ACCOUNTING HISTORY AND ACCOUNTING PROGRE

ACCOUNTING HISTORY AND ACCOUNTING PROGRESS

Christopher J. Napier University of Southampton

Correspondence Address: School of Management

University of Southampton Highfield Southampton SO17 1BJ United Kingdom

cjn@socsci.soton.ac.uk

Paper presented at the Second Accounting History International

Conference, Osaka, Japan, 8-10 August 2001

ACCOUNTING HISTORY AND ACCOUNTING PROGRESS ABSTRACT

A. C. Littleton famously described accounting as “relative and progressive”. However, in recent historical accounting research, there has been increasing hesitation in describing accounting as “progressing”. This is largely because “progress” implies a degree not only of change but also of improvement, and historical accounting researchers, influenced by social science conventions, often regard describing accounting changes in terms of progress as involving improper value judgements. As accounting becomes an object of study less as a technical and more as a social phenomenon, consensus as to what constitutes an improvement becomes harder to secure.

Within so-called “traditional” historical accounting research, use of a progressive narrative framework is not uncommon, although writers often describe accounting change as “evolution”. This term has multiple meanings and connotations, ranging from a simple view of slow and gradual change to a teleological view of history tending towards some ultimate end or goal. In some interpretations, evolution is seen as inherently progressive, while in others no claim to progress is made. In assessing the work of historical accounting researchers, care is necessary to ensure that their use of models of evolution or progress is accurately understood.

On a broader scale, the idea of progress has been seen as characterising modernity. If accounting is itself regarded as progressive in the sense that the spread of accounting into ever-increasing contexts is regarded as

a social improvement, then accounting is an important phenomenon of modernity. With the emergence of the

post-modern critique of modernity, it is therefore not surprising that accounting comes under criticism, and its diffusion is no longer seen as evidence of progress. However, progress remains a useful narrative structure for historical writing, although it has rivals in terms of stories of decline, stasis, and recurrence. Available historical evidence is often open to different post-modern critique of modernity, it is therefore not surprising that accounting comes under criticism, and its diffusion is no longer seen as evidence of progress. However, progress remains a useful narrative structure for historical writing, although it has rivals in terms of stories of decline, stasis, and recurrence. Available historical evidence is often open to different

ACCOUNTING HISTORY AND ACCOUNTING PROGRESS

INTRODUCTION In his pioneering history Accounting Evolution to 1900, A. C.

Littleton describes accounting in the following terms:

Accounting is relative and progressive. The phenomena which form its subject matter are constantly changing. Older methods become less effective under altered conditions; earlier ideas become irrelevant in the face of new problems. Thus surrounding conditions generate fresh ideas and stimulate the ingenious to devise new methods. And as such ideas and methods prove successful they in turn begin to modify the surrounding conditions. The result we call progress. (Littleton 1933: 361)

Littleton is not particularly clear as to what he means by “progress”, although he implies that it lies in the ability of accounting to solve present-day problems. Littleton notes that accounting has not been static, and points to the growth in

professional audits and the expansion of cost accounting as evidence of how accounting helps to solve problems of business planning and control. He claims to show how “accounting originated in known circumstances in response to known needs; it has evolved and grown in harmony with its surroundings; its changes can be explained in terms of forces current at the time” (Littleton 1933: 362). Littleton’s historiography is a dynamic one: accounting “came from definite causes; it moves toward a

definite destiny” (Littleton 1933: 362). For a long time, I have found this view of accounting change

a puzzling one. It seems to embody a teleology: a belief that

accounting has some ultimate end to which it is tending. The path

to this ultimate end may not be a direct one, which suggests that to this ultimate end may not be a direct one, which suggests that

ultimate end, what could it be? In my own studies of accounting’s history, I have passed through various stages from an initial idealism, ready to believe that accounting can and does change for

the better, to a more sceptical position, unsure whether it makes sense to describe accounting as “progressive” and to talk of “accounting progress” at all.

This paper is therefore an attempt to explore what might be

meant by describing accounting as “progressive”. I shall undertake this exploration by considering what roles a notion of progress might play in historical research more generally and historical accounting research more particularly. This requires a review of the extent to which accounting historians have in the past appealed to notions of progress. Although there is some evidence of the use of progress as an organising concept in so- called “traditional accounting history”, it tends to be tied up

with the highly ambiguous notion of evolution. The emphasis placed on evolution as a term describing accounting’s patterns of change has been criticised by the so-called “new accounting history” (Miller et al. 1991; Miller & Napier 1993), but, as

Keenan (1998) has pointed out, this criticism may itself be open to question as presupposing a rather specific and potentially confused understanding of the concept of evolution. Nervousness Keenan (1998) has pointed out, this criticism may itself be open to question as presupposing a rather specific and potentially confused understanding of the concept of evolution. Nervousness

approach) come from social science backgrounds, where claims that evidence reveals a pattern of improvement over time might be held to be inappropriate value judgements. However, telling a story in terms of progress is often an effective way of structuring a

small-scale historical narrative, whether we describe a “success” in which accounting, or something affected by accounting, is held to improve, or a “failure” from which we hope to learn lessons to help us avoid mistakes in the future. On a larger scale, it

becomes more difficult to tell a story of progress, as we seem to have to choose between the equally unattractive options of seeing accounting as eternally changing in a generally improving direction or as tending towards its end.

