| How to innovate contents of financial statements? We are as independent researchers have suggested some new ideas created & developed by us, which targeted changing established forms & indicators in financial statements, namely income statement & statements of cash flows & of retained earnings; actually they are one of key subjects on the accounting innovation. Dominating of the rote in accounting methodology still was bridling an innovation’s thinking & new ideas created & motivated from below. Today’s methodology & schedules of financial statements mainly introduced directive from above weren’t rendering proper opportunities in financial analyzing, forecasting, controlling & their forward looking innovations except ratio analyzing methods. Obviously the international standard of financial statements aren’t unshakeable perfection adopted from laboratory experiment, it’s only the declaration introduced by higher organs of power & which would be considered in chronicle order of social-economical evolution in future. The laggardness & wait-and-see accountancy policy bring to coming last in development of economics science, & staying behind after movement & development of their research objects. Obsolescence thinking in accountancy reflects on stagnant state of textbook’s innovation at higher education establishment for economics. Actually decision makers on accountancy don’t have perfect understanding of innovation in the field of financial analyzing & accounting modeling, maybe they think of that new ideas exist & relate only to materials production sector. You see that analysts at every turn face various uncertainty, symptoms of coming insolvency, pending solutions, efforts of multiple variable factors & statistical dimensions, which requires working out new methodologies on financial analysis & accounting modeling based on applied mathematics & theory of probabilities. Indeed accountancy has developed less than other field of economics science, which initially had been based on mathematics approaches, herein should recall that Luca Pacioli has established basic of modern accounting practice but however it exhausts all one’s internal potential to perfect oneself on future independently, as any science branch in its development process seeps through another or diversifies into separate parts. Meanwhile the science of statistics has developed & became one of key branches on mathematics, also diversified into several independent science fields as mathematical statistics, theory of probabilities, econometrics, business, social & life sciences statistics etc. The contents of financial statements & their indicators aren’t appropriating to proper needs of proceeding modern cost & managerial accounting & in order to realize corresponding analysis happen to collect mainly statistical or another various analytical information. By the way both statements as of cash flows & of retained earnings have fewer necessities to carry out financial analysis with contents & schedules needed today. Customers prefer to prepare tax statements on given time & properly rather than preparing financial statements due to last one isn’t practicable & less understandable etc. Used computer application programs for financial bookkeeping & preparing financial statements widely, but however cost & managerial accounting implements only by hand method due to programmers have poor knowledge both in economics & mathematical modeling. As we know ratio analysis based on financial statement’s indicators provides that one-sided results owing to some financial indicators increase, while others drop, in these case analysts face difficulties, connected with multiple changes of resulting indicators. In connection with above mentioned situations generates the necessary of applications on multiple regression score equations as Altman’s Zeta index, discriminate score analysis based multiple correlation relationship between variables denoted as y = f (ax1+bx2+cx3+…+ zxn) & theory of probabilities etc. Here should emphasize that preferring in usage of computer calculation programs SPSS & e-views without investigating thoroughly into essence of finance & accountancy would be led to copying thinking & spoon-fed education for learners. The accounting practice requires nonstandard thinking on innovations & developments of accountancy & it requires that necessary of educating learners in both of hand & computer calculation methods in parallel, herein we as researchers advocate an empirical teaching based on junction of integrated knowledge, first of all as on applied mathematics, mathematical statistics & econometrics approaches etc. Difficulties face while allocate manufacturing overhead expenses or operation expenses (marketing & general administrative) between many cost centers which classifies into fixed & variable expenses. Indeed not seems rationally innovation & development on creating & usage of indirect cost allocation methods in International accounting standard & other ruling materials. Instead of traditional technological stepwise process costing method, preferable application of ABC “Activity based cost” gives rather favorable opportunity for detailed distribution of management & marketing costs, but however ABC method has deficiency due to which leans on statistical mean & random sample, weighted percentage & classifications expenses into separate components by intuition. Taking into accounting these troubles we have thoughtfully studied the used in practice methods of indirect cost allocation & defining its variance influences (under applied & over applied overhead cost) which found remarkable application in economics university training of my mother country. I really believe in that the new ideas developed in some aspects of cost & management accounting with me & my family members will be able to find interesting in overseas countries with pleasure. Our researching area covers very wide range of topics on business statistics, financing, banking, accounting, analyzing fields in their combined form associated with economical engineering as well as separately for each one. In addition to that we have placed some of them at Google.com communication links under searching titles tyondon-researcher, & also tyondon_@yahoo.com, of course many extremely interesting & unique researching results were remained in author’s disposal expecting relative decisions of publishing. Obviously operation income describes by using both absorption & variable costing. Herein variable costing method applies for internal management for company. In compliance with general accounting rule income statement for company prepares on basic of absorption operation costing. Operating income of variable costing differs from absorption costing with fixed efficiency variance on manufacturing overhead by denoting yx = ao o(xo-x1). For both methods controllable variance of manufacturing overhead expenses apply to quarterly cost of product sold. But takes place of troubles connected with variance analysis of operation expenses which causes difficulties at university training & accounting practice, particularly in internal forecasting, budgeting, analyzing, modeling, engineering & controlling at entity’s level. The financial statements & their contents, indexes couldn’t play the role of effective tool in making analytical & rational decision based on retrospective & empirical accounting data basis in scope of company. Taking this situation into consideration we have put into practice in first ” Application of mathematical methods in calculation of variances on income statements prepared by using both variable & absorption costing” which published in textbook “ Financial statement analysis & modeling in forecasting” written by co-authors, Prof. T. Yondon along with his family members in 2009. By the way this new methodology based on new idea of analyzing effects of variances on factory overhead expenses, its full contents had been appeared in researching papers completed with us & published in 2004, than we have extended researching scope by allocation methods of both kind of indirect expenses as: manufacturing & operation (marketing & general administrative) expenses via using extraordinary unique & so interesting mathematical transformations in 3-5 alternative versions. Actually we have created & developed more than 40 new ideas only by means of our long time self-work from without assistance in accountancy firstly. First of all we have considered income statement prepared with three respective conditions using concepts of linear algebra & differential transformation: (1). Income statement prepared under absorption costing only differ with fixed efficiency variance on manufacturing overhead expenses. (2). Income statement prepared under absorption costing only differ with fixed efficiency variance on controllable manufacturing overhead expenses & operation expenses, direct material & direct labor. (3). Quarterly income statement prepared under absorption costing & variable costing in beginning & ending inventory etc. Our researching group has full confidence in feasibility & practicalities of created & developed with us new ideas & innovations in the field of financial analyzing & accounting modeling, which is integrating & diversifying by means of globalization accountancy & its outsourcing knowledge.
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