ACCOUNTING REGULATIONS: WHO CALLS THE SHOTS? A COMPARISON BETWEEN USA and CHINA

Ahmet TERZİ

Knowledge of accounting is crucial for individuals, commercial organizations, societies and states. This creates endless debates on according to which criteria the knowledge will be produced and presented. The regulations regarding how the accounting knowledge is produced and presented influence the results significantly. That is why investors and dominant ideology put pressure on accounting regulators. Critical accounting literature suggests that such interventions and pressure may vary from one country to another. It discusses that in certain cases, accounting and ideology or accounting and politics get involved in a complex relationship. The reason of this debate actually lies beneath the question that "who will determine the knowledge of accounting, which is the power, and how it will be produces and presented? Another crucial question is whether accounting is a tool used by power. Or is it a science which is manipulated by the dominant ideology and political power? This paper centres on recent scholarly works on the effects of politics and ideology on accounting regulations. Some of the works which are contained by this paper investigate USA politics and accounting relation whereas others examine accounting regulations and ideology in China. The purpose of the paper is to focus on the studies -penned after 2005- which are thought to have explained the multi-dimensional and complicated relationship between accounting and politics\ideology. Thus, it purposely centres on the works allowing the researcher to analyse comparatively the two opposite poles of the economic life of the world, namely USA and China. The paper adopts a descriptive method that summarizes, conveys and introduce the works in question to researchers for discussion and further investigation.

Keywords: Accounting, Politics, Ideologies, Accounting Standards, Accounting Regulations