Reviewed by Herbert L. Jensen University of Houston

The stated objectives of this monograph are “. . . to discover and trace the origins and evolution of the process by which accounting principles are established in New Zealand” (preface). Nonetheless what is presented is a narrative tracking of changes in the structure of standard setting elements within the organization of the New Zealand Society of Accountants (NZSA). The major theme of this discourse is the assertion that NZSA needs a full-time research officer.

This study would have been much improved had the author con-centrated on why particular mechanisms for overseeing the profession of accountancy in New Zealand arose rather than on why modes of operations, that the author prefers, have not been implemented. “Traditions and axioms, sometimes without explicit recognition, reflect the nature of the environment within which they emerge.”1 One of the roles of history is to provide explicit recog-nition to formerly ill-understood links of social causality.

The first chapter of this treatise relates how the four accounting bodies in New Zealand merged into one. This is done by giving their names and dates of existence. There is also a capsule sum-mary of NZSA’s current organizational structure.

Chapter V gives cursory descriptions of the New Zealand finan-cial press, Financial Executives Institute, stock exchange, share-brokers, Registrar of Companies, and debenture trust deeds. This chapter, however, fails to delineate how these forces have impinged on the way NZSA has comported itself.

The three chapters interposed between I and V contain the book’s main line of argument. They describe how NZSA slowly came to form an Accounting Practice and Procedure Committee which in its ten-year life produced no original accounting work (p. 25). This committee was superseded in 1960 by a Board of Research and Publications that was unable to get any of its promulgations accepted as mandatory until 1973. These chapters constantly emphasize the fact that NZSA has been and still is demonstrably unwilling to hire a full-time research officer.

The last chapter is an extended recommendation that NZSA de-velop an organizational element powerful enough to impose uni-formity of practice as has become the mode in the United States. This is an unwarranted stance considering the relatively small size of NZSA, its tradition of sponsoring research competitions and uni-versity chairs, and the oft expressed opposition of NZSA members to any infringement on their professional autonomy. The author’s recommendation also seems contradictory because he has ob-served elsewhere that “Instead of providing ‘an underlying frame-work’ for the promulgation of ‘sound’ financial reporting practices by standard setting boards, accounting theory has proven a useful ‘tactic’ to buttress one’s preconceived notions.”

Many of the faults of this work result from the choice of the author’s own research methodology3 and the neglect of others that have worked well. For example, the delightful prose and insightful highlighting of personalities that makes the historical narratives of John L. Carey great literature (e.g. Carey, 1969) is missing. Edward Stamp is described as “. . . an apostle of North American practice . . . [who] left an indelible mark in New Zealand” (p. 87), yet neither the man nor his influence is described. Particularly nettling are the author’s suppositions on why Stamp took the position he did on deferred tax accounting.

Most of the space in this work is occupied by people’s names, the dates that they joined or left some committee, and place of various committees within NZSA’s organizational structure. Line and block charts could have greatly clarified these changing situations. Such charts were used with devastating effect in the Met-calf report to display the power structure within the AICPA.

What can be inferred from the study here reviewed is that there has never been sufficient government pressure in New Zealand to invoke a search for accounting principles. As a result the cost of cosmetic research to provide politically acceptable justification for nonexistent externally imposed demands for homogeneity of ac-counting practice has been viewed in New Zealand as prohibitive and unacceptable (p. 6).

FOOTNOTES

1McCracken, p. 4.
2Zeff, “Comments on ‘Accounting Principles—How They Are Developed,’ ” p. 177.
3See Zeff, Forging Accounting Principles in Five Countries and Zeff, Forging Accounting Principles in Australia.
Subcommittee on Reports, Accounting, and Management, pp. 3, 72, and 137.

BIBLIOGRAPHY

Carey, John L. The Rise of the Accounting Profession. New York: American Institute of Certified Public Accountants, 1969,
McCracken, Paul W. “Inflation, Profits, and the American Economy,” in Paul A. Griffin, ed. Financial Reporting and Changing Prices: The Conference. Stamford, Conn.: Financial Accounting Standards Board, 1979, pp. 3-14.

Subcommittee on Reports, Accounting, and Management. The Accounting Estab-lishment. Sen. Doc. No. 95-34, 95th Cong., 1st Sess., March 31, 1977.
Zeff, Stephen A. “Comments on ‘Accounting Principles—How They Are Developed,’ ” in Robert R. Sterling, ed. Institutional Issues in Public Accounting. Lawrence, Kan.: Scholars Book Co., 1974, pp. 172-178.

90 The Accounting Historians Journal, Spring, 1981
Forging Accounting Principles in Australia. Melbourne,
Australia: Australian Society of Accountants, 1973.
Forging Accounting Principles in Five Countries: A His-
tory and an Analysis of Trends. Champaign, III.: Stipes Publishing Co., 1972