Professional Documents
Culture Documents
ACCOUNTING AND
ENVIRONMENT
Anis CHARIRI
Reference
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F. Other Influences
Religion
Islamic financial institutions use accounting
standards issued by the Accounting and Auditing
Organization for Islamic Financial Institutions
Accidents of history
The exporting or imposition of accounting rules
or practices by more powerful or sophisticated
societies
Price Waterhouse (from London to NY, Chicago etc)
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DEFINITION
Culture refers to “a set of common ideas, beliefs
and values that shared by the member of a group of
individuals” (Roberts et al., 2002)
Culture is “the collective programming of the mind
which distinguihes the members of one human
group from another” (Hofstede 1984)
So what? CULTURE:
Collective
Not directly observable but can be inferred from
behaviour
Helps differentiate groups
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LEVEL of CULTURE
LEVEL OF CULTURE:
Symbols—with particular meaning
Heroes—characters prized by society
Rituals—routine activities
Values—general beliefs or social norms
SUBCULTURE
Culture exists at many level (ethinic, religious, areas, etc)
Each group will have its own culture
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Structural Elements of
Culture
Hofstede - 4 Underlying societal
dimensions:
Individualism VS Collectivism
Power Distance
Uncertainty Avoidance
Masculinity VS Feminity
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Individualism Collectivism
How a society views and maintains social
relationship among individuals
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Power Distance
How a society handles power inequalities
among people / organizations – distributed
unequally.
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Uncertainty Avoidance
the degree to which the members of society feel
uncomfortable with uncertainty and ambiguity.
The fundamental issue is how a society reacts to the
fact that the future is unknown.
Weak Strong
People feel relatively secure People feel anxious about
and do not try to control future and create
future through laws. More institutions to add security
tolerance for deviant ideas and avoid risk. Associated
and behavior and with formal and informal
willingness to take risks. rules to guide behavior.
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Masculine Feminine
This dimension relates to the division of the
roles between sexes in society.
Masculine Feminine
Societal preference for Societal preference for
showing off, achievement, putting relationships with
heroism, assertiveness, people before money, helping
making money, thinking others, caring for the weaker,
big, etc. Competitiveness. the quality of life, preservation
Concern for equity rather of the environment, “small is
than equality. beautiful” and so on.
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Classification
Dimension A B C D
Power Low High Low High
Distance
Uncertainty Weak Weak Strong Strong
Avoidance
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Individualism + - - -
Uncertainty
Avoidance - + + +
Power
Distance - + NR +
Masculinity vs
Feminity NR NR + +
Accounting
practice mainly Authority Application Measurement Disclosure
influenced
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European Union
Promotes economic integration/harmonization
UN
World Bank
International Monetary Fund
UN conference on Trade and Development
World Trade Organisation
OECD
Foster international economic and social development
in industrialized countries
“Code of Conduct” for MNEs
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SO WHAT?
Accounting is a socially constructed reality
Accounting is influenced by culture,
economic, politics, social forces and interest
Accounting is not universal practice
applicable anywhere
Accounting should be developed based on
unique characteristics of environment in
which accounting take place
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