PROGRESS IN HISTORY AND HISTORY AS PROGRESS

A dictionary definition of progress is: “An advance to something better or higher in development” (Chambers English Dictionary

1990: 1168). This definition brings out the two central aspects of progress. First, it is a dynamic concept: a necessary

condition for progress is that there should be some change. However, change is not a sufficient condition: the change must be

a change for the better. Progress can be seen as a process of more-or-less continuous improvement, and may in addition be regarded as progress towards some goal or end. Thus the a change for the better. Progress can be seen as a process of more-or-less continuous improvement, and may in addition be regarded as progress towards some goal or end. Thus the

characteristic of the eighteenth century Enlightenment in Europe, exemplified by such writers as the Marquis de Condorcet, who in the middle of the French Revolution set out his Sketch for a Historical Picture of the Progress of the Human Mind (Condorcet

1955). An enlightenment view of history as universal progress was expressed by Edward Gibbon in The Decline and Fall of the Roman Empire, where he drew “the pleasing conclusion that every age of

the world has increased, and still increases, the real wealth, the

happiness, the knowledge, and perhaps the virtue, of the human race” (quoted in Carr 1964: 111). 1

As a philosophical idea, progress is particularly associated with Kant and Hegel. In his essay “An Idea for a Universal History from a Cosmopolitan Point of View”, written in 1784, Kant proposed that:

The history of the human race as a whole can be regarded as the realisation of a hidden plan of nature to bring about an internally – and for this purpose also externally – perfect political constitution as the only possible state within which all natural capacities of mankind can be developed completely. (Quoted in Burns & Rayment-Pickard 2000: 55)

The view of Kant that humanity’s history is a movement towards some ideal state was developed by Hegel, who saw progress as being achieved through conflict between and within ideas and political systems. These would fall apart through their internal contradictions and be replaced by higher forms through a The view of Kant that humanity’s history is a movement towards some ideal state was developed by Hegel, who saw progress as being achieved through conflict between and within ideas and political systems. These would fall apart through their internal contradictions and be replaced by higher forms through a

history”. Hegel’s view of a “universal history” had many unattractive features, as he considered that:

The History of the World occupies a higher ground than that on which morality has properly its position. . . . What the absolute aim of Spirit requires and accomplishes – what Providence sees – transcends the obligations and liability to imputation and the ascription of good or bad motives, which attach to individuality in virtue of its social relations. . . . Moral claims that are irrelevant must not be brought into collision with world-historical deeds and their accomplishment. (Hegel 1956: 66-67)

As filtered through Marx and then later both Fascism and Communism, this philosophy that history overrode morality was to provide a justification for many subsequent acts of brutality (Fukuyama 1992: 69). However, the implication that progress was inevitable was to appear in a more benign light in nineteenth century Britain, where rapid social and economic change could be made to seem less threatening by locating contemporary developments within a broader narrative of progress and, as the

nineteenth century unfolded, a story of evolution. Peter Bowler, in his study of the Victorians’ relationship with the past The Invention of Progress (1989), notes how

narratives of evolution emerged not only in historical writings

but also in a wide range of contexts, and suggests that evolution provided “a general progressive scheme designed to create order out of chaos” (Bowler 1989: 5). Belief in progress was a badge of but also in a wide range of contexts, and suggests that evolution provided “a general progressive scheme designed to create order out of chaos” (Bowler 1989: 5). Belief in progress was a badge of

towards contemporary British society, with past institutions and practices being interpreted as primitive precursors of those found in the more developed present. This approach to historical writing was subsequently to be described by Herbert Butterfield

(1931) as “Whig History”. Historians would identify the favourable factors that allowed Britain to develop in the fortunate ways that it did, while social scientists could elucidate the underlying laws of progress in society, which might

be expected to turn out to be a generalisation of the Whig interpretation of history (Bowler 1989: 27). After World War I, the optimism that had supported a general notion of progress tended to be replaced by a more pessimistic viewpoint. In his study The Idea of Progress, first published in 1920, J. B. Bury tried to uphold the value of progress as “the animating and controlling idea of western civilisation” (Bury 1920: viii), but could not entirely sustain an optimistic outlook. Oswald Spengler’s The Decline of the West (1926) saw in human

history not a continuous trend of improvement but rather a recurrence of cycles of growth and decay. Civilisations had a “beginning”, a “middle” and an “end”. While there are echoes here

of Hegel’s dialectic, to Spengler it was less clear that the succeeding civilisations embodied a pattern of constant improvement. Indeed, it might make little sense to compare, for of Hegel’s dialectic, to Spengler it was less clear that the succeeding civilisations embodied a pattern of constant improvement. Indeed, it might make little sense to compare, for

but we would have no rational basis for considering its replacement as better or worse than what went before.

