CH 02

Chapter 2
International Accounting
Patterns, Culture and
Development
Classification of Accounting
and Reporting Systems
Classification aids in
Describing, analyzing,
and predicting the
development of
accounting systems
Strategic planning and
control decisions
International systems
integration
The Challenge?
Adapt past effective

techniques to meet the
demands of the global
market
Must understand
international traditions
and heritage
International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr
Purposes of International
Classification
Describe
and compare international systems

Improved understanding of
Similarities and differences of systems

Development of systems and potential for change
Dominance of some systems over others
Assess
issues of international harmonization

Identify and solve problems
Purposes of International
Classification
Developing countries will

be informed of systems
in other countries
Aid international
accountants and auditors
Problems with
accounting and control
systems for MNEs
understood and solved
Classification Research
Deductive or
judgmental approach
Environmental factors
identified and linked to
national accounting
practices
International groupings
or development patterns
are proposed
Inductive or empirical
approach
Individual practices
analyzed
Development patterns or
groupings identified
Explanations based on
economic, social,
political, and cultural
factors proposed
Deductive approach
Muellers
four approaches to accounting

development
Macroeconomic pattern
Business accounting is tied to national economic

policies Examples: Sweden, France, Germany
Microeconomic pattern
Accounting is a branch of business economics

Example: replacement-value accounting in Holland
Deductive approach
Muellers
four approaches to accounting

development
Independent discipline pattern
Accounting is a service function derived from business

practice Examples: U.S. and U.K.
Uniform accounting pattern
Accounting is an efficient means of administration and

control Examples: France, Germany, Sweden,
Switzerland
Nobess Hierarchial
Classification
Inductive Approach
Nair
and Frank (1980) findings
1973 data
Four measurement groups
British Commonwealth
Latin America
Continental European
U.S.
Seven disclosure groups
Could not be plausibly described

No explanation offered for difference in groupings
Inductive Approach
Nair
and Frank (1980) findings
Differences between measurement and

disclosure groups
Hypotheses not supported
Cultural and economic variables associated with
disclosure practices
Trading variables associated with measurement
practices
Overall
culture
little attention given to influence of
Cultural Influences on Accounting

Systems
Culture, Societal Values, and the Accounting Subculture Fig. 2.3
Structural Elements of Culture

Hofstede
4 Underlying societal dimensions
Individualism
Power Distance
Uncertainty Avoidance
Masculinity
Countries
grouped into culture areas

Hofstede and Bond 5th dimension
Confucion Dynamism
Hofstedes Societal
Dimensions
Individualism versus Collectivism
Large versus Small Power Distance
Control the future or just let it happen
Masculinity versus Femininity
How a society handles inequalities among people
Strong versus Weak Uncertainty Avoidance
Peoples self-concept: I or we
The way a society allocates social roles to gender
Confucian Dynamism
Short-term or long-term orientation
Accounting Values Gray

Professionalism
versus statutory control

Uniformity versus flexibility
Conservatism versus optimism
Secrecy versus transparency
Professionalism versus
Statutory Control
Accountants are perceived to have independent

attitudes throughout the world
Public regulation or self regulation
U.K. rely on judgment of accountant

France and Germany implement detailed legal
requirements
Link to societal value dimensions Professionalism
Individualism
Weak uncertainty avoidance
Small power distance
Masculinity
Short-term orientation
Uniformity versus Flexibility
Uniform accounting plan and imposition of tax rules

for measurement purposes
Intertemporal consistency and some degree of

intercompany comparability b/c of flexibility
France and Spain

Facilitate national planning
Pursue macroeconomic goals
U.S. and U.K.
Link to societal value dimensions Uniformity
Strong uncertainty avoidance

Collectivism
Large power distance
Figure 2.4 Culture and Accounting

Systems in Practice
Authority and Enforcement
Conservatism versus
Optimism
Conservatism seen as a fundamental value
Strongly conservative
Japan, France, Germany, Switzerland
Less conservative
U.S., U.K., the Netherlands
Link to societal value dimensions Conservatism

Long-term orientation
Collectivism
Femininity
Secrecy versus Transparency
Stems from management and accountants

Closely related to conservatism
Secrecy
Secrecy relates to disclosure

Conservatism relates to measurement
High Japan, France, Germany, Switzerland
Low U.S. and U.K.
Link to societal value dimensions Secrecy

High power distance
Collectivism
Femininity
Accounting Values and

Societal Values

International Classification
Accounting values most relevant to professional or

statutory authority and enforcement
Accounting values most relevant to measurement

and disclosure
Professionalism and Uniformity

Both concerned with regulation and degree of enforcement
or conformity
Conservatism and secrecy
Country groupings
Optimistic and transparent

Conservative and secretive

International Classification
International Pressures for

Accounting Change
Growing
international interdependencies
Harmonization of the regulatory framework
internationally
Centrally planned economies embraces
market-oriented approach
Former U.S.S.R., Eastern Europe, China
New
opportunities for international

investment, joint ventures, and alliances
Economic Groupings and

International Organizations
European Union
UN
Promotes economic integration/harmonization

World Bank
International Monetary Fund
UN conference on Trade and Development
World Trade Organisation
OECD
Foster international economic and social development in

industrialized countries
Code of Conduct for MNEs
Impact of MNEs and

Globalization
Cultural
and social
Employment and consumption patterns
Significantly influenced
Pressure
for more accountability

Environmental impact
Impact of MNEs and

Globalization
OECD,
EU, IOSCO work for harmonization

and internationalization of securities markets
IASB and the International Federation of
Accountants (IFAC)
Professional organizations involved in

harmonization

CH 02

Hochgeladen von

Dokumentinformationen

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

CH 02

Hochgeladen von

Copyright:

Verfügbare Formate

Chapter 2

Adapt past effective

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

and compare international systems

Similarities and differences of systems

issues of international harmonization

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Developing countries will

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

four approaches to accounting

Business accounting is tied to national economic

Accounting is a branch of business economics

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

four approaches to accounting

Independent discipline pattern

Accounting is a service function derived from business

Uniform accounting pattern

Accounting is an efficient means of administration and

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

and Frank (1980) findings

Four measurement groups

Seven disclosure groups

Could not be plausibly described

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

and Frank (1980) findings

Differences between measurement and

little attention given to influence of

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Cultural Influences on Accounting

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Structural Elements of Culture

4 Underlying societal dimensions

grouped into culture areas

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Individualism versus Collectivism

Large versus Small Power Distance

Control the future or just let it happen

Masculinity versus Femininity

How a society handles inequalities among people

Strong versus Weak Uncertainty Avoidance

The way a society allocates social roles to gender

Short-term or long-term orientation

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Accounting Values Gray

versus statutory control

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Accountants are perceived to have independent

U.K. rely on judgment of accountant

Link to societal value dimensions Professionalism

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Uniformity versus Flexibility

Uniform accounting plan and imposition of tax rules

Intertemporal consistency and some degree of

France and Spain

U.S. and U.K.

Link to societal value dimensions Uniformity

Strong uncertainty avoidance

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Figure 2.4 Culture and Accounting

International Accounting & Multinational Enterprises - Chapter 2 - Radebaugh, Gr

Authority and Enforcement