Performance Results in Value Added Reporting

Value added reporting provides a better measure of the wealth produced by a firm than other methods, says Riahi-Belkaoui in this research-based analysis. It is more useful generally to investors and other users of accounting information, and to policy makers throughout the financial services and related industries. Empirical studies of its uses in Europe support the author's contention and provide a compelling argument for its use in the United States. An important book for professionals and academics alike.

Value added reporting provides a better measure of the wealth produced by a firm than other methods, says Riahi-Belkaoui in this research-based analysis. It is more useful generally to investors and other users of accounting information, and to policy makers throughout the financial services and related industries. Empirical studies of its uses in Europe support the author's contention and provide a compelling argument for its use in the United States. An important book for professionals and academics alike.

Booknews

Value-added reporting measures the increase in wealth generated by the activity of a firm before that increase is distributed among labor, shareholders, and the government; it has become a standard accounting practice in foreign multinational corporations, but is being resisted in the US. Riahi-Belkaoui (accounting, U. of Illinois-Chicago) argues that is it a good idea. Among his points are that it can be executed with familiar models, has a better correspondence to stock returns than profit- based accounting, better explains market return and accounting variables, increases total assets during a takeover, and allows performance to be compared to the breadth of ownership. For accountants, business executives, and students and teachers of those professions. Annotation c. Book News, Inc., Portland, OR (booknews.com)

AHMED RIAHI-BELKAOUI Professor of Accounting, University of Illinois at Chicago.