This incommensurability of civilisations became particularly significant as an argument against concepts of progress, as

historians and others became increasingly conscious of the danger of ethnocentrism in the writing of “universal histories”. The tendency of nineteenth century Whig history to take Victorian Britain as normative, and the later tendency of so-called

“modernisation theory” (Nisbet 1969) to do the same for the USA in the twentieth century, increasingly came under attack from those who “questioned the very concept of modernity itself, in particular whether all nations really wanted to adopt the West’s liberal democratic principles, and whether there were not equally valid cultural starting and end points” (Fukuyama 1992: 69). With the growing influence of social science on historical research, particularly research into cultural development, using concepts of

progress (and indeed of decline) was seen as requiring researchers to make inappropriate value judgements as to what constituted improvement or worsening. In a homogeneous culture, such judgements would reflect a consensus and would not only go

unchallenged but most likely would not consciously appear to be judgements at all. As cultures became more heterogeneous, the description of a particular change as progressive appeared unchallenged but most likely would not consciously appear to be judgements at all. As cultures became more heterogeneous, the description of a particular change as progressive appeared

contested. One area in which a concept of progress appeared to be still viable was science. An important contribution to our understanding of scientific progress is provided by the philosopher of science Larry Laudan, in his book Progress and its Problems (1977). Laudan argues that the adequacy of a scientific

theory or research programme lies in its ability to solve scientific problems. If two theories are compared, one of which

solves more and “weightier” problems than the other, then the first theory can be regarded as better than the second. Laudan claims that:

Given that the aim of science is problem solving . . ., progress can occur if and only if the succession of scientific theories in any domain shows an increasing degree of problem solving effectiveness. (Laudan 1977:

68, italics in original deleted). This focus on problem-solving might provide a way of conceptualising progress in other disciplines and practices, and arguably has already been reflected in historical studies of

accounting by Littleton (1933). Laudan notes that many philosophers and historians of science have regarded science (in actuality or as an ideal) as a cumulative system of knowledge.

This means that new theories are capable of solving not only the problems solved satisfactorily by earlier theories but also a set of additional problems. A notable exception is Thomas Kuhn

(1962), who suggests that later theories can be incommensurable with earlier theories. One aspect of this is that some at least of the problems of earlier theories simply do not exist as

problems within the later theories, not in the sense that they are solved by the later theories, but rather that they are conceptually inexpressible in the terms of the later theories. Laudan attempts to overcome this objection by claiming that progress is not a matter simply of the number of problems solved but also their significance or “weight” (presumably the previously

solved problems inexpressible in terms of the later theories are simply not “weighty” enough to count in an assessment of the later

theories). This move may not be very satisfactory, but the idea that theories (or indeed practices) can be assessed and compared by their ability to fulfil adequately some function may be a potentially promising one when we come to consider progress in accounting.

The idea of progress has been an important feature of Western historiography at least since the eighteenth century, although it came to be questioned in the twentieth century both empirically,

given that civilisation was observed by some to be declining, and methodologically, on the basis that judgements of progress involved making unscientific (and thereby unacceptable) value judgements. However, progress and its associated concept of

evolution have continued to be powerful narrative models for the writing of history. In fact, as the philosopher of history Gordon Graham points out in his book The Shape of the Past (1997), evolution have continued to be powerful narrative models for the writing of history. In fact, as the philosopher of history Gordon Graham points out in his book The Shape of the Past (1997),

believe about the past, and about whether or not the observer would hold the same view at any time in the past. This conceptualisation, by locating judgements at the level of individual preferences, attempts to circumvent the objection that

progress is a value-laden concept. First, there is “uniform progress”, where an observer in the present believes that, for any

time in the past, there is a later time when he or she would prefer to live, and in addition the observer would have held this judgement at any past time. Graham contrasts this with

