Cultural Inertia and the Causes of Accounting Diversity

• In Event: Gender and Diversity

Abstract

The nature and extent of current accounting diversity has been studied by Nobes (1983) and Zarova (2017). This paper examines the causes of diversity by tracing factors that have influenced and encouraged the evolution of accounting diversity. This is presented by tracing backwards from accounting through business practices, culture, history, to the geography that originally separated communities from each other. The ideas build upon the seminal works of economic history of Heilbroner and Milberg (2012), as well as Hofstede (1984) and Hofstede and Bond (1984a 1984b) on cultural characteristics and extends the work of Gray (1988) on the cultural influence on accounting systems. A Cultural Inertia (CI) model is developed that uses the three factors of isolation (I), population density (D), and time (T) to describe the likely strength of cultural inertia, which reinforces the likelihood of maintaining alternate accounting methodologies. The model is applied to demonstrate the potential for predicting resistance to the ongoing accounting convergence process

Author

• John Edward Simms, University of St. Thomas