Influence of National Culture and Other Forces on Accounting and Control

Practices of Bangladesh: A preliminary study.

Abstract
This study attempts to examine the influence of national culture and other forces on
accounting and control practices of Bangladesh by applying Grays 1988
culture/accounting values hypothetical area propositions, chneider and Barsoux
!""# culture/ control profiles and some other alternative theories$ % triangulation of
research methods are follo&ed for this purpose$ %long &ith existing literatures,
annual report analysis for #" listed companies of 'ha(a toc( )xchange *td$ over
the period !"1"+!"1! has been made to test Grays proposition on accounting
practices of Bangladesh$ )vidence from telephone intervie&s, researchers personal
experience and other empirical &or(s are used to validate the ingredients of
chneider and Barsoux control profiles for %sian region and different alternative
theories on accounting and control practices of Bangladesh$ The result sho&s that
Grays all propositions except statutory control, and chneider and Barsoux control
profiles for %sian region are positively confirmed in Bangladesh$ )mpirical &or(s
from other scholars also suggest that several forces li(e institutional pressure, eco+
political conditions and history etc$ are more influential than culture in directing the
course of accounting and control practices in Bangladesh$ The ma,or limitation of this
study is its usage of limited data sets$ The findings &ill be useful in understanding
different forces that are shaping accounting and control practices in a transitional
economy, Bangladesh$
i
Table of Contents
%bstract i$
1$" -ntroduction 1+#
!$" Theoretical Bac(ground of the tudy .+18
!$1 /ulture and %ccounting .+1"
!$! /ulture and 0anagement /ontrol 11+1#
!$# 0anagement %ccounting and /ontrol in Traditional ociety 1.+11
!$. %lternative Theories 12+18
!$1 ummary 18
#$" 3istorical Bac(ground of %ccounting and /ontrol in Bangladesh 19+!#
#$1 3istory of %ccounting in Bangladesh 19+!1
#$! 3istory of 0anagement /ontrol in Bangladesh !!+!#
#$# ummary !#
.$" 4esearch 0ethods and 'esign !.+#1
.$1 -ntroduction !.
.$! 4esearch 0ethods !.
.$# %nalysis of %nnual 4eports !1
.$#$1 %uthority 5ariables !2
.$#$! 'isclosure 5ariables !6
.$#$# /onsistency or 7niformity 5ariables !8
.$#$. 0easurement 5ariables !8+!9
.$. %nalysis of 8ournal and %rticles !9+#"
.$1 -ntervie&s #"+#1
.$2 *imitations of the 4esearch 0ethods #1
.$6 ummary #1
1$" 9indings and %nalysis #!+.2
1$1 Grays /ulture/%ccounting 5alue :roposition and Bangladesh #!
1$1$1$ %ccounting %uthority and Bangladesh #!+##
1$1$! %ccounting and 'isclosure and Bangladesh ##+#.
1$1$# %ccounting 7niformity and Bangladesh #1+#2
1$1$. %ccounting 0easurement and Bangladesh #2
1$! %ccounting in Bangladesh and %lternative Theories #6+#8
1$# /ulture and 0anagement /ontrol in Bangladesh #9+."
1$. 0anagement %ccounting and /ontrol in Bangladesh .1+.!
1$1 0anagement %ccounting and /ontrol practises in Bangladesh and
%lternative Theories
.#+.2
1$2 ummary .2
2$" /onclusions .6+.8
4eferences .9+2!
%ppendices 2#+6.
%ppendix % 2#
%ppendix B 2.+26
%ppendix / 26+28
%ppendix ' 28+29
%ppendix ) 6"+61
%ppendix 9 61+6!
ii
%ppendix G 6!+6#
%ppendix 3 6.
iii
.!: Introduction
:revious researches ;<air and 9ran(, 198"= <obes 198#= Gray 1988> confirm that
accounting is practised differently in different parts of the &orld and the development
of national accounting practises is a function of its environmental factors$ The same
comments are also applicable for management control ;3ofstede 1991= chneider
and Barsoux, !""#>$ %lthough it is hoped that globali?ation, technological
development and improved methods &ill ma(eharmoni?ation of accounting and
management control practises all over the &orld, it is not yet happened due to the
intercultural differences among nations$
These intercultural differences of human behaviour among nations are explored in
different literatures, but mainly in the sociology, psychology and anthropology
literatures ;-n(eles 1929= 3ofstede, 198"= 0assey, 1981>$The 3ofstede seminal &or(
;198"> Cultures Consequences: International Differences in Work Related Valueis
a ground brea(ing concept in studying those underlying cultural structures that
causes differences in &or( related values$ -t triggers research in different disciplines
including accounting and management control such as Gray ;1988>= :erera ;1989>=
9echnerand @ilgore ;199.>= /ho& and *evich ;1991>= tede, A$%$, ;!""#> and
chneider and Barsoux ;!""#>$ Based on 3ofsteds &or(s, Gray ;1988> proposes
several cultural/ accounting value propositions for countries around the &orld$
imilarly, chneider and Barsoux ;!""#> develop a cultural/ control profile for
different geographical regions of the &orld &ith reference to 3ofstede &or(s$ %
significant number of empirical &or(s ;%s(ary, Ba?difar and %s(arany, !""8= @ang, T$
et al$, !"". and Bor(er, !"1!> have already done on the Grays propositions
&hereas very fe& similar &or(s are done on chneider and Barsoux cultural/ control
profiles$
1
This research study is mainly designed to see &hether the accounting and control
practises in Bangladesh comply &ith the theoretical propositions of Gray ;1988> and
chneider and Barsoux ;!""#>$ The findings to this Cuery &ould ma(e the readers
better informed about the cultural influence on accounting and control practises in
Bangladesh$ Though Grays hypotheses and proposals are more related &ith
financial accounting, it is no& agreed that a proper financial reporting is conducive to
better management accounting and control$ -n addition to this foremost ob,ective,
this study is aimed to serve t&o other purposes$ 9irstly, the researcher &ould li(e to
sho& ho& and &hat management accounting and control techniCuesare used for
control purposes in a transitional economy, Bangladesh$ econdly and finally, the