“evolutionary progress”, where the observer in the present would still believe that for any time in the past there is a later time when he or she would prefer to live, but this view could not be held at all points in the past. In a model of evolutionary progress, the observer believes that recent history shows uniform improvement, but in the past there have been episodes of growth followed by decay. However, in each succeeding cycle of growth

and decay, the best position is an improvement on the best of the previous cycle, and the worst position is also better than the worst of the previous cycle. Finally, Graham describes “revolutionary progress”, where instead of cycles of growth and

decay we have long periods of stasis followed by rapid improvement to a new plateau. Graham expresses a personal preference for decay we have long periods of stasis followed by rapid improvement to a new plateau. Graham expresses a personal preference for

This raises the question of the connection between the

concepts of progress and evolution. The problem here is that the term “evolution” covers a very broad spectrum of meanings. Indeed, Keenan (1998: 652) suggests: “ ‘Evolutionary’ is an adjective with a wide application and anything, perhaps, which

involves processes and outcomes could be so described.” At its simplest, evolution may signal a process of gradual and continuous change, in contrast to revolution. It is used in this sense by Bromwich and Bhimani (1989), in their study of changing developments in accounting inside organisations Management Accounting: Evolution not Revolution. However, most users of

evolution in the context of accounting history are, as Littleton (1933) was, interested in understanding change in a particular domain as a response to changes in other domains. Here the analogy with biological evolution begins to be drawn.

This analogy is taken further when the outcome of some process of change is presented as a result of a variant of

“natural selection”. For example, a change in the economic environment may give rise to new problems that call forth in some way a range of possible solutions. The solution that ends up predominating might be considered to do so through a process of

the “survival of the fittest”. At one level, this may be a satisfactory explanation for the observed outcome. I would, however, suggest that historians will not be satisfied with the “survival of the fittest”. At one level, this may be a satisfactory explanation for the observed outcome. I would, however, suggest that historians will not be satisfied with

also Napier 1987: 244) but rather will wish to demonstrate how the outcome actually is superior to its rivals. The assumption that “what is observed is fittest” has been challenged recently by Hoskin & Macve (2000: 105), who claim:

To say, as [economic rationalists] tend to, that the routines found in the archive mist have represented the optimal trade off of costs and benefits (given the decision-making and other uses that economic rationalists wish to attribute to such routines) is empirically empty and essentially tautological. What is still generally missing is an historical explanation for why particular routines and their subsequent

modifications were the ones that were actually chosen and why consideration/experimentation was not given to possible alternatives that may have been even more cost- beneficial.

Analogies with biological evolution also become complex when some goal or end to the evolutionary process is imputed. One of the ways in which nineteenth century Christianity tried to accommodate itself to the emerging biological theory of evolution was to claim that evolution was simply the mechanism by which the world was moving towards the completion of God’s plan (Ruse,

1999). The secular variant of this saw evolution as the mechanism by which society progressed (Brewer, 1989). Evolution was broad enough as a concept to accommodate a range of positions from extreme laissez-faire (for example, the “social Darwinist” views

of Herbert Spencer and others) to more interventionist views such as those of the Fabians and Progressivists. To some, evolution is seen as driving the world towards some desired end point (it is of Herbert Spencer and others) to more interventionist views such as those of the Fabians and Progressivists. To some, evolution is seen as driving the world towards some desired end point (it is

to be a path of improvement from simple organisms through increasingly complex ones to the ultimate sentient organism.

However, it is by no means necessary to a theory of evolution that it embodies any presupposition of increasing or decreasing

complexity. Indeed, most modern biological views of evolution (see for example Smith 1993) tend to combine a “local” perspective whereby species in particular environmental niches become dominant because of particular adaptive advantages with a “global”

perspective whereby changes in the environment are expected to lead to changes in the range and dominance of species in ways that cannot be labelled simply as “progressive”. There is no reason to expect an environmental change to lead to greater complexity in the dominant species.

To sum up, progress has been a central theme in the writing of history in the Western world for over two centuries. A wide range of historians, from the Universal Historians such as Hegel

to the Whig Historians of nineteenth century Britain, saw history itself as essentially progressive. History was written within a narrative framework of progress, demonstrating how problems are solved, challenges overcome and things get better. Metaphors of

evolution were often mobilised, although the equivocal nature of the concept of evolution necessitates care in our interpretation of how contemporaries used the term. In the twentieth century, evolution were often mobilised, although the equivocal nature of the concept of evolution necessitates care in our interpretation of how contemporaries used the term. In the twentieth century,

necessary to see how the concept of progress and its more recent questioning have had an impact on the writing of accounting history and on our understandings of accounting more generally.

