Theoretician:

Chambers is especially known for a proposed alternative to the conventional historic cost accounting system, CoCoA. A market-based system, it supplants historic costs as the primary valuation basis for reporting an entity’s assets and liabilities. Determining income for a period under CoCoA has three components: net revenues—all receipts less all payments made in the ordinary course of business; a price variation adjustment—the net amount of all changes in the cash equivalents of physical assets (namely, plant and equipment, buildings and stock in trade); and the capital maintenance adjustment—the scale adjustment necessary to restate net wealth at the period’s commencement in terms of the general purchasing power of the currency at its end.

A letter to the editor of The Australian newspaper in 1966 shows he had long felt that, as a practising art, accounting was a deeply flawed instrumentation system, being unserviceable for the decision making and control uses ordinarily made of it. He suggested ‘accounting should move into the space age . . . with much finer instrument systems.’ His posthumously published article, ‘Life on the Fringe—an Accounting Odyssey,’ succinctly indicates that those concerns endure o the present: ‘That its practice was fundamentally faulty was illustrated abundantly in the post-war inflation in the 1950s, ’60s and later, by the spate of takeover bids covering the same period, and by the disparity between what companies—or what company accounts—said their properties [assets] were worth and what they were really worth. Company accounts were false though they were said by company officers and auditors to be true. And what was false could be of no use to managers, investors or creditors. The flaws were universal—and if they could be excused or papered over in practice, that was no safe or serviceable ground for an extensively influential profession. I determined to try to set things right—by reworking basic ideas, challenging conventional practices or habits, and teaching a set of ideas to the rising generation of practitioners.’

Developed as part of repeated attempts to reform the law of company accounts, CoCoA is based on theoretical footings that are grounded in Chambers’ observations of commerce and the role of accounting in it. This grounded theory aspect is little known, or certainly rarely acknowledged. To undertake those reforms Chambers pursued many matters—in particular, the desire for, and pursuit of, general public awareness that there could be a better corporate reporting system. The SSA monograph observed that he wanted to establish: ‘a system based not on custom and dogma, but one that was rigorously, scientifically based. This meant the need for greater recourse to research, to theoretical explorations, to the history of its underpinning ideas, and to the empirical findings and testing of reform proposals.’ And, consistent with his view, that accounting was ‘a language of verbal and mathematical signs dedicated ideally to the service of trust between men,’ he initially searched for a definitive function of accounting as an instrumentation before settling on his preferred measurement attribute for reporting assets and liabilities. Convinced that accounting was like any communication system, he drew also on contemporary ideas in that wider field.

A leading, if not the leading 1960s U.S. accounting academic, Maurice Moonitz suggested that Chambers’ understanding and ability to summarize the relatively new communications literature and related fields, as evidenced in Accounting, Evaluation and Economic Behavior, ‘probes more deeply the “foundations” of accounting than any other similar work . . . explores the contributions of related fields in a manner that if not unique, is certainly not equalled by any other work with which I am familiar . . . I found his Chapter 7, “Information and Information Processing,” Chapter 8, “Communication” and Chapter 12, “Financial Communication Within Organizations,” to be lucid summaries of the work done recently in those fields, summaries . . . superior in many respects to those prepared by scholars in the fields themselves.’

But as the Sydney School history further noted: ‘At a time when others were concentrating on accounting from an “earnings viewpoint”—especially having recourse to the matching principle—he adopted a “balance sheet” viewpoint in the calculation of income, and the need to articulate definitions of asset, liability, revenue, and expense, distributions, and contributions—and of course the property of assets and liabilities to be measured. In this regard, he anticipated what is now widely known as the “conceptual framework” of accounting and the real (in an economics sense) exit price form of fair value accounting.’

Little discussed previously is Chambers’ role in lifting the status of accounting to that of an equal amongst other university disciplines, such as mathematics, philosophy, law, economics, engineering, medicine, and physics. Whittington and Zeff noted in an article in early 2000 that, with Australian colleagues (like Russell Mathews, Lou Goldberg and Reg Gynther) he advocated this for half a century. Success began in 1960 with his appointment as the foundation professor of accounting at the University of Sydney; thereby having accounting recognized at his home university as an academic discipline.

For many more years he continued arguing the case for that recognition to be justified. Part of this entailed the profession accepting graduate entry to it, but noting the need for a ‘Professional Year’ that contrasted with what the graduate student had been exposed to. In 1979 together with his University of Sydney colleague, Murray Wells, a joint submission was sent to Mr Bill Burgess, Chairman of the ICAA’s Education Review Committee, detailing their concerns about the proliferation of institutions delivering accounting education programmes over the last decade. They concluded, inter alia, that ‘the Professional Year should ‘extend the [graduate] student’s understanding of professional accountancy. . . [and provide] the means of applying his knowledge to the needs of practice.’ In their recommendations they suggest: ‘the Professional Year should be more concentrated and less diffuse in its contents. . . [examining] matters not generally dealt with in academic institutions, and with such matters as professionalism, ethics, conflicts of interest, independence, legal liabilities, obligations to the profession and the community at large, the organisation of work assignments and their supervision. . ., and so on.’