ABSTRACT
The method of accounting proposed in this book differs only in some, but important, respects from the traditional mode of accounting. it makes use of initial prices for all inputs. All buying and selling, stock and bond issues, loan repayments and lending, are accounted for in the same way as in traditional accounting. The system differs only in respect of the subsequent valuation of non-monetary assets and the calculation of income. It takes into the accounts the effects of changes in particular asset prices and changes in the general purchasing power of money. The statements that the system yields would give a continuous and complete historical account of the financial affairs of a firm, since at each balancing date the amounts of assets and equities are expressed in up-to-date terms at that date.
