Abstract:The three models advanced by G. T. Allison inEssence of Decisionare applied to FASB's Statement of Financial Accounting Standards No. 19 to explain the adoption of the “successful‐efforts” method. In the first model, the decision is explained as the action that reflects a consistent, value maximizing choice within specific constraints. In the second, it is interpreted as the “output” of the FASB regulated by standard procedures, namely in recognizing an asset. In the third, it is viewed as a political resultant in a struggle involving interest groups. The analysis revealed the usefulness and some weaknesses of the Allison Approach to an understanding of the standard setting decision by the FASB. The approach is applicable world‐wide to other standard settin