PROGRESS IN ACCOUNTING HISTORY

The relationship between accounting and progress raises many

important questions, and I do not have enough time to address all of them in detail. The first of these is the empirical question of how far, if at all, accounting itself is “progressive” in the sense that properly functioning accounting contributes to the improvement of society. Certainly many historians of accounting have recognised – as does Littleton (1933) – that accounting impacts on society, and an idealistic view of accounting is that it has the potential of contributing to social improvement through

its embodiment of rational calculation. If we pay attention, as did Max Weber among others, to “the ways in which particular forms of calculation help to bring about the rationalisation of the conduct of life in the sphere of the enterprise and more

generally” (Miller & Napier 1993: 635), and we see such rationalisation as in itself progressive, then accounting, as a form of rational calculation, has the potential to be progressive. Of course, if we see the rationalisation of life as a bad thing,

then we will be less likely to regard the spread of accounting as then we will be less likely to regard the spread of accounting as

A second question is what might actually constitute progress within accounting. Understanding progress as meaning change for

the better, this is certainly a central question that must be addressed by the accounting profession and by both governmental and non-governmental regulators of accounting. It arises

implicitly if not explicitly whenever a new or revised accounting or auditing law or standard is proposed. What criteria can we use to decide whether the new regulation is an improvement on the old one, rather than simply being different? Similarly, both

academics and “practical” men and women want to satisfy themselves that the technical innovations they develop actually represent improvements on current ideas and practices. Perhaps such innovators would endorse the view put forward by Laudan (1977) that progress can be assessed in terms of ability to solve more and weightier problems. Mobilising a problem-solving framework, an accounting historian would need to ask at what point in time does a particular problem emerge to which accounting might be a

solution. 2 The pace of innovation in different times and places

could be explained in terms of the emergence at different points of a given problem. For example, the need to account effectively for business combinations emerges as a problem at an earlier time

in countries with highly developed capital markets such as the USA and UK, than in countries where not only the way in which business finance is organised but also the legal structure of complex in countries with highly developed capital markets such as the USA and UK, than in countries where not only the way in which business finance is organised but also the legal structure of complex

In terms of technical progress, claims have been made that accounting has been subject to periods of stagnation or even decline. It would therefore not exhibit the pattern that Gordon Graham (1997) referred to as “uniform progress”, with steady

improvement from period to period. Raymond de Roover (1955: 409) described the period between the publication of Pacioli’s Summa,

the first printed treatment of double-entry bookkeeping, in 1494, and the transition to more sophisticated corporate accounting in

the nineteenth century, as an “Age of Stagnation” (see also Chatfield 1977: 52-61). 3 Edwards (1988: vi), noting that “change

does not, of course, necessarily mean progress”, gives an example of a relative decline in the quality of financial reports published by British companies during the 1920s, as these tended to disclose less than many financial reports published before World War I.

The suggestion that accounting has declined has been associated particularly with Johnson & Kaplan’s Relevance Lost

(1987). In fact, although these authors argue that management accounting systems had become increasingly inadequate in the later twentieth century, they interpret this “as a relatively recent

decline in relevance, not as a lag in adapting older financial accounting systems to modern managerial needs” (Johnson & Kaplan 1987: xii). Accounting methods become obsolescent partly because decline in relevance, not as a lag in adapting older financial accounting systems to modern managerial needs” (Johnson & Kaplan 1987: xii). Accounting methods become obsolescent partly because

for which accounting is the solution changes. Interestingly, this view of decline in relevance incorporates a narrative of technological progress. Both the “Age of Stagnation” argument and the Relevance Lost position are capable of accommodating a long-

run view of progress, as stagnation did not last indefinitely, while the diagnosis offered by Relevance Lost stimulated many

enterprises to make changes in their cost accounting and management systems intended to remedy the decline in accounting’s

relevance (see Johnson 1992). Furthermore, some historians have pointed to a tendency for accounting changes to follow recurring patterns or cycles. Mumford (1979) noted that the various stages in the growth and decline in interest in price-change accounting in Britain over the 1970s reflected closely similar stages in an earlier cycle in the late 1940s. He put forward his cyclical model “as a blueprint for the next surge of inflation” (Mumford 1979: 98), and also in part

as a prediction (subsequently fulfilled) that, with the decline in the rate of inflation, price-change accounting would disappear from the agenda of accounting standard-setters, preparers and users.

A cyclical model has also been proposed by Nobes (1991) for UK standard-setting. 4 Nobes specifically addresses the question as

to whether UK accounting standards in the 1970s and 1980s provided to whether UK accounting standards in the 1970s and 1980s provided

how by implication Nobes identifies progress in accounting with the ability to solve problems, where solution is defined in terms of obtaining “answers” or at least “consensus”. Nobes adopts a rather Hegelian position by proposing that:

Progress may be inferred in the sense that the [standard-setting] structure contained the seeds of its own destruction . . . The inability of the Accounting Standards Committee to identify or to state or to enforce the “right” answer on various issues led to the pressure to replace it with a body that might be better able to manage some or all of these matters. (Nobes 1991: 271).

