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Article
Publication date: 21 October 2013

Prem Sikka and Hugh Willmott

– The paper aims to examine the involvement of global accountancy firms in devising and selling tax avoidance schemes euphemistically marketed as “tax planning”.

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5214

Abstract

Purpose

The paper aims to examine the involvement of global accountancy firms in devising and selling tax avoidance schemes euphemistically marketed as “tax planning”.

Design/methodology/approach

The study draws upon a range of secondary sources, including legal cases and government reports, to demonstrate how “tax planning” involves “wilful blindness” to complicity in dubious and sometimes fraudulent activity.

Findings

The study reveals in detail the construction and promotion of elaborate tax avoidance schemes by big accounting firms. It casts doubt upon the “business culture” that has become established in these firms.

Research limitations/implications

The study relies upon secondary sources. Subject to gaining adequate access to the big accounting firms, research based upon close-up investigation of “tax planning” would further illuminate such practices.

Practical implications

The study shows how normalised and institutionalised “tax planning” schemes have become in the big four accounting firms. It suggests that such schemes require closer scrutiny if payments of tax are to be made as intended, and thereby provide the revenues required to maintain public services such as education, health and pensions.

Social implications

The study informs a debate about the payment of taxes and the role of big accounting firms in creating aggressive tax avoidance schemes. It questions the appropriateness and adequacy of private regulation of these firms and so contributes to a public debate on the tax contribution of comparatively powerful and privileged parties.

Originality/value

The study “blows the whistle” on the role of big accounting firms in devising schemes that reduce the “tax take” on business and thereby reduces the revenues required to provide and maintain public services.

Details

critical perspectives on international business, vol. 9 no. 4
Type: Research Article
ISSN: 1742-2043

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Article
Publication date: 30 October 2019

Florian Gebreiter

The purpose of this paper is to examine the role of graduate recruitment in the professional socialisation and subjectification of Big Four professionals.

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2694

Abstract

Purpose

The purpose of this paper is to examine the role of graduate recruitment in the professional socialisation and subjectification of Big Four professionals.

Design/methodology/approach

The paper draws on documentary data and interviews conducted at one British university. It adopts an interpretive perspective and is informed by Foucault’s work on technologies of power and technologies of the self.

Findings

The paper argues that the graduate recruitment practices of Big Four firms represent a series of examinations which produce the category of ideal recruits. It moreover suggests that this category serves as the ultimate objective of an ethical process whereby aspiring accountants consciously and deliberately seek to transform themselves into the type of subjects they aspire to be – ideal recruits.

Research limitations/implications

The findings of the paper are primarily based on interviews conducted at one university. Future research could explore if students at other universities experience graduate recruitment in similar or different ways.

Originality/value

The paper highlights the constitutive role of graduate recruitment practices and shows that they can construct ideal recruits as much as they select them. It also shows that graduate recruitment is an important anticipatory socialisation mechanism that can compel aspiring accountants to learn how to look, sound and behave like Big Four professionals long before they join such organisations. Finally, the paper discusses its implications for the future of the profession, social mobility and the use of Foucault’s work on technologies of power and the self in studying subjectivity at elite professional service firms.

Details

Accounting, Auditing & Accountability Journal, vol. 33 no. 1
Type: Research Article
ISSN: 0951-3574

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Article
Publication date: 15 February 2008

Prem Sikka

This paper aims to argue that enterprise culture is producing negative effects. Companies and major accountancy firms are increasingly willing to increase their profits…

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6431

Abstract

Purpose

This paper aims to argue that enterprise culture is producing negative effects. Companies and major accountancy firms are increasingly willing to increase their profits through indulgence in price fixing, tax avoidance/evasion, bribery, corruption, money laundering and practices that show scant regard for social norms and even laws.

Design/methodology/approach

The paper locates business behaviour within the broader dynamics of capitalism to argue that hunger for higher profits at almost any cost is not constrained by rules, laws and even periodic regulatory action.

Findings

The paper uses publicly available evidence to show that accountancy firms are engaged in anti‐social behaviour. Evidence is provided to show that in pursuit of higher profits firms have operated cartels, engaged in tax avoidance/evasion, bribery, corruption and money laundering.

Practical implications

The paper seeks to bring the anti‐social activities of accountancy firms under scrutiny and thus extend possibilities of research in social responsibility, ethics, accountability, claims of professionalism, social disorder and crime.

Originality/value

It is rare for accounting scholars to examine predatory practices of accounting firms. It shows that predatory practices affect a variety of arenas and stakeholders.

