Focusing on Paradox in Financial Accounting

The accounting profession has not made much headway in admitting that the traditional double entry system is not capable of simultaneously rendering a sensible balance sheet and income statement under changing prices. Consequently, little effort has been focused on addressing basic epistemological questions of 'Why do these flaws and paradoxes exist?' or 'What is the inherent underlying cause or nature of these paradoxes?' This paper reminds us of unresolved problems and paradoxes in accounting and suggests that concepts from philosophy, physics and game theory might serve as launching points for the accounting profession to gain more insight into the nature of the paradoxes and contradictions that seem inherent in many phases of financial accounting practice.