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International Accounting Standard Setting: A Network Approach

Published online by Cambridge University Press:  20 January 2017

James Perry  and
Andreas Nöelke
James Perry
Affiliation:
Vrije Universiteit Amsterdam
Andreas Nöelke
Affiliation:
Vrije Universiteit Amsterdam
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Abstract

The article takes a political economy perspective on the current harmonization of accounting standards. It argues that the process not only signals a major shift in the mode of governance (towards private authority), but also in the substance of what is being governed. In political-economic terms, the most significant change which the International Accounting Standards Board (IASB) brings to accounting is an increased reliance on market values in the form of so-called Fair Value Accounting (FVA). The FVA paradigm represents a financial perspective on business operations. This perspective is matched by the process and structure of the institutions that govern international accounting standard setting, particularly the IASB and the European Financial Reporting Advisory Group which advises the Commission of the European Union on the adoption of IASB standards. A network analysis of the different committees and working groups of these two institutions demonstrates that financial sector actors wield substantially more influence than other categories of business actors within the governance of international accounting standard setting.

Keywords

accountingstandardsharmonizationnetwork analysis
Type
Research Article
Information
Business and Politics , Volume 7 , Issue 3: Special Issue: The Globalization of Accounting Standards , December 2005 , pp. 1 - 32
Copyright
Copyright © V.K. Aggarwal 2005 and published under exclusive license to Cambridge University Press 

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