Verma, Shraddha (2000) The influence of culture and politics on accounting change in India from 1947 to 1998. PhD thesis, University of Warwick.

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Abstract

The exploratory research in this thesis analyses the influence of culture and
politics on accounting change since independence. A theoretical framework is
proposed within which historical studies of the influence of culture and politics
on accounting and accounting change may be undertaken. In this framework, the
accounting system is viewed as part of the whole social system in the country of
study, providing information for decision making and providing a tool for economic
and social development. Culture affects all the social systems in the country,
including the accounting system and the outcome of the process for accounting
change is affected by political processes.
Using the framework, accounting changes in India are broken down into three
phases, a source phase, a diffusion phase and a reaction phase. In the source
phase, change to the accounting system is set in motion, usually from outside the
accounting system. The diffusion phase of any change looks at how change is
dispersed and accommodated within the system and the reaction phase of any
accounting change looks at how the accounting system is modified subsequent to
the diffusion phase. The diffusion phase and the reaction phase encompass both
intra-system activity, activity between the different components of the
accounting system and trans-system activity, activity between the accounting
system and its neighbouring systems and both types of activity determine the
outcome of any change.
The framework is used to analyse key changes to the accounting system in India
from independence in 1947 through to 1998. The source of accounting change is
usually seen to coine from outside the accounting system in India and relates
mainly to the social and economic development of India. In both the diffusion and
reaction phases, intra-system activity takes place between the main regulatory
authorities within the accounting system which are identified to be government
institutions and proCessional accounting institutes. Trans-system activity too
takes place in both the diffusion and reaction phases and the main social systems
influencing the accounting system are identified to be the economic system, the
political system, the tax system, the financial system, the corporate system and
the international system. Culture, both nation-specific cultural values such as
hierarchy and collectivism and universal cultural values of high power distance,
low individualism, low uncertainty avoidance and high masculinity, affect all
social systems and all three phases of the change.
Culture is seen to influence the accounting system and accounting change in
India with strong Government involvement in accounting, the extensive use of
statutory legislation to promulgate accounting change, accounting regulated by
both statutory legislation and an accounting profession and accounting change
initiated for social and economic reasons. In addition, the accounting values seen
in the Indian accounting system are uniformity, secrecy with some transparency and conservatism with some optimism, which are as expected, based on the
cultural values of India. The process of accounting change is seen to be political
with government involvement in accounting, accounting regulations promulgated
through the parliamentary system and accounting change being the outcome of
interactions, both formal and informal, between the main parties interested in
accounting, identified to be government regulatory institutions, professional
accounting institutes, the corporate sector and parliament. The theoretical
framework is shown to be helpful in the analysis of both culture and politics on
accounting change in India.

Item Type:	Thesis (PhD)
Subjects:	H Social Sciences > HF Commerce > HF5601 Accounting
Library of Congress Subject Headings (LCSH):	Accounting -- India -- History -- 20th century
Official Date:	February 2000
Dates:	Date Event February 2000 Submitted
Institution:	University of Warwick
Theses Department:	Warwick Business School
Thesis Type:	PhD
Publication Status:	Unpublished
Supervisor(s)/Advisor:	Gray, S. J.
Sponsors:	Institute of Chartered Accountants in England and Wales (ICAEW)
Extent:	2 v. ([xxxvii], 524 leaves)
Language:	eng

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