After years of hoping that the problem would go away if ignored, businessmen, accountants and regulators finally are coming to grips with the troubling question of how to record the effects of inflation on corporate profits (or losses).

In the past, interest in the subject would flow and ebb with the rise and flow of the inflation index.

Now, however, with inflation running at a sustained rate of about 7 percent and nudging upward, several approaches to inflation accounting are under discussion.

Later this month, the Financial Accounting Standards Board, which sets standards for the accounting profession, will take recommendations on how the inflation factor should be treated on the profit-and-loss statements.

If the past is any guide, the FASB probably will recommend a go-slow approach that would relegate the effects of inflation on corporate earnings to a footnote.

But the Securities and Exchange Commission already requires that companies it regulaties make certain disclosures on the effects of inflation in footnotes in their financial statements. Companies must report, in those easily overlooked notes, such important and complex facts as what it would cost at today's prices to replace existing plant, equipment and inventory.

Joseph Connor in October became senior partner of Price Waterhouse & Co.-No.3 of the Big Seven accounting firms. He believes the inflation factor should appear right in the company's profit-and-loss statement.

Under the Connor approach, a stockholder would see the same profit (or loss) figure he got today from his company. He also would get a figure reflecting the effect of inflation on the company's bottom line.

"Accountabts don't have responsibility for stemming inflation, but we do have the job of reporting it," say Connor, who speaks passionately about the subject.

"Our system has precious little time left in which to adopt an accounting method which clarifies the economic fact of inflation," he claims.

Some accounting firms have proposed adoption of replacement cost accounting, similar to that used in the SEC calculations, to record inflation. In effect, this system requires a revaluing of assets based on the cost of the items in today's market.

The critism of this approach is that it requires too much subjective judgement in placing a value on assets.

Price Waterhouse's Connor has a different approach, which he considers more objective.

Connor would not restate the value of all the assets. Instead, he would produce a one-line adjustment that comes from applying the Commerce Department's GNP price index to a company net income figure (before taxes).

Thus, under this approach, a compoby would report a conventional income figure. It also would show a second figure reflecting the impact of inflation on income. In Connor's view, this second figure is the "real" earnings of the company.

One significant effect of this approach, of course, would be to reduce the amount of taxable income. Currently, says Connor, "taxable income computations significantly overstate the "real" earnings of taxpaying entities with resultant income tax assessments at levels well beyond statuory rates."

Connor allows that stockholders may be shocked when they see the "real" worth of their companies, but he believes that accounting for inflation will have a healthy, long-run effect.

He says, it is hypocritical for companies to be piling up record quarters on paper profits, then going to Congressmen for tax relief on the basis of inflation figures.

"Because companies are overreporting," he says, "capital maintenance is not occuring, let alone capital formation."

While some business executives endorse the need for accounting for inflation in their company's financial statement, the sentiment is by no means universal. For some, the high point of theif year is when they can boast of record-albeit inflated-profits to their admiring shareholders.