This illustrates a central problem with using a concept of progress in historical explanation: if we focus on a relatively short period of time we might observe a particular pattern of change (improvement, stasis or decline), but this pattern need not

be the same as that observed over a longer period of time, within which the shorter period is included. This situation is consistent with the “evolutionary progress” model of Graham (1997) already discussed, and it may underlie the relative lack of

explicit statements about progress in much of the traditional writing on accounting history, as against the frequent references to evolution.

However, the “evolutionary progress” model implies one major

belief: that, despite the possibility of setbacks in the past on the road to the present, today’s observer believes that the current state of affairs is preferable to that at most if not all belief: that, despite the possibility of setbacks in the past on the road to the present, today’s observer believes that the current state of affairs is preferable to that at most if not all

enough to show how several such historians say very little about the current state of affairs at the time they were writing. Thus Littleton, writing in 1933, brings his book to a close in 1900. Garner, whose classic work Evolution of Cost Accounting to 1925

includes no fewer than nine chapters on the “evolution” of particular features of costing, wrote in 1954. Lee & Parker, whose collection The Evolution of Corporate Financial Reporting

was published in 1979, include some material touching on events

close to the date of publication, and their main motivation was “inviting the reader to explore certain contemporary problems of accounting through the eyes and pens of historians” (Lee & Parker 1979: viii). However, far from considering the present to be “better” than most times in the past, they contend that “few of the major issues of today are unique. In fact, . . . they are often many decades old, and no nearer solution today than they were when first mooted” (Lee & Parker 1979: viii).

Perhaps the most significant advocate of evolution as a structure for thinking about accounting history was the American Accounting Association’s Committee on Accounting History, which reported in 1970. This proposed an objective for historical study

firmly in the tradition of “modernisation theory”:

By observing the evolution of accounting thought, practices, and institutions that has corresponded to evolution in the environment (including economic, social, political, and legal factors), it may be By observing the evolution of accounting thought, practices, and institutions that has corresponded to evolution in the environment (including economic, social, political, and legal factors), it may be

Of nine specific “examples of historical studies which deserve

attention”, no fewer than eight contain the word “evolution”. But despite this predominance of evolution, it is unclear whether the Committee on Accounting History meant much more than “process of change”, with some sense that changes in accounting may be a

function of changes in the environment. It is in this sense that more recent historians seem to appeal to evolution. For example, Jones and Aiken (1995), in their study of British company legislation of the nineteenth century, argue that “analysis of

political and social evolution is . . . essential for explaining the timing and development of companies legislation of this

period” (Jones & Aiken 1995: 61). 5

Even if traditional accounting historians have been circumspect about making claims that accounting has progressed, this is how the new accounting historians have tended to characterise their general approach. Thus Funnell (1998: 156) defends new accounting history by claiming that “accounting

history is not the simple story of progressive improvement in response to the emerging needs of society”. The view that traditional accounting history was this simple story of progress

is evident from a number of the precursors of the new accounting

history. We can observe this view being expressed right from the start by the central influence on the emergence of the new accounting history, Anthony Hopwood. He was a member of a history. We can observe this view being expressed right from the start by the central influence on the emergence of the new accounting history, Anthony Hopwood. He was a member of a

away from what it perceived as “technical” towards a more socially informed research agenda. The committee was greatly affected by a perception that change was pervasive in accounting, that accounting change was not well understood, and that, in principle

at least, an understanding of change could be given by historical studies. However, despite a recognition of the substantial body of historical research in accounting that, even in the mid-1970s, had come into existence:

Most members of the committee nevertheless were dissatisfied with not only the present state of knowledge in the area but also the current directions of historical research. There has been a tendency for technical histories of accounting to be written in isolation of their social, economic and institutional contexts. Accounting seemingly has been abstracted from its social domain with many of the understandings that are available tending to present a view of the autonomous and unproblematic development of the technical. Where efforts have been made to offer alternative perspectives, teleological, evolutionary or progressive notions of change have often been implicit in the understandings presented. . . . [M]any members of the committee were concerned about the partial, atheoretical and intellectually isolated nature of much historical work in the accounting area. (Hopwood 1985: 365-366).

Similar views about traditional accounting history are put forward by Hopwood in his later paper “The archaeology of accounting systems” (1987), and by Miller & Napier in their paper

“Genealogies of calculation” (1993). What is most noticeable about these criticisms of traditional accounting history, however, is the almost complete lack of “Genealogies of calculation” (1993). What is most noticeable about these criticisms of traditional accounting history, however, is the almost complete lack of

is open to the objection that many of the examples of traditional historical accounting research provided were rather dated, even at the time the first version of their paper (Miller & Napier 1990) was written. That Littleton in 1933 may have been rather

simplistic in drawing links between social and economic change on the one hand and accounting change on the other, and vague on how accounting fed back to help shape society, does not mean that all traditional historians should be tarred with the same brush.

