A glimpse of positive accounting theory (PAT)

Positive accounting theory (PAT) has been more developed than normative accounting theory in this era. The development of PAT research has discussed about what factors influenced management to report earnings. By using literature reviews, there are many researches in discussing the external factors to influence management to report earnings, such as bonuses, the debt equity ratio, political costs, and good governance. The other researches have discussed the association between earnings and stock prices. There are still few discussions about the selfmotivation of the directors or managers why choose a certain accounting method. The difference of environment, types of industry, and timing of financial statement reporting can be a further research. By using theories introduced by Popper, Kuhn, and Lakatos, PAT has elements in these three theories; however, PAT has not been categorized as science