Details

Accounting, Auditing & Accountability Journal, vol. 21 no. 2
Type: Research Article
ISSN: 0951-3574

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Article
Publication date: 31 July 2014

Anna Samsonova-Taddei and Christopher Humphrey

The accounting regulation literature has recently devoted a significant degree of attention to delineating the roles of accounting firms as key professional actors in the…

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2631

Abstract

Purpose

The accounting regulation literature has recently devoted a significant degree of attention to delineating the roles of accounting firms as key professional actors in the transnational policy arena. Such a heightened level of scholarly engagement with firms seems to have shifted the focus away from the roles of the national professional institutes. The purpose of this paper is to demonstrate the importance of not losing sight of the national professional bodies as important players on the transnational governance scene.

Design/methodology/approach

The accounting regulation literature has recently devoted a significant degree of attention to delineating the roles of accounting firms as key professional actors in the transnational policy arena. Such a heightened level of scholarly engagement with firms seems to have shifted the focus away from the roles of the national professional institutes. The aim with this paper is to demonstrate the importance of not losing sight of the national professional bodies as important players on the transnational governance scene.

Findings

The paper provides empirical illustrations and discussion of the transforming agendas and strategies of influence pursued by various national professional bodies as they attempt to reinvent themselves to face up to the challenges of the changing regulatory landscape. Specifically, the paper analyses a range of activities where such bodies are seen to be competing with each other as well as partaking in a variety of collaborative initiatives in their quest to gain/maintain the status of a global/regional professional thought leader.

Practical implications

The paper is designed to encourage renewed academic debate on the roles and strategies of national professional institutes and highlight opportunities and venues for future research. The paper is also suggestive of the need to refine conceptual perspectives on professionalization processes operational in transnational settings.

Originality/value

The accounting literature is lacking in terms of contemporary study of national professional bodies as active institutions with global ambition and strategies of influence. This paper addresses such a shortcoming by analysing the strategic intent and actions of a range of such bodies (revealing, in the process, a quite fascinating complex of activity, competition and cooperation) and calling for a renewed focus on national professional bodies as a way of enhancing contemporary understanding of the workings of the “global accounting profession”.

Details

Accounting, Auditing & Accountability Journal, vol. 27 no. 6
Type: Research Article
ISSN: 0951-3574

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Article
Publication date: 19 October 2015

Carlos Ramirez, Lindsay Stringfellow and Mairi Maclean

The small accounting practice, despite being the most numerous part of the profession by number of firms, remains largely under-researched. Part of the reason the small…

Abstract

Purpose

The small accounting practice, despite being the most numerous part of the profession by number of firms, remains largely under-researched. Part of the reason the small practice category remains elusive is that researchers find it difficult to precisely define the object to study, and yet, this may be precisely the reason for studying it. Envisaging how this category is “represented” in institutionalized settings, constitutes a rich agenda for future research as it allows the small practitioner world to be connected to the issue of intra-professional segmentation. The paper aims to discuss these issues.

Design/methodology/approach

This paper proposes reinvigorating research around Bucher and Strauss’ (1961) conceptualization of professions as “segments in movement”. At the same time as advocating a better investigation of the small practitioner segment itself, it suggests to take the latter as an example to further explore the vision of professions as segments “more or less delicately held together”. To this end, there is a potential for cross-fertilization between Bucher and Strauss’ research programme and a range of other theoretical frameworks.

Findings

The discussion points towards how small practice, as a segment whose history and characteristics reflect the different struggles that have led to the creation of the professional accounting body and marked its subsequent evolution, is far from insignificant. Segmenting the profession in categories related to “size” offers an opportunity to deal with an under-investigated aspect of professions’ sociology and history, which encapsulates its inherent diversity and hierarchy. Whilst the professional body may replicate the hierarchy that structures broader society, the meaning of small itself, within a hierarchy of organizations, is also a relative concept. It is politically charged, and must be delicately managed in order to maintain harmony within the polarized professional space.

Originality/value

The small practitioner has been much overlooked in the accounting literature, and the literature on the professions has overemphasized aspects of its cohesiveness. The authors contribute a revitalized agenda for researchers to explore the dynamics of heterogeneity and unity in the professional body, by focusing a lens on the small practice and extending the “segments in movements” premise beyond the functional division of professions.

Details

Accounting, Auditing & Accountability Journal, vol. 28 no. 8
Type: Research Article
ISSN: 0951-3574

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Article
Publication date: 7 June 2021

Rabih Nehme, Amir Michael and Jim Haslam

A survey is here systematically conducted to analyse auditors’ perceptions of dysfunctional auditing behaviour (DAB). As a result of many accounting scandals and…

Abstract

Purpose

A survey is here systematically conducted to analyse auditors’ perceptions of dysfunctional auditing behaviour (DAB). As a result of many accounting scandals and litigations faced by audit firms, this paper aims to assess whether factors leading to DAB are embedded in audit firms’ practices.

