The Politics of Accounting Regulation
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The Politics of Accounting Regulation

Organizing Transnational Standard Setting in Financial Reporting

Sebastian Botzem

The global financial crisis underlines the relevance of accounting standards as much more than instrumental rules for corporate reporting. This important book details the accounting standards that embody societal and professional values and contribute to the distribution of financial benefits that put international harmonization of standards into the limelight. Sebastian Botzem reveals that international standards have emerged after decades of contest and political bargaining, which resulted in closely aligned standards, voluntary consultation procedures and a network structure comprising actors mainly stemming from global auditing firms, regulators and international organizations.
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Chapter 2: Research on Transnational Accounting Standardization

Sebastian Botzem


The standardization of accounting, especially in the transnational sphere, has been an object of research across a variety of disciplines. In principle, the broad attention that it has received is a quite fortunate circumstance since a comprehensive approach is needed to understand the subject matter as well as the organizational and political dimensions of standard setting. Nevertheless, many of these streams of research coexist side by side and only rarely take account of related contributions in the neighboring disciplines. In this book, I will attempt to remedy this situation by drawing on different contributions from the fields of accounting, sociology, and political economy to explain transnational accounting standardization. The intention here is to offer a more comprehensive account of transnational institution building by drawing on a variety of approaches with the aim of improving our understanding through empirical and theoretical cross-fertilization. In recent years, standardization issues have enjoyed increasing attention in social scientific research. In the transnational realm, special interest is devoted to the ordering capacity of standards. Particular attention is given to the private character of many standard setting arrangements, which are often considered to be self-regulatory in nature. The seemingly voluntary character of standards changes when they become de facto binding rules that have an impact on a wide array of third parties, which may be private but also public actors. More generally speaking, transnational accounting standards can be considered as design standards in the realm of international business (Timmermanns and Epstein, 2010). As such, they are intended...

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