Institutional reality, financial reporting and the rules of the game

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In this paper, I review the major arguments in John Searle’s 1995 book, The Construction of Social Reality, and use
them as the basis for exploring the relationship between economic reality and financial accounting numbers. In this
book, Searle provides the tools to analyze factual type representations in terms of objective and subjective with respect
to both their ontological status and their epistemological status. Using these tools, I demonstrate that many financial
accounting representations may be properly characterized as epistemologically objective facts, even though they have
an ontologically subjective mode of existence.

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