Without `Reinventing the Wheel': Business Accounting Applied to the Public Sector

This article considers why a business accounting model was applied in an early adoption of public-sector accrual accounting. The history of that change shows that large private-sector consulting firms were active in the promotion and implementation of a commercial model of public-sector accrual accounting. It is argued here that the consulting firms' actions are best understood using concepts of mimetic isomorphism and the interplay between self-interest and perceived public interest. They formed an epistemic community in which self-interest was present but with a zealous belief that private-sector accounting was an inherently righteous objective for the public sector.     

Without 'Reinventing the Wheel': Business Accounting Applied to the Public Sector

This article considers why a business accounting model was applied in an early adoption of public-sector accrual accounting. The history of that change shows that large private-sector consulting firms were active in the promotion and implementation of a commercial model of public-sector accrual accounting. It is argued here that the consulting firms' actions are best understood using concepts of mimetic isomorphism and the interplay between self-interest and perceived public interest. They formed an epistemic community in which self-interest was present but with a zealous belief that private-sector accounting was an inherently righteous objective for the public sector.     

Australia's ASRB. A Case Study of Political Activity and Regulatory ‘Capture’

The establishment of an Accounting Standards Review Board (ASRB) in Australia followed proposals for greater government and community involvement in the development of accounting rules, and concern about the low level of compliance with the accountancy profession's standards. The profession had opposed proposals for a review board. The Ministerial Council for Companies and Securities overrode these objections, yet avoided giving any formal authority to the ASRB. In this environment the way was left open for renewed opposition to arrangements which had reduced the profession's capacity to control the standard-setting process. The newly-formed ASRB was vulnerable if it was unproductive—and it encountered delays and difficulties in receiving and processing submissions from the profession. The Board lacked the authority (and the will) to enforce its priorities. After two years the Board abandoned earlier efforts to secure wider community participation in its activities, and announced ‘fast track’ procedures which were to be applied only to those standards which the profession chose to submit for review.

This history suggests that the ASRB had been ‘captured’ by interest groups that it had been established to regulate. The history also casts doubts on claims that the political processes adopted in Australia for the development of accounting rules are consistent with notions of ‘pluralism’; rather, those arrangements seem closer to the form of interest-group politics labelled ‘neo-corporatism’.     

Linking international business theory to accounting history: implications of the international evolution of the state and the firm for accounting history research

Accounting is an interdisciplinary subject. We routinely draw insights and models from the base disciplines (e.g. economics, psychology etc.) as a starting point for research on accounting issues. As accounting researchers, and accounting historians in particular, explore the international dimensions of accounting it is appropriate, therefore, to look to the literature on international relations for insights. This paper provides examples of how we could use the literature on the nation-state and international enterprises to frame questions about international accounting history.     

A Marxist accounting history of the British industrial revolution: a review of evidence and suggestions for research

An important debate neglected by accounting historians concerns the existence, origins and significance of the British Industrial Revolution (BIR). A key problem is explaining why Britain was such a technologically creative society. Part one uses accounting ideas to explain Marx's theory that industrial capitalism first appeared in Britain and was revolutionary because it took control of production to maximise the rate-of-return on capital employed. Part two shows that accumulating evidence of the use of modern management accounting by leading firms during the BIR supports Marx's view that it was a capitalist revolution in his sense. Part three argues that the accounting history of Boulton and Watt supports the hypothesis that the capitalist mentality and accounts drove revolutions in the technical and social relations of production during the BIR. Part four re-examines other well-known key sites for the study of accounting history and argues that these cases support the hypothesis that the primary cause of variations in accounting during the BIR was variations in the social relations of production. The paper makes suggestions for further research and concludes that, by thoroughly testing Marx's theory, accounting historians can make an important contribution to a major historical debate.     

The ‘Jim Factor’—My Experience as a First-Time Accounting Tutor

Sandy Burton was a seasoned academic who played a major role in shaping American accounting regulation in the latter part of the twentieth century. A vocal reformer, he became a vigorous SEC Chief Accountant and thereafter New York City Deputy Mayor. He was a critic of accounting practice as well as academe, preaching the gospel of reform in writings and speeches. Contending that accounting was too narrowly focused, he called upon the accounting community to reinvent itself. He was profoundly dissatisfied with the nature of academic accounting research because it had been irrelevant to practice. Burton earned considerable respect for attempting to bridge the gap between accounting practice and academe.     