The key feature of the new accounting history, as stimulated by Hopwood and developed by many others working within a wide number of theoretical perspectives (see for example Miller et al. 1991), is that it is a sociological history written by social

scientists. Hence, it is driven by a desire to theorise and generalise, rather than to particularise. At the same time, the canons of social scientific research, in particular a nervousness about appearing to make value judgements, have a significant

influence on the form of argumentation. This is paradoxical, as many of the new accounting historians have felt distinctly unhappy with what they perceive as the illegitimate dominance of accounting in modern society. It has been argued forcefully by

commentators such as Neimark (1990, 1994) and Armstrong (1994) that this has tended to lead to tensions if not contradictions in much of the new accounting history, particularly that influenced commentators such as Neimark (1990, 1994) and Armstrong (1994) that this has tended to lead to tensions if not contradictions in much of the new accounting history, particularly that influenced

judgements as relative to beliefs and systems of power extant during the period under study. This undermines the possibility of the very critique that is being sought, as there is and can be no independent standpoint from which any critique may be offered that

is immune to accusations that it simply reflects a particular set of values. On the other hand, Foucauldians argue that a Marxist theory of history appeals to Hegelian ideas of Universal History that have long since been exploded.

Perhaps at this stage it is worth appealing to the archive (Fleischman & Tyson, 1997). In an unpublished working paper 6 that

formed the basis of thought on historical accounting research of the 1977 Social Science Research Council committee discussed by Hopwood (1985), Cyril Tomkins set out his view of the development of accounting. This contains a remarkable echo of Littleton (1933). “Developments in accounting came about in the first place in response to economic social and political pressures, but,

thereafter, acted as an enabling device to assist further developments” (Tomkins c.1978: 9, emphasis in original). Moreover, it exhibits a degree of optimism that is often lacking from the new accounting history:

Despite the current criticisms, the long run record of accounting is distinctly encouraging. There have been occasions when accountants may not have reacted quickly enough to the needs of the day’s society – for example the very slow pace (and sometimes backward steps) of increasing disclosure of information through the Despite the current criticisms, the long run record of accounting is distinctly encouraging. There have been occasions when accountants may not have reacted quickly enough to the needs of the day’s society – for example the very slow pace (and sometimes backward steps) of increasing disclosure of information through the

Interestingly, Fukuyama (1992: 70) suggests that the pessimism of the twentieth century may have been overdone: “We need to ask whether our pessimism is not becoming something of a pose, adopted as lightly as was the optimism of the nineteenth century. For a naïve optimist whose expectations are belied appears foolish, while a pessimist proven wrong maintains an aura of profundity and seriousness.” Is there scope for optimism about accounting, and

is it legitimate to tell histories of accounting progress? I consider these issues in the concluding section of this paper.

NARRATIVES OF PROGRESS

Within the study of history more generally, one of the most

important debates in recent years has involved the consideration of the extent to which the writing of history does more than simply provide a “superstructure” (Goldstein 1976: 140-141) necessary to express in words the objective facts of the past. Indeed, does the way in which history is written – the “narrative” of history – actually give meaning to the past (White 1987: 2)? If the latter, is there one “correct” narrative already implicit in past events, or is there the possibility of multiple

narratives, and thus multiple meanings? Warwick Funnell (1998) narratives, and thus multiple meanings? Warwick Funnell (1998)

The historical method consists in investigating the documents in order to determine what is the true or most plausible story that can be told about the events of which they are evidence. A true narrative account . . . is a necessary result of a proper application of historical “method”. The form of the discourse, the narrative, adds nothing to the content of the representation. (White 1987: 27)

The role of the historian is to tell it “as it actually was”. Historians may want to explain why events happened as they did by appealing to some broader theory (and sociologically oriented historians will inevitably wish to take this route), but the

historian’s explanations are separate from the historian’s narratives. Indeed, historians face a tension: a “scientific” as opposed to a “literary” approach to history seems to suggest that putting the historical facts into a narrative framework could lead to the danger of diluting objectivity. The aim of the historian, on this view, is not to “tell a good story” (Napier 1989: 241), but rather to tell the true story.

