These are the slides for my seminar on accounting and development at the Institute for Development Studies, University of Sussex

1. Trevor Hopper

2.  Financial accounting – external reporting mainly to capital markets
 Management accounting – internal planning & control systems
 Auditing – statutory, internal & managerial
 Taxation – a by-product
COMMENTS
 Accounting profession dominated by ‘Big 4’ firms. Audit relatively small compared to consultancy
 Traditionally confined to financial data but increasingly extending to non-financial issues
 No generally accepted theory but standard setters & researchers inclined to neo-classical
economics
 In research extension into critical, social & political economy past 50 years – pushing boundaries
of accounting
 Worrying model of global regulation?

3.  STATE SOCIALISM
 Accountability from government enterprises & departments to PACs & ultimately
Minister in Parliament
 Scrutiny by audit institutions
 Information for central but iterative planning & control
 MARKET-BASED POLICIES
 International accounting standards to regulate private firms, lubricate capital markets
& attract FDI
 New public management (private sector systems) applied to government organisations
 Developing indigenous financial capacity & financial services
 Privatisation valuations

4.  GOOD GOVERNANCE
 Adoption of public sector accounting & auditing standards
 Dentralised participative budgeting
 Transparency & accountability
 Rise of non-financial development aims
 OTHER ISSUES
 Regulation & management of NGOs
 Taxation & regulation of MNCs
 Corruption
 Evaluating effectiveness of aid

5.  The diffusion of International Accounting Standards (IFRISs & IPSASs)
 Developing indigenous accounting professions & financial capacity in face of
global Northern professional associations & firms
 Accounting issues in privatised, state-owned organisations & MNCs
 Government accounting reforms
 Social and environmental accounting
 NGO accounting and accountability

6.  IASB sets international accounting standards (IFRSs) for private firms
 IFAC sets international auditing standards & public sector accounting standards
(IPSASs)
ISSUES
 Legitimacy of global regulators, especially IASB
 Neglect of developing countries needs & representation (especially IASB) &
inappropriate standards
 International financial institutions tend to measure success by formal adoption
but neglect effective implementation
 May promote global neo-liberal capitalism

7.  Increased globalisation of Northern professional accounting associations
 Weak indigenous accounting associations & capacity
 Rise of global alliances
ISSUES
 Northern profession (& IASB & perhaps IFAC) dominated by ‘Big 4’ accounting firms
 IFIs reliance on above for accounting policy & implementation
 Inappropriate syllabi – neglect of development issues & context & public sector
 Can bring local divisions & weaken development of local professions
 Indigenous overseas qualified accountants inclined to Northern systems

8. SOEs
 Decoupling often found. Sound a/c systems maintained but ceremonial & for legitimacy
PRIVATISATIONS
 Bring more effective accounting controls but not necessarily conducive to broader
development goals
 Problems of valuation & corruption
 New opportunities for neo-patrimonialism & weak regulation
MULTINATIONAL CORPORATIONS
 Taxation & transfer pricing problems
 Weak local capacity & legislation

9.  Often weak accounting & auditing
 Frequent disappointing results of reforms, especially in Africa
 Failure to measure effective implementation
 IFIs over reliance on Northern consultants & systems
 Over complex systems & standards
 One-size-fits-all packages not tailored to local needs
 Expensive
 Neglect of local input
 Unanticipated consequences
 Is accountability, transparency, media freedom & civil society involvement more
important than democracy?

10. Now major accounting research area but in policy
conventional financial criteria still predominate
Scepticism of corporate CSR – often greenwashing
Reconciling financial accounting & accountability with
 HDI criteria
 Good governance
 Human rights
Should & will this fall within domain of professional
accountants?

11.  Weak legislation, regulation & enforcement
 Problems of multiple reporting methods to funders
 Funder requirements (often short-run, financial & tangible) may drive out
broader development aims
 Large NGOs turning to conventional management controls to detriment of
beneficiary participation & broader development goals
 Neo-liberal accounting may encourage private sector micro-finance

12.  Development researchers & policy makers too often see accounting as technical &
defer to Northern accounting institutions & methods but it is political &
potentially broader than assumed
 A need for more considered approaches to developing indigenous accounting
capacity
 Over-emphasis on adoption & neglect of implementation – disappointing results &
unanticipated consequences
 Poor links between accounting researchers & development institutions
 Weak indigenous policy & research institutions
 Accounting a motor & language for neo-liberal globalisation – dominates research
in USA & developing countries
 Will the rise of new global players affect accounting standards & policies?