Auditor Lobbying for Accounting Standards: The Case of Banks and Savings and Loan Associations

Meier, Heidi Hylton; Alam, Pervaiz; Pearson, Michael

doi:10.1080/00014788.1993.9729892

Cited by 30 publications

(23 citation statements)

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“…An alternative approach, which regards accounting firms' wealth as a function of their clients' wealth, suggests that accounting firms would lobby for rules that promote their clients' economic interests (Watts and Zimmerman, 1981;McKee, 1991;Meier et al, 1993;Owsen, 1998;Georgiou, 2002).…”

Section: Prior Researchmentioning

confidence: 99%

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

Stenka

Taylor

2010

Accounting and Business Research

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The present study aims to contribute to an understanding of the complexity of lobbying activities within the accounting standard-setting process in the UK. The paper reports detailed content analysis of submission letters to four related exposure drafts. These preceded two accounting standards that set out the concept of control used to determine the scope of consolidation in the UK, except for reporting under international standards. Regulation on the concept of control provides rich patterns of lobbying behaviour due to its controversial nature and its significance to financial reporting. Our examination is conducted by dividing lobbyists into two categories, corporate and non-corporate, which are hypothesised (and demonstrated) to lobby differently. In order to test the significance of these differences we apply ANOVA techniques and univariate regression analysis. Corporate respondents are found to devote more attention to issues of specific applicability of the concept of control, whereas non-corporate respondents tend to devote more attention to issues of general applicability of this concept. A strong association between the issues raised by corporate respondents and their line of business is revealed. Both categories of lobbyists are found to advance conceptually-based arguments more often than economic consequences-based or combined arguments. However, when economic consequences-based arguments are used, they come exclusively from the corporate category of respondents.

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Section: Prior Researchmentioning

confidence: 99%

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

Stenka

Taylor

2010

Accounting and Business Research

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“…However, the auditors' position is unlikely to be identical to that of their clients as they also have their own private incentives (Watts and Zimmerman, 1986;Meier et al, 1993). These private incentives take several forms.…”

Section: Sample Selectionmentioning

confidence: 99%

“…Auditors are an important group in the accounting process who are involved in standard setting in almost all countries. For example, there is considerable evidence that they are involved in lobbying of the standard setting process in a wide range of countries including Australia (Johnson et al, 1995), China (Harris, 1996), the Netherlands (Van Lent, 1997) the U.K. (MacArthur, 1988;Pong and Whittington, 1994) and the USA (Meier et al, 1993). Auditors are also heavily involved in the administration of accounting standards.…”

Section: Sample Selectionmentioning

confidence: 99%

“…Agency theory suggests that auditors will act as agents of their clients and that it is in their interest to support the position taken by their clients. However, the auditors' position is unlikely to be identical to that of their clients as they also have their own private incentives (Watts and Zimmerman, 1986;Meier et al, 1993). These private incentives take several forms.…”

Section: Sample Selectionmentioning

confidence: 99%

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Attitudes towards Uniform Accounting: Cultural or Economic Phenomena?

Roberts

Salter

1999

Financ Manag Account

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The existing literature suggests that uniformity versus flexibility is a key dimension of differentiation in cross-national financial reporting practices. However, the issue of what drives attitudes towards uniformity has not been explored. Drawing upon a variety of existing studies, this study explores the attitudes of "Big 6" auditors in 23 countries towards rules mandating a single treatment across 14 issues. The study finds that auditors are in favor of a single mandated treatment in the majority of cases and that support for such rules is affected by both culture and the importance of the domestic stock market to the country. These results hold true even after the influence of extant practice or the level of uniformity of current practice is controlled for. Relatively higher levels of uniformity in de facto financial reporting practices and relatively stronger support for increased uniformity were both found in many of those countries which are traditionally thought of as having more flexible financial accounting systems.

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“…They will typically be involved in some form of advisory capacity on remuneration for industry and see themselves as having a role to play in the Inquiry. Importantly, when members of these groups decide to engage in lobbying activities, they potentially face a conflicting set of incentives involving a trade-off between the need to protect their clients' economic interests and the need to protect their own private interests associated with the provision of services related to corporate governance and remuneration (Meier, Alam & Pearson, 1993;Puro, 1984;Watts & Zimmerman, 1982).…”

Section: Professional and Representative Bodiesmentioning

confidence: 99%

Executive Remuneration: Achieving Accountability through Disclosure

Beaumont¹

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Auditor Lobbying for Accounting Standards: The Case of Banks and Savings and Loan Associations

Cited by 30 publications

References 1 publication

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

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

Attitudes towards Uniform Accounting: Cultural or Economic Phenomena?

Executive Remuneration: Achieving Accountability through Disclosure

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