UNAIR NEWS – Before modern accounting developed, the people of Ancient Egypt, Mesopotamia, Babylonia, Assyria, and Sumeria 7,000 years ago also knew accounting. In the course of its history, accounting has continued to develop.

According to Prof. Dr. Basuki in his professorship inauguration on Saturday, July 29, stated that accounting now experiences expansion of meaning, especially when they were seen from a different perspective, such as accounting as art, as an ideology, as a language, as a historical record, as an information system, as a commodity, and as technology.

“As an art, accounting is interpreted as an art of recording economic activity. As a language, accounting communicates business information, ” he said in his scientific oration in Garuda Mukti Hall, 5th Floor, Rector of Universitas Airlangga.

Prof. Basuki also said accounting provides a historical record of the manager’s service to the wealth owner and shareholders. As an information system, accounting is a process that links information sources or transmitters (usually accountants), communication advice, and a group of receivers (external users).

Accounting is seen as a commodity because it is the result of economic activity. Finally, as technology, accountants are able to provide and produce information requested by the user.

Traditional understanding

Even so, Prof. Basuki said that there is a tendency for traditional accounting to remain inherent. What people know, accounting is aimed to record and report financial transactions based on certain rules.

“However, it turns out not all agree with such an understanding of accounting,” he said.

Prof. Basuki quoted Hopwood’s statement (2007: 1367) as quoted by (Gray, 2013: 259) There were them … and there are now people who think that they know what accounting … is. How wrong these people are . According to him it is not wrong.

Because, traditionally, accounting is intended to support corporate activities, identify and record, and report on external transactions. Shareholder prosperity ( shareholder’s wealth ) is often proxied with stock prices as the main keyword.

“On the other hand, accounting (finance, ed) loses its sensitivity to the environment,” he said.

Prof. Basuki stated, the word profit became an icon. Gaining profit (as much as possible) becomes a goal, sometimes at any cost.

“Then what about other things like social and environmental issues? What is the owner’s social responsibility? Is it discussed in accounting? ” he said.

Environmental Issues

A global warming issue has often been discussed, especially related to excessive corporate activities. Company’s involvement in environmental changes cannot be denied and it affects the climate.

“This accusation primarily leads to companies operating without regard to the impact of their operations on the environment. Both natural and social, “he added.

Prof. Basuki gave examples on Exxon Valdez’s tankship accident in the 2000s in Canadian waters and an accident at a mining company in New Zealand in 2010 with 29 mine workers died.

“Or a mining accident in Chile in 2011 where 33 miners were trapped for 69 days underground,” he said.

In the closest scope, in Indonesia, Lapindo Mud case has been a bitter story of the company’s negligence in its mining activities. For the excessive activity and insensitivity of the company, environmental aspects are neglected.

According to Prof. Basuki, times have changed, it is not the time for accounting to only dwell on the service of capital owners. The involvement of other elements is needed such as values which are more humane, not just mechanical.

Prof. Basuki said that it is very important. The separation of religious, humanity values from science due to differences of opinion of experts hundreds of years ago created humans into “economic beasts”. They will prey anyone who is appropriate or even inappropriate.

Based on these facts, Prof. Basuki believed it is time for accounting to educate the public and business people to be more sensitive to the impact of environmental damage, especially thinking about environmental sustainability and the general public.

“Accounting should also calculate the impact of post-production for the environment and society,” he said.

Indirect environmental burden by company products should also be a concern. The results of accounting calculations can be used by the government as a regulator to produce legal rules that must be able to “force” business people, as well as the public, to be more concerned about the physical and social environment.

In the end, the good value instilled to the students becomes the key for the future, especially as an effort to make accounting a mean to community welfare.

According to Prof. Basuki, there are four things to consider by accounting. First, accounting which only concerns with profit markets, and forgets social and environmental impacts must be abandoned. Secondly, education starting from PAUD, elementary, middle, and high must have introduced environmental awareness. Third, accounting education must instill value in students that wealth is not everything. And fourth, accounting must be a mean to make people more prosperous without damaging the environment. (*)

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Author: Feri Fenoria Rifa’i