1 Introduction
It is perhaps little known that accounting and mathematics have been connected for
more than 500 years ago. In 1494, Luca Pacioli published his mathematics compendium
Summa de Arithmetica, Geometria, Proportioni et Proportionalita consisting of
615 pages. “[T]he only significant part of the book that has ever been translated to
English” was the 27-page treatise on bookkeeping, which defines the hour of birth
of accounting. So to speak the study of double entry accounting was developed in
concert with linear algebra. Beyond the joint development, which becomes apparent
in Pacioli’s book, there are several reasons why accounting offers a very good
application for mathematical techniques and mathematical knowledge. First, accounting
phenomena cannot be understood best by just observing them. For generating
predictions and interpretations [analytical] theory is required. Second, formalizing
economic arguments by means of a mathematical model results in a more rigorous.
presentation. With accounting and auditing becoming international, it is more important
than ever to have a common ground for discussion that is not hampered by any
language barriers. This common ground is provided by mathematical and analytical
methods, like agency theory or game theory. Third, accounting and auditing are
highly regulated by national and international standards. If standard setting processes
comprise strategic behavior by and strategic interactions (in the sense of game theory)
between companies, investors and auditors then our analysis of these interactions may
benefit from game theoretical models. More generally, accounting theory cannot only
rely on normative standards.
The objective of this special issue of OR Spectrum is to emphasize the impacts
of accounting and auditing regimes on the behavior of rational agents acting in this
environment. The set of papers presented here covers auditing, financial accounting,
managerial accounting, and tax accounting highlighting the importance of strategic
behavior in all these sub-disciplines of accounting