Reconciling conflict: The role of accounting in the American Indian Trust Fund debacle

In 1887, the United States Congress broke American Indian Tribal lands into allotments which it held and controlled “on behalf” of individual American Indians in trust funds. The following century has been marked by allegations of fraud, mismanagement and accounting failures prompting repeated calls for reform, none very successful. As a result, neither the federal government nor trust holders themselves are sure whether the account balances are $7 or $100 billion currently.In 1994, Congress passed yet another attempt to reconcile the American Indian Trusts. This time, legislation spelled out the responsibility of the Secretary of the Interior (the department in charge of the trust accounts) to provide a complete “historical” accounting including accurate reports of balances, and to ensure that future payments of principal and interest were accurate and timely. More than 10 years later, the Interior reported its progress in a 24-page brochure that defended the Interior's narrowed definition of “historical” and its decision to limit its reconciliation to accounts that were open on 1994 or later. In the brochure, the Interior argued that its limited definition of historical and any other shortcoming in the Interior's efforts were acceptable given the cost of a more complete accounting. Finally, the brochure argued that the Interior Department had fulfilled its role as trustee and, as such, is the good guy in the conflict over these accounts. It is the Interior's American Indian Trust holders who are unreasonable troublemakers.In this paper, we examine the Interior's brochure and locate it within the larger conflicted relations between American Indians and the federal government. We are interested in the Interior's narrow vision of historical accounting, and the role this narrowness might play in deepening or resolving centuries long conflicts. We argue that the brochure provides an example of how parties in dispute over economic resources may attempt to frame or control the accounting process itself as a way to control those conflicts and limit the possible meanings that could be accorded to accountability within a particular set of relations. This episode illustrates how the ability to frame accounting definitions, formulations, and boundaries becomes a powerful means of controlling the final allocation of both dollars and political privilege. We conclude by accentuating the limitations of accounting in restoring a sense of justice and “balance” to relationships that embody uneven access to power and long-standing conflicts over economic claims.     

Govern(mentality) and Accounting: the Influence of Different Enlightenment Discourses in Two Spanish Cases (1761–1777)

New perspectives in accounting history have uncovered previously unattended relations between accounting and government. Earlier Foucauldian analyses of governments have not explained sufficiently the relations of accounting practices to governmental discourses in order to manage populations.
This work uses the governmentality frame to analyse the role of accounting in two organizations located in the south of Spain in the second half of the eighteenth century: the New Settlements of Sierra Morena and Andalucia (NSs) and the Royal Tobacco Factory of Seville (RTFS). The period studied is remarkable because it was the apogee of the Enlightenment in Spain. From the standpoint of government, this period facilitated a new way to manage populations. The present work has drawn on Foucault's concept of governmentality in order to discover how accounting worked in two government-supported organizations independently of the discourses that pervaded each one. Drawing on the reticulation of the space, the use of rules and accounting from the governmental perspective, we analyse those institutions.
The article concludes that the reticulation of space is an essential apparatus to exert action at a distance; the rules are a type of government technology; and, overall, accounting is a practice for the mastery of the population independently from the discourse of the institution.     

THE ORIGINS OF PRUDENCE IN ACCOUNTING

The paper attempts to explain the historical reasons for the dominance of the prudence concept in financial accounting by tracing the history of its meaning up to the end of the nineteenth century. Prudent accounting represented the elaboration by the accounting profession of a distinctive competence@8ithe determination of distributable profit@8iwhich enabled it to appear as the ally and advisor of large investors and management against “speculators”, thereby ensuring an equal return for equal capital. Prudence was crucial to the accounting profession in regulating the social relations of capital     

The birth of a nation: Accounting and Canada’s first nations, 1860–1900

The 1860–1900 period was both the “birth” of Canada but also the birth and institutionalization of a specific set of social relations between the federal government and First Nations peoples. This study examines the roles played by accounting and funding relations within the process of nation building. Throughout this formative period in Canada’s history, governance was attempted via the introduction of financial legislation and enacted by the Indian Department and agents in the field. As our analysis highlights, legislative initiatives, Indian Department pronouncements and the activities of agents imposed, enlisted and implied a variety of accounting technologies. This study not only explores how the federal government has used accounting/funding mechanisms in the attempt to translate government policy regarding indigenous peoples into practice but also provides a history of the present by examining the historical consequences of these interventions.     