However, in recent years strong arguments have been put

forward, most notably by Hayden White, that the content and the form of historical narrative are inseparable. Moreover, there is no single true narrative: historical events can be ordered in a narrative – “emplotted” – in different ways. In his seminal work

Metahistory, White proposes a series of standard emplotments 7 that

can be taken by historical narratives: romance, comedy, tragedy and satire. In the romance, the hero of the story triumphs over can be taken by historical narratives: romance, comedy, tragedy and satire. In the romance, the hero of the story triumphs over

satire, whose principal style is irony, it is the world that triumphs: “in the final analysis, human consciousness and will are always inadequate to the task of overcoming definitively the dark force of death, which is man’s unremitting enemy” (White 1973: 9).

Comedy and tragedy, on the other hand, hold out some hope of at least provisional victory over the world, the difference being the form that this victory takes. In comedy “hope is held out for the temporary triumph of man over his world by the prospect of

occasional reconciliations of the forces at play in the social and natural world”, while in tragedy “there are intimations of states of division among men more terrible than . . . at the beginning. Still, the fall of the protagonist and the shaking of the world he inhabits . . . are not regarded as totally threatening to those who survive . . . There has been a gain in consciousness for the spectators” (White 1973: 9).

To White, the choice of emplotment for a historical narrative

is a choice of historical explanation. As the same set of historical evidence is open, at least in principle, to different emplotments, it can be explained in different ways. In a later work, White links emplotment specifically to stories of progress:

When Kant turned to the consideration of what could be known from the study of history, so as to be able to determine what mankind could legitimately hope on the basis of that knowledge, he identified three kinds of equally pertinent conclusions. These were that (1) the human race was progressing continually; (2) the human When Kant turned to the consideration of what could be known from the study of history, so as to be able to determine what mankind could legitimately hope on the basis of that knowledge, he identified three kinds of equally pertinent conclusions. These were that (1) the human race was progressing continually; (2) the human

So a view of general progress is emplotted as comedy, one of decline as tragedy and one of stasis or recurrence as satire.

Comedy and tragedy are common modes of emplotment in traditional accounting history. Any narrative that begins with the identification of some problem (whether this identification is made by the author or is observed in the historical evidence),

sets out the various attempts at addressing the problem, and ends with describing how the problem was solved, would be a comedy in White’s terms. A classic example of this form of narrative is given by Neil McKendrick’s study of Josiah Wedgwood’s cost accounting (McKendrick 1970). Here, Wedgwood is faced with the problem of falling profit margins in a time of economic decline, which he addresses by experimenting with cost estimation procedures. These turn out to be successful, and Wedgwood

persists with them. This is a clear story of progress. However, when Hopwood tells the story of Wedgwood, the conclusion is more equivocal: “Wedgwood now had available to him the basis of a more anonymous and continuous form of surveillance. . . . The newly

established accounting system enabled a different set of dynamics to be set into motion. . . . The organisation could be observed and managed in terms different from those in which it functioned”

(Hopwood 1987: 218). There is a more ironic tone to this: Wedgwood’s innovations may have solved one set of problems from his personal point of view, but they change, not necessarily for

the better, how others in the organisation are affected by organisation’s practices.

Traditional accounting histories may also adopt a mode of tragedy, where an episode of failure is narrated as a “cautionary

tale” from which readers today (and indeed observers in the past) might learn lessons. Arguably, the mode of emplotment in Relevance Lost (Johnson & Kaplan 1987) is one of tragedy (even

though some of the “sub-plots” told along the way may in

themselves have the form of comedy). If American business is seen as the protagonist of the story, then its persistence with costing methods that were increasingly losing their relevance led, for some organisations, to bankruptcy, and for others to serious difficulty. There is, though, a hope that those reading the book will draw lessons from it and change their costing methods to more relevant ones. A satirical or ironic approach to narrating the same events would rule out such hope.

If different emplotments of the same historical evidence are possible, there is no single true historical explanation. Choice of emplotment may reflect personal philosophy: as White points out in the passage quoted earlier, there is an association between

comedy and idealism, tragedy and cynicism, and satire and scepticism. If a sceptical attitude is regarded as the most appropriate for a social scientist to adopt, then it is not comedy and idealism, tragedy and cynicism, and satire and scepticism. If a sceptical attitude is regarded as the most appropriate for a social scientist to adopt, then it is not

decay). This is well illustrated by the study by Peter Miller (1991) of the British government’s advocacy of discounted cash flow (DCF) as a means of increasing the rate of economic growth in the 1960s. Miller is at pains to stress that issues such as the

extent to which DCF was actually adopted, and the extent to which its use helped achieve the government’s objective of faster economic growth, were not the point of his paper, which was to study how a particular issue is “problematised” and how DCF was

mobilised in various programmes. As he concludes: “The ‘failure’ of the idealised programme within which DCF techniques was promoted can be seen as intrinsic to the very nature of such programmes” (Miller 1991: 738). In the final analysis, the world always triumphs: the characteristic emplotment of satire.