standards Board has a number of roles,

including formulating accounting standards and developing a conceptual

framework. Is the work they do in developing an accounting standard or the

conceptual framework normative or positive in nature?