Regulation Standardising Accounting Practice

8632 Words Jun 21st, 2015 35 Pages
University of Wollongong

Research Online
Faculty of Business - Accounting & Finance
Working Papers

Faculty of Business

2006

Regulation: Standardising Accounting Practice
M. Gaffikin
University of Wollongong, gaffikin@uow.edu.au

Publication Details
This working paper was originally published as Gaffikin, M, Regulation: Standardising Accounting Practice, Accounting & Finance
Working Paper 06/22, School of Accounting & Finance, University of Wollongong, 2006.

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06/22
University of Wollongong
School of Accounting & Finance

Regulation: Standardising Accounting Practice
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Thus, it was seen as necessary to maintain the integrity of the profession of accounting as the capacity to effectively self regulate was viewed as one of the hallmarks of a profession. The accounting profession, therefore, remained very private enterprise in keeping with the ideology of capitalism.
But, the state did intervene in creating the SEC as one of its functions was the oversight of the published accounting information of publicly listed corporations. However, after much debate between the SEC and the profession it was decide that the SEC would leave the profession to develop principles of accounting practice which would eventually become generally acceptable as a standard of professional performance. As indicated in the previous chapter, there have been varying interpretations placed on the reason for the state’s intervention in creating the SEC and why the SEC delegated its accounting responsibility to the profession. Taken together, both the creation of the SEC and the profession’s serious attempts at effective self-regulation would tend to suggest that they were necessary to preserve capitalism from the public disenchantment that marked the great depression.
These developments in the 1930s greatly affected processes of accounting regulation in the United States. Questions surrounding the issues involved continued for many