Design/methodology/approach

The sample used in this study comprises auditors at all levels of employment with the big four audit firms in the United Kingdom (UK). DAB is analysed using two signals/indicators: premature sign-off and under-reporting of chargeable time. Time budget pressure and time deadline pressure are the factors considered here as potentially pushing auditors to exhibit DAB. A careful and considered analysis and interpretation is here articulated. Additionally, the sample individuals are divided into audit trainees and experienced auditors to assess any potential differences in the perception of DAB that reflect the experience factor.

Findings

Coordination with internal auditors, different perceptions between audit trainees and experienced auditors of dysfunctional behaviour, working during their personal time and the box-ticking exercise are amongst the findings that may help practitioners to understand the reasons behind dysfunctional behaviour and identify measures to mitigate it.

Originality/value

The study can aid concerned executives and audit partners to minimise DAB related to different time pressures by casting light on the key ethical issues. The study is conducted on a sample of the big four firms in the UK covering all organisational structure. It assesses if experience plays a role in the perception of DAB.

Details

Meditari Accountancy Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2049-372X

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Article
Publication date: 28 March 2008

Prem Sikka

The purpose of this paper is to seek to illuminate some of the dynamics of globalization that enable capital to advance its interests.

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2908

Abstract

Purpose

The purpose of this paper is to seek to illuminate some of the dynamics of globalization that enable capital to advance its interests.

Design/methodology/approach

The paper uses theories of globalization focusing upon the “race‐to‐the‐bottom”. Such theories draw attention to the way major businesses are using their power to secure advantages, often by playing‐off one nation state against another. Increasingly, offshore financial centres (OFCs) are becoming key players in this race. The paper uses a case study relating to the enactment of limited liability partnership (LLP) in Jersey, a UK Crown Dependency. The legislation was financed and developed by the UK firms, Price Waterhouse and Ernst & Young in collaboration with a network of advisers.

Findings

The paper sheds light on the resources deployed by major accountancy firms to secure conditions necessary for the smooth accumulation of private wealth and power. Accountancy firms used OFCs or microstates to reposition the state‐capital relationship in globalization and reconfigure the UK auditor liability laws. The paper also highlights the importance of the state to capital and globalization.

Research limitations/implications

In common with major capitalist enterprises, accountancy firms rarely provide background material to explain how they advance their interests. Inevitably, this limits the analysis. Nevertheless, the case study shows some trajectories that have enabled accountancy firms to advance their economic interests.

Practical implications

The paper shows that accountancy firms are able to use novel tactics to advance their interests and that national regulation cannot easily be understood without consideration of the wider international context.

Originality/value

Accounting researchers have rarely focused upon the use of offshore financial centres by major accountancy firms to advance their interests. It also shows that the local and the global are intertwined.

Details

Accounting, Auditing & Accountability Journal, vol. 21 no. 3
Type: Research Article
ISSN: 0951-3574

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Article
Publication date: 1 May 2006

Elisabeth Longuenesse

The purpose of this study is to sort out what was at stake in the fierce debates that raged after 1995 among Lebanese accountants about the conditions of membership to…

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1616

Abstract

Purpose

The purpose of this study is to sort out what was at stake in the fierce debates that raged after 1995 among Lebanese accountants about the conditions of membership to their new association.

Design/methodology/approach

It fits within the recent development of the sociology of professions. But, because of the specific nature of accountants expertise, it is also concerned with broader societal issues and socio‐political negotiation of interests, which underlie professional battles. Finally, to understand what is at stake today, past legacies, struggles and competitions had to be taken into account.

Findings

Before the creation of the LACPA in 1995, there was no unified accounting profession in Lebanon. Two bodies represented two types of work and practice (small offices doing mainly accountancy and fiscal consulting and service v. Anglo‐Saxon‐oriented and English‐speaking audit and accountancy practices). After 1995, although the new body welcomed OECF's advices, it could not adopt its principles. The absence of a high level degree in accountancy (comparable with DESCF), the diversity of academic trainings made it necessary for LACPA to have its own certification exam. But conflicting Anglo‐Saxon and French legacies will soon be absorbed in global change where economic governance is now submitted to the hegemony of financial markets.

Research limitations/implication

The Lebanese case also reveals specific dimensions. The professional field is structured by overlapping conflicts of interest and power struggles which are simultaneously professional, social, cultural, and political.

Originality/value

It gives new insights into the accountancy profession in a non‐industrial country, and has interesting theoretical implications for the sociology of professions and for political economy.

Details

Society and Business Review, vol. 1 no. 2
Type: Research Article
ISSN: 1746-5680

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Article
Publication date: 2 February 2021

Adriana Tiron-Tudor, Delia Deliu, Nicoleta Farcane and Adelina Dontu

The purpose of this paper is to facilitate blockchain innovation immersion in accountancy organizations by providing tools that allow organizations to manage the change…

Abstract

Purpose

The purpose of this paper is to facilitate blockchain innovation immersion in accountancy organizations by providing tools that allow organizations to manage the change. The paper approaches blockchain technology (BT) through the lens of organizational change management, with a specific focus at the organization level.

