A theory of the corporate decision to resist FASB standards: An organization theory perspective

Issues affecting the development of an international accounting standard on financial instruments

“…As expected from prior studies, most letters are from large corporations and organizations that are known internationally (Kelly, 1982;Watts and Zimmerman, 1986;Francis, 1987;Kenny and Larson, 1995;Larson, 1997;Georgiou, 2002;Hill et al, 2002;Elbannan and McKinley, 2006). The rationale normally given is that large entities are more likely than small ones to influence standardsetters, lobbying is too costly for small companies, and large organizations generally have more to gain from lobbying than do 6 While multiple letters from the same respondent were treated as one response, Boyd et al (1996) found that 49% of the letters sent to the FASB for its ED advocating substantial moves towards fair value accounting were from financial firms (primarily banks) and that non-financial firms accounted for 44% of the responses.…”

“…The accounting standard-setting process may be viewed as a technical process, a political process, or both (Gilfedder and 'O h'Ogartaigh, 2001;Zeff, 2002Zeff, , 2006Whittington, 2005;Elbannan and McKinley, 2006;Durocher et al, 2007). The technical view sees standard-setting as identifying the best accounting practice for each issue, whereas the political view perceives standard-setting as making policy decisions from alternatives that might better serve different interest groups.…”

“…A substantial amount of academic literature addresses the role of lobbying and constituent participation in the accounting standardsetting process, but most focuses on US, United Kingdom (UK), and Australian settings rather than with the IASC or IASB (Benston, 1980;Kelly, 1982;Sutton, 1984;Watts and Zimmerman, 1986;Mezias and Chung, 1989;Tandy and Wilburn, 1992;Walker and Robinson, 1993;Weetman et al, 1996;Georgiou, 2002Georgiou, , 2004Georgiou, , 2005Hill et al, 2002;Elbannan and McKinley, 2006;Larson, 2007). The perspectives examined in these studies include lobbying from a management's viewpoint, analysis of constituent participation, the influence of various parties on standard-setters, and the motivation for standardsetters to respond to lobbying efforts.…”

Setting UK standards on the concept of control: An analysis of lobbying behaviour

“…Thus corporate respondents who lobby would tend to do so to minimise their exposure to political and contracting costs associated with proposed standards (Watts and Zimmerman, 1986;Deakin, 1989;Larson, 1997;Ang et al, 2000;Elbannan and McKinley, 2006). In addition, the more relevant a proposed change of regulation is to a company's business, the greater the company's exposure to economic effects caused by that change and the greater the compliance costs.…”

The financing of the IASB: An analysis of donor diversity

“…Given the importance the market places on accounting information, one would expect corporations to favor harmonized global accounting standards to "level the playing field" vis a vis other corporations in the same industry. Therefore, we expect corporations to be actively engaged in the standard-setting process and legitimize the standard-setter by following the prescribed accounting standards, providing comment letters, and perhaps even making contributions to the standard-setter (Durocher et al, 2007;Elbannan & McKinley, 2006;Georgiou, 2005;Watts & Zimmerman, 1986).…”