ABSTRACT
To describe a particular financial total as profit without further qualification is meaningless and may even be misleading. It is generally agreed that profit is representative of some kind of increase in value, but no consensus of opinion has yet emerged concerning how the increase in value might best be measured. The particular measurement procedures selected will represent no more than the product of the ideas of the particular group of individuals making the calculation. It is not, therefore, surprising that the accountant, the economist, the tax inspector and the businessman are each able to compute figures for profit, which differ to a significant degree, although based on the same economic transactions and perhaps even derived from the same financial records. The discrepancies merely reflect the fact that the various matters which must be taken into account when designing measurement principles appear in a different order of priority for each of the groups referred to. Certainly there is significant variation in the nature and purpose of the profit calculation as conceived by the accountant and the tax inspector, although it is not altogether clear whether the extent of the disagreement has become more evident or diminished over time.
