Reviewed by R. H. Parker University of Exeter
“The time is out of joint” but, unlike Hamlet, one critical accounting historian believes she was born to set it right — and through the medium of company annual reports. There are two themes running through this entertaining, thought-provoking, well-written book. One is that General Motors, and hence the America of which it is a symbol, is in crisis; the second is that the pictures and words in annual reports (not just the financial statements) provide useful information. Neither of these themes is new. The author herself has written previously on gender and class in GM’s annual reports in Accounting, Organizations and Society, vol. 12, no. 1, 1987. What the author does is to link them together, showing that one could write a history of General Motors from its annual reports. Not that she really attempts to do this. Her history is based mainly on secondary sources (fully acknowledged) with quotations (but, alas, no pictures) from annual reports used as supplementary evidence.
From the point of view of a non-American, non-critical ac-counting historian who used to drive French cars and now drives Japanese cars, the book has a number of weciknesses. First, it is very much aimed at an American audience and what is good for America is not necessarily good for the rest of the world. But maybe what is good for the rest of the world is good for America. More reference to other countries would have been useful, especially to continental Europe and Japan where both corporate governance and the accountancy profession differ significantly from the American model.
Secondly, the author is much better in seeing the limitations of theories she disapproves of (the transaction cost approach to organizational change expounded in Chapter 2) than she is of theories she approves of (the dialectical approach to organizational change expounded in Chapter 3). Do they not both give partial but useful insights?
Thirdly, there is a surprising lack of empirical evidence. We are told that there are two commonly-held views of annual re-ports: that they are neutral reflections of reality; that they are outright fabrications. How does she know that these views are commonly held? It seems just as likely that GM shareholders and employees and other users believed that management was telling the truth but a partial truth that reflected its own inter-ests. This is an area in which research would be worthwhile. The author’s own view is that annual reports form part of “the symbolic universe of language, signs, meanings, norms, beliefs, perception, and values, through which individuals and institutions define themselves and are defined by others” [p. 100]. Put more simply, we give ourselves away every time we open our mouths or put pen to paper (as evidenced by both the author’s book and this review).
The above arguments assume that annual reports are actually both read and understood. Here there is a literature but it is not referred to by the author. Curiously, she tells us nothing about how the annual reports were compiled, to whom they were distributed, and by whom they were read.
Dr. Neimark blames America’s ills on corporate America, on its governments, and on free-wheeling global capital. Her an-swer is a call for greater corporate accountability and one does not have to share her political views to agree with her that this is desirable. Disappointingly, however, her recommendations for reform are packed into the last few pages of the book, with no adequate discussion and no reference to an existing literature. She merely asserts that auditors should be assigned to clients by an independent body (what independent body?) and rotated periodically; auditing should be severed from consulting (how would this work in practice? is there any evidence from other countries?); the non-financial statement portion of the” annual report should be taken out of the hands of management (but who then would be reporting to whom?).
In the last few paragraphs of the book, Dr. Neimark starts to develop interestingly radical ideas about a “truly ‘public’ ac-counting profession” [p. 168] financed by taxes levied on corporate income. No doubt she will tell us more about these ideas elsewhere. Dr. Neimark will probably enjoy trying to change the world and this reviewer will enjoy reading what she writes, especially if her next book, unlike this one, has an index.