Communities as a risk in mining: managing community legitimacy

Abstract

Using three cases from mining multinational enterprises (MNEs) in Armenia, this article conceptualises community risk, providing an alternative framework to conventional risk management approaches when managing local community relations. These approaches have been struggling to capture the increasingly complex risks originating from communities – both those who are directly affected by mining activities and the ones who have a vested interest in mining. The article defines two types of community relations which mining companies manage: communities of place (CofP), who live near the mine and are directly affected by its operations, and communities of interest (CofI), who are outside interest groups either opposing or supporting a given project. Community risks arise when CofPs create meaning about the legitimacy of the changes introduced into their physical and social environment, leading them to take action that affects the MNEs’ risk exposure to political, cultural or financial risks. The CofP can present these types of risks by acting alone or in cooperation with the CofI, who often have the resources and knowhow to affect corporate decision-making. The article contributes by defining community risk as an increasingly salient source of uncertainty for mining companies and MNEs in particular. Conceptualising community risk as the lack of legitimacy with these important stakeholder groups enables MNEs to strategise and adopt practices which are adapted to the local context. At the same time it assures investors, political and cultural stakeholders that the communities who have a specific interest in the project accept its impact.     

The use of microcomputers in intermediate accounting: Effects on student achievement and attitudes

The increasing use of the microcomputer by business and industry makes it imperative that accounting educators expose their students to the microcomputer. This exposure may manifest itself through an effect on student achievement as well as through student attitudes towards the microcomputer. This paper reports the results of an experiment in which two groups of students used the microcomputer to help them on either assigned earnings per share or assigned interperiod income tax allocation problems. An analysis of test results for student achievement in these two areas showed no significant differences between groups. An analysis of student reaction reflected student interest in using the microcomputer, despite the fact that it is not used often in accounting courses.     

Toward a different debate in environmental accounting: The cases of carbon and cost–benefit

Many champions of environmental accounting suggest that calculating and internalizing ‘externalities’ is the solution to environmental problems. Many critics of neoliberalism counter that the spread of market-like calculations into ‘non-market’ spheres, is, on the contrary, itself at the root of such problems. This article proposes setting aside this debate and instead closely examining the concrete conflicts, contradictions and resistances engendered by environmental accounting techniques and the perpetually incomplete efforts of accountants and their allies to overcome them. In particular, it explores how cost–benefit analysis and the carbon accounting techniques required by the Kyoto Protocol, the European Union Emissions Trading Scheme and other carbon trading mechanisms ‘frame’ new agents, spaces, relations and objects, and what the consequences have been and are likely to be.     

Recurrent rescues of a financial institution: Enduring human features and socialised losses

This paper is directed at showing that there are features of accounting resistant to technical progress in legislation, auditing and accounting standards so that it is not so much that history repeats itself as that there remain elements of the practice of accounting beyond legislative reach. Such elements stem essentially from diverse and perhaps ungovernable characteristics of human nature and relationships. This situation is exemplified through two case studies documenting an extraordinary recurrence of financial mal-management in the case of the Bank of New Zealand (BNZ). Twice, the BNZ fell into the hands of forceful individuals with political connections who were able to control its management and influence lending policy with disastrous results. In both instances separated by nearly a century, creative accounting masked poor performance, and the government was persuaded to rescue what was once affectionately known as ‘The People's Bank’. Such rescues represented a socialisation of losses, not least because the BNZ was shareholder-owned and those responsible escaped largely unscathed. Reliance upon the possibility of rescue may even promote riskier behaviour.     

