Organizational evolution at Lybrand, Ross Bros. and Montgomery in the twentieth century

Abstract

This article examines the evolution of practice strategy and organizational structure at the US accounting firm Lybrand, Ross Bros. & Montgomery from its inception in 1898 through to its merger with Price Waterhouse in 1998. We focus on the interaction between the firm and its broader economic, social and political contexts as we analyze key drivers of organizational change. The accounting enterprise developed a dual strategy involving both horizontal integration and service diversification for adapting successfully to changes in markets, professional knowledge, technology and regulation. Organizational learning was fundamental to its successful evolution in scale and scope as it enabled the firm to develop strategies and structures that responded effectively to changing external challenges and opportunities.

The profession of arms and the profession of accounting numbers – Accounting, the military and war: A review

“…Accounting, on the other hand, has a different profile within the wider community. As a discipline deeply entrenched within the business community and public administration, its generally low profile is only disturbed when major corporate scandals erupt into the public domain (Brewster, 2003; Chandar et al, 2014). Accounting is invariably accused, by association, such that its profile goes from low-key to active, but once the scandals have receded from the public gaze, the heightened profile also recedes.…”

Neither takers nor makers: The Big-4 auditing firms as regulatory intermediaries

“…Crises, such as the Great Depression (1929), the Black Monday stock market crash (1987), the dot.com bubble burst (2000), and the financial crisis (2008), tilt the regulatory pendulum away from the auditors and result in government intervention in accountancy rule-making. The Securities Act (1933), Sarbanes-Oxley Act (2002) and Dodd–Frank Wall Street Reform (2010) are respective cases in point (Chandar et al, 2014; Shore and Wright, 2018).…”

“…Since 2002, the market has been dominated by an oligopoly of four firms, known as the Big-4 (Allen et al, 2013). Consolidation of the audit market was driven by numerous factors, including the spread of information technologies which reduce the labor-intensive costs; audit firms’ need to expand in order to service the increasing internationalization of their clients and capital flows; clients’ demands for a one-stop audit, tax, and business consultancy shop for global operations (thus achieving economies of scale by following clients’ expansion); increasing provision of government consultancy services; growing competition among big auditors; and the need to withstand losses resulting from audit malpractice litigations (Chandar et al, 2014; Malsch et al, 2018; Shore and Wright, 2018). They dominate global audit markets, and their market shares tend to exceed over 90 per cent of most OECD countries, as well as other important economies (Big-4, 2013, Botzem, 2012; Hanlon, 1999).…”

“…The focus on experience and expertise privileges knowledge accumulated within the boundaries of the practicing accountancy profession. This knowledge, largely generated in the major auditing firms (Chandar et al, 2014), is transformed into standards-setting in several ways. The regulatory process is influenced, for example, through the abovementioned global IFRS centers.…”

Accounting as a social practice: US railroad regulation, value of service accounting, and regional economic development

“…Some scholars focused on the role of accounting information in building and coordinating the activities for both large-scale business and government entities (Chandar and Miranti, 2012; Churella, 2013; Gourvish, 1972; Johnson, 1973; Johnson and Kaplan, 1987; Levenstein, 1998; McDonough et al, 2020; Quattrone and Hopper, 2001; Skowronek, 1982; Yates, 1989). Others have concentrated on the rise of accounting professionalization including the growth of practice units and representative associations (Abbott, 1988; Allen and McDermott, 1993; Baskerville et al, 2014; Carnegie et al, 2003; Chandar et al, 2014; Chua and Poullaos, 1993; Edwards and Walker, 2007, 2010; Lee, 2006; Loeb and Miranti, 2004; Miranti, 1990; Poullaos, 1993; Previts and Merino, 1998; Shackleton, 1995; Verhoef, 2013).…”