The Legal Structure of the Firm

Robé, Jean-Philippe

doi:10.2202/2152-2820.1001

Cited by 106 publications

(117 citation statements)

References 52 publications

(4 reference statements)

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“…According to the predominant (Hanlon & Heitzman, 2010;Scholes et al, 2015) nexus of contracts approach, companies are legal fictions (Fama, 1980;Jensen & Meckling, 1976) and legal fictions cannot act in a social science sense. The nexus of contracts approach is criticized from a perspective of social ontology (Gindis, 2007(Gindis, , 2009List & Pettit, 2011), a legal perspective (Robé, 2011), and a social science perspective (Biondi, 2007;Vanberg, 1992). While Vanberg takes an individualistic approach and refers to individual action hypotheses, Biondi takes a dynamic holistic view but does not explicitly refer to action hypotheses.…”

Section: How Can We Determine If the Authoritative Principle Conformsmentioning

confidence: 99%

Is a One-book-system Adequate? A Framework for Tax Law Analysis Under Genuine Uncertainty

Schmiel

Weitz

2017

Accounting, Economics, and Law: A Convivium

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Abstract:This paper examines whether a one-book-system that takes the commercial law profit definition as tax base (the so-called authoritative principle) is adequate from an evolutionary point of view. We consider firstly the case that European International Financial Reporting Standards (EU-IFRS) are relevant for all statements with the authoritative principle based on EU-IFRS. Secondly, we examine the fact that EU-IFRS focus on the consolidated annual accounts and that the national accounting principles are relevant for individual statements. Tax law analysis under genuine uncertainty requires a framework and we present such a framework. It entails an interpretation of equality of taxation, a hypothesis on the functioning of markets, an interpretation of realizable and desirable market goals, tax effects hypotheses, and action hypotheses for personal and corporate companies under genuine uncertainty. Contrary to the mainstream of accounting literature, from our evolutionary point of view, the authoritative principle is adequate. The reason is that commercial profit is an adequate instrument to achieving the tax goal equality of taxation in the sense of reducing expectable tax avoidance decisions. This is the case because according to evolutionary action hypotheses as well as tax effects hypotheses, commercial profit can be a subjectively rational decision criterion for personal and corporate companies alike. Equality of taxation is for its part in line with the evolutionarily interpreted social values freedom of choice and equality before the law. Since we focus on the question if the existing commercial profit concept can be an adequate tax base, we do not discuss whether we would have more reasons to take a conservative profit concept as tax base rather than EU-IFRS. Just as little, we analyze whether it is better to take EU-IFRS profit as tax base although national accounting principles are relevant for individual statements.Keywords: ability to pay-principle, authoritative principle, equality of taxation, evolutionary tax effects hypotheses, evolutionary analysis of tax law, horizontal equity, vertical equity JEL classification: B53, K34, M48

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Section: How Can We Determine If the Authoritative Principle Conformsmentioning

confidence: 99%

Is a One-book-system Adequate? A Framework for Tax Law Analysis Under Genuine Uncertainty

Schmiel

Weitz

2017

Accounting, Economics, and Law: A Convivium

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“…428). Differences between the respective legal and economic imaginaries are summarized in From the perspective of the legal imaginary, the economic imaginary relies upon a displacement that amounts to intellectual shamanism (Bratton, 1989;Robé, 2011; see also quote below), as it lends unsupportable (academic) legitimacy to the assertion that "public companies should be run predominantly, if not exclusively, in their [the shareholders '] interests" (Ireland, 1999: 49), and because the distinctive advantages of the corporate form over the partnership form -such as limited liability and the reduction of opportunity costs -are trumpeted without regard to the legal imaginary of the <irm in which a collective, multi-stakeholder conception of its purpose is assumed.…”

Section: The Economic Imaginarymentioning

confidence: 99%

What is the corporation and why does it matter?

Veldman¹,

Willmott²

2013

M@n@gement

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“…From the legal-economic viewpoint, enterprise entities are not financial trusts, nor portfolios of disparate (groups of) assets and liabilities, but ongoing economic activities whose legal form relates to partnerships, corporations and combinations of them in enterprise groups Strasser and Blumberg 2010;Robé 2010).…”

Section: Accounting: Financial or Economic?mentioning

confidence: 99%

“…The following section will address this question by discussing the case of intangibles and the distinction among equity and liabilities. To be sure, this focus on asset and liability concepts neglects the fundamental issue of the economic entity behind its legal form, including the matter of enterprise groups (Strasser and Blumberg 2010;Robé 2010). In the latter context, the accounting question is not so much related to the accounting for single elements, as to the actual economic stakes of the business enterprise over and beyond its legal appearances.…”

Section: Is Fair Value Accounting?mentioning

confidence: 99%

The Pure Logic of Accounting: A Critique of the Fair Value Revolution

Biondi¹

2011

Accounting, Economics, and Law

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When international accounting standards were renamed to become international financial reporting standards, this seemed to imply that accounting no longer needed to exist, but rather had to be reconsidered as a part of financial communication and advertising. Does traditional accountability no longer matter? Betrayed investors and globalized stakeholders would dissent. A difference of nature continues to exist between fair values disclosed by managers and certified by auditors, and the actual performance generated by the enterprise entity through time, space, and interaction. In a world shaped by complex organizations facing unfolding changes, hazard and limited knowledge, the quest for fundamental principles of accounting is not academic. Accounting principles constitute a primary way that the creation and allocation of business incomes is governed; that is, fairly managed and regulated in the public interest, having respect to "other people interests." This article adopts a dualistic posture that opposes the accounting conceptual frameworks based on fair value (market basis) and historical cost and revenue (process basis). The fundamental premises about the underlying economics of the enterprise entity are discussed, including the representation of the business and the concepts of asset and liability. References are made to the case of accounting for intangibles, and to the distinction between equities and liabilities. The cost and revenue accounting perspective is then defended in terms of accountability, but also from the informational viewpoint: historical accounting information plays a special role as a lighthouse in the dynamic and strategic setting of the Share Exchange. In particular, two refinements of the historical cost (and revenue) accounting model are suggested. The first one regards the treatment of earned revenues from continuing operations, and the second, the recognition of shareholders' equity interest computed on the actual funds provided in the past, coupled with the distinction between shareholders' equity and entity equity.

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The Legal Structure of the Firm

Cited by 106 publications

References 52 publications

Is a One-book-system Adequate? A Framework for Tax Law Analysis Under Genuine Uncertainty

Is a One-book-system Adequate? A Framework for Tax Law Analysis Under Genuine Uncertainty

What is the corporation and why does it matter?

The Pure Logic of Accounting: A Critique of the Fair Value Revolution

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