The failure of accounting research to improve accounting practice: a problem of theory and lack of communication

There is anecdotal evidence to support the assertion that accounting research, or what is alleged to be research, is of little or no value to the practice of accounting, nor to the development of accounting as an academic discipline. The problem is not that efforts have not been made to conduct research, but rather there is a fundamental flaw in the accounting research process itself.Tricker suggests that the research process can be understood using two models. One is a set of relationships which “feed-forward”. That is, a known theory suggests a hypothesis, which is tested through the accumulation of data. If the hypothesis is proven to be true, it is added to the body of knowledge, enhancing the legitimacy of the underlying theory. The second model is intended to provide “feed-back”. That is, the real world is observed and a model of it is proposed, based on known theory. Data is collected and processed, and the model is refined. When the model is consistent with the real world and known theory, it is added to the body of knowledge. These research models depend on the existence of known theory for their usefulness.The central problem of accounting research is that there is no known theory to use as a reference for creating hypotheses or models to be empirically researched. The absence of theory can be seen in education, practice, and the research literature itself. Practitioners, for example, because of their training and lack of experience with and interest in research tend not to look to research findings to meet their professional needs. Accounting researchers, on the other hand, have created what appears to be a highly advanced research context which, in effect, is an environment dominated by sophisticated methodology, rather than theory. The research basically emulates the hard sciences, which makes its pursuit academically acceptable, but it lacks substance. This explains the failure of accounting research to improve accounting practice.     

Anatomy of a Professional Élite: The Executive Commitee of the American Accounting Association 1916-1996

The American Accounting Association (AAA) has an eighty-year history in which a relatively small number of executive committee (AAAEC) members have managed its organization through several significant changes in the accounting knowledge production process. Building on previous research of the AAA (Lee, 1995), this study examines the membership composition of the AAAEC and concludes that it has been dominated throughout its history by faculty from three major US universities. Using a theoretical perspective derived from Bourdieu (1988) and Whitley (1984a), the public interest implications of this élitist situation are discussed. In particular, the discussion interprets the study's findings at a time when there is considerable discontent with the management and leadership of the AAA.     

Accounting practices as social technologies of colonialistic outreach from London,Washington, et Cetera

Critical studies of accounting are a potential source of invigoration and action to abate lingering injustice and opportune the betterment of present and future life. In this study, we combine a foundation study of accounting usages over two centuries in the Kiribati Islands; and an exposé of these usages from the perspective of the I-Kiribati indigenes. The study is unusual in linking the history of a colony with the history of an emerging economy. We argue that colonisers espied economic, social and political benefits of colonialistic acts, and accounting usages were initiated and maturated alongside these, to avail commerce and life's personal dealings, religion-making, and government and public policymaking. Several persisting inadequacies of these accounting usages are revealed. They derive mostly from how asymmetric power relations in various contexts have played important roles in ways that accounting usages were constituted and sustained, and that this continues to be the case. The indigenes have not been accounted to, nor have had ready access to information concerning them. The indigenes have shared in some benefits but only incidentally and invariably down the pecking order. The indigenes have been precluded, befuddled and amazed by the usages, which concomitantly have enabled successive colonisers to re-define, enclose, exploit, subject and neo-liberalise them.     

论会计准则制定中的政府间博弈

会计准则具有经济后果,产生于不同会计准则的不同会计信息,会因此影响各利益集团的利益分配。因此会计准则的制定不是一种纯技术过程,而是各利益集团多次博弈达成的均衡结果。本文基于博弈论的视角,深入分析了会计准则制定中的政府间博弈,并就我国会计准则的国际趋同提出了一些建议。     

The effects of monetary incentives on effort and task performance: theories, evidence, and a framework for research

The purpose of this paper is to review theories and evidence regarding the effects of (performance-contingent) monetary incentives on individual effort and task performance. We provide a framework for understanding these effects in numerous contexts of interest to accounting researchers and focus particularly on how salient features of accounting settings may affect the incentives-effort and effort-performance relations. Our compilation and integration of theories and evidence across a wide variety of disciplines reveals significant implications for accounting research and practice. Based on the framework, theories, and prior evidence, we develop and discuss numerous directions for future research in accounting that could provide important insights into the efficacy of monetary reward systems.