Design/methodology/approach

A hybrid systematic literature review of relevant literature is presented based on recent research papers published in highly ranked scientific journals that capture how accounting organizations might manage the changes induced by BT.

Findings

The findings of the review indicate that implementing BT requires some new modus operandi. From individual behavior to organizational structure, the advantages of blockchain must be emphasized in all accounting and auditing organizations. Managers should forge a plan that takes advantage of employees' skills, competencies and talent, implementing forward-looking company procedures and actively deciding how to navigate workplace dynamics, personalities and responsibilities.

Research limitations/implications

The main limitations of the study refer to the infancy of the BT and require the development of knowledge through future studies to allow a more accurate outline of the overall picture and a detailed one of the BT phenomena with applicability to accounting and auditing. At this stage, it is not yet possible to fully envision the implications of BT on professional accounting and auditing organizations. However, there will be clients who adopt BTs, so firms should work with them to understand BT-based accounting and auditing applications. That is, accounting and auditing organizations should expand their skills and knowledge to anticipate and meet clients' needs.

Practical implications

In a constantly digitalizing world, the traditional accounting and educational environment is changing but not quickly enough to meet the requirements of a blockchain accounting system yet. For this reason, practical implications on the daily activities of the organizations and the restructuration of their internal architecture have been revealed in this paper.

Originality/value

The paper approaches blockchain using the lens of organizational change management with a specific focus on the accounting and audit organizations, and it proposes solutions to cope with the arising technological challenges. A challenge itself is the implementation of blockchain, especially when an entity is not ready for the process. Therefore, the SWOT analysis elaborated in this paper and focused on the accounting and auditing firms is an element of novelty and at the same time, a helpful tool highlighting the main strengths, weaknesses, opportunities and threats of this technology, supporting organizations in assessing how ready they are for its adoption. The research on blockchain in accountancy organizations is still necessary for at least seven key areas which have been proposed and detailed at the end of the paper, bringing in this way clarity in regards to the most endorsed avenues for future research directions.

Details

Journal of Organizational Change Management, vol. 34 no. 2
Type: Research Article
ISSN: 0953-4814

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Article
Publication date: 19 May 2021

Khaldoon Albitar, Habiba Al-Shaer and Mahmoud Elmarzouky

The COVID-19 pandemic has been adding pressures on companies to commit to their social and ethical responsibilities. Corporate social responsibility (CSR) reporting is the…

Abstract

Purpose

The COVID-19 pandemic has been adding pressures on companies to commit to their social and ethical responsibilities. Corporate social responsibility (CSR) reporting is the main tool through which companies communicate their social behaviour and the need for credible information is censorious during the crisis. This paper aims to measure the level of COVID-19 disclosures in CSR reports by using an automated textual analysis technique based on a sample of UK companies and investigate whether the level of disclosure is enhanced for companies that subject their CSR reports to an assurance process.

Design/methodology/approach

The study sample consists of FTSE All-share non-financial listed companies. The authors use a computer-aided textual analysis, and we use a bag of words to capture COVID-related information in the CSR section of the firm’s annual reports.

Findings

The results suggest that the existence of independent external assurance is significantly and positively associated with the provision of COVID-19 information in CSR reports. The authors also find that when assurance is provided by Big 4 accountancy firms, the disclosure of COVID-related information is enhanced. Furthermore, large companies are more likely to disclose COVID-related information in their CSR reports that are externally assured from top-tier accountancy firms, suggesting that assurance could be a burden for smaller firms. Overall, the findings suggest that assurance on CSR reports provides an “insurance-like” protection that mitigates the risks and signals the management’s ethical behaviour during the pandemic.

Practical implications

The study approach helps to assess the level of corporate engagement with COVID-19 practices and the extent of related disclosures in CSR reports based on the COVID-19 Secure Guidelines published by the UK government. This helps to emphasise how companies engage and communicate COVID-19-related information to stakeholders through CSR reports and ensure a safe working environment during this pandemic. Managers will need to assess the costs and benefits of purchasing assurance on CSR disclosures, giving the ethical signal that assurance sends to the market and protection that it covers during the crisis.

Originality/value

This paper provides a shred of unique evidence of the impact of the existence of external assurance and the type of assurer on the disclosure of COVID-related information in CSR reports. To the best of authors’ knowledge, no study has yet investigated the corporate disclosure on an unforeseen event in CSR reports and the role of CSR assurance in this respect.

Details

International Journal of Accounting & Information Management, vol. 29 no. 3
Type: Research Article
ISSN: 1834-7649

Keywords

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