The new accounting law in Hungary has been operational since the start of 1992. Previous publications have set out a range of factors which may have influenced the shaping or the application of the law. This paper reports the results of a joint Hungarian/UK pilot initiative to explore by interview methods the perceptions of Hungarian entrepreneurs and of non-nationals working in Hungary, as regards the various influences on the development of the law and the potential users of the financial statements produced. The investigation was undertaken during 1993 when there had been an opportunity for most enterprises to experience a full business year using the law. Although the law has been written to comply broadly with the Fourth Directive of the EC, there remain some aspects of the Fourth Directive which might be regarded from a UK perspective as not having been fully implemented, particularly in relation to provisions. The paper concludes that while the impact of the move to the market economy is a visible factor, both in the drafting of the law and in the perceptions of the likely users of the financial statements, the influence of state regulation remains, particularly in the context of the continuing perceived impact of fiscal policy on accounting regulation.

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This paper presents an exploration of change and choice in Hungarian accounting practice following implementation of the Accounting Law of 1991. A question-naire has been used, supported by interviews, to identify patterns of, and reasons for, change and choice. 'Analysis of the data leads to proposals for a focus to further research in this area. The paper first outlines the background to the 1991 Accounting Law and the changes it introduced. The data and questionnaire method are then explained. Information collected from the questionnaires allows subdivision of respondents into two groups such that one group (the observers) is used as a source of opinion on patterns of, and reasons for, change which may be tested by the practices applied by the other group (the financial managers). This method of analysis is applied to eight significant areas of accounting policy, from which conclusions are drawn regarding the factors which appear to have influenced change and choice in Hungarian accounting practice.