ABSTRACT
B. A. Rutherford's main concern about the cash flow accounting (CFA) proposals of Lawson and Lee was their claim that cash flow accounting is allocation-free. He articulated an argument, based on the notion of reported accounting data having empirical referents, that such data can never be allocation-free because of the economic interactions which take place within reporting entities. R. Ashton's one major criticism was the apparent inability of CFA to provide income measures for purposes of entity performance assessment. This theme appears in the critiques of both D. A. Egginton and G. J. Staubus, but does not appear in Rutherford. The first contribution on the relative merits of CFA ideas was made by Ashton. In particular, he provides a comparative review, identifying the differences, and the similarities. Given the nature of this criticism, and its infrequency, it perhaps should not be surprising that CFA ideas have been implemented in recent financial reporting practice.