author &ould li(e to shed light on the same issues of accounting and control in
Bangladesh from some alternative theories$ This probably &ill give the readers an
understanding of ho& other forces or actors other than cultures so far have played
their roles on the development of accounting and control practices in Bangladesh$
This study on Bangladesh has its uniCue significance &hich attracts the researcher$
Bangladesh is said to be a country &ith huge potential as it is mar(ed as one of the
next eleven largest economies of !1
st
century by Goldman achs -nvestment Ban($
This country has a long tradition of culture that has shaped its peoples behaviours
and attitudes over the decades$ But no&, many external factors such as tructural
%d,ustment :rogrammes ;%:> and :overty 4eduction trategy :aper ;:4:>
developed by donor agencies ;Aorld Ban(, -09 etc$>, globali?ation, cross+border
investment etc$ and internal factors ;democracy, media and civil society etc$> are
increasingly pushing the country to brea( its stereotypes of so called traditional
society$ The researcher believes that such transformations onsocietal and
institutional values and practises in any transitional society demand research and
2
this study is a response to this demand$ %part from that, this is probably, the first of
its (ind research on accounting and management control practices in Bangladesh
from culture and other perspectives$ o, it is expected that this study &ould fill up a
gap in the existing accounting and control literatures of transitional economies as
&ell as provide valuable insights to the policy ma(ers, social thin(ers, and
academicians about the driving forces of accounting and control practices in
Bangladesh$
To achieve the purposes of the study, the researcher combines several research
methods in this study$ The triangulations of methods, follo&ed in this study are a
combination of follo&ing issuesD annual report analysis, examination of existing
empirical &or(s on research issues, intervie&s, researchers personal experience
and other archival records li(e ne&spaper reports$ %ll these methods are designed
and directed in such a &ay so that the readers at the end &ill have a clear and rich
understanding on the follo&ing issuesD ho& culture influences the accounting and
control practises in Bangladesh= ho& management accountingand control techniCues
are used in controlling functions of the organi?ations in Bangladesh and ho& other
actors besides cultures are playing their roles in reshaping the accounting and
control pattern in Bangladesh$
The structure of this research paper is divided into six chapters$ /hapter t&o &ould
provide the theoretical frame&or( that &ould be tested in this study$ /hapter three
&ill present a brief historical evolution of accounting and control practises in
Bangladesh$ Then, chapter four &ould discuss the research methods and the
reasons for selecting these methods in obtaining the purposes of the study$ The
prime part of this studyD findings and analysis &ould be presented in chapter five$ -n
fine, the conclusion of the study is presented in chapter six$
3
".!: Theoretical Bac#ground of the $tudy
This part presents the theoretical frame&or(s of this study into three phases$ -n first
phase, propositions of Gray ;1988> about cultural/accounting value hypothetical
area, and chneider and Barsoux ;!""#> cultural/ control profiles are discussed$ -n
second phase, management accounting and control techniCuesin traditional or
transitional countries are described and in finally, several alternative theories are
discussed to explain the accounting and management control practises of a
transitional economy, Bangladesh$ These theoretical compositions build the building
bloc( of this study that &ould be tested from the perspective of Bangladesh$
".: Culture and Accounting
Before moving to Gray ;1988> and chneider and Barsoux ;!""#> propositions, a
brief discussion is made about 3ofstedes cultural dimensions &hich provide basis to
both the authors &or(s$ 3ofstede &or(s have become the dominant paradigm in
cross cultural studies of accounting and management control since its first
publication in 198"$ %ccording to udar&an and 9ogarty ;1992>, 3ofstedes study
&as cited in nearly 2"" studies bet&een 1981and 199! in different disciplinary
studies$ 0any researchers for example,Gray ;1988>, :erera ;1989>, 'oupni( and
alter ;1991> and %s(ary, Ba?difar and %s(arany ;!""8> have explored the role of
3ofstede cultural dimensions in different context of accounting practises= some of
them even tried to theori?e the relationship bet&een culture/accounting values$
3ofstede defines culture as Ethe collective programming of the mind that
distinguishes the members of one group or category of people from othersF
;3ofstede, 3ofstede and 0in(ov, !"1", p$ 2>$ 3ofstede ;198"> identifies four value
dimensionsD -ndividualism versus collectivism, large versus small po&er
4
distance,strong versus &ea( uncertainty avoidance and masculinity versus
femininity$ *ater t&o more dimensions are added, long versus short term orientation
;1991> and indulgence versus restraint ;!"1">$ These dimensions are &ell expressed
in 3ofstede, 3ofstede and 0in(ov ;!"1"> as follo&sD
Indi%idualism %ersus Collecti%ism
3ofstede, 3ofstede and 0in(ov ;!"1", p$ 9!> define this dimension as follo&sD
-ndividualism pertains to societies in &hich the ties bet&een individuals are looseD
everyone is expected to loo( after him+or herself and his or her immediate family$
/ollectivism as its opposite pertains to societies in &hich people from birth on&ard
are integrated into strong, cohesive in+groups, &hich throughout peoples lifetime
continue to protect them in exchange for unCuestioning loyalty$
&arge %ersus $mall Po'er (istance
:o&er 'istance is defined as Ethe extent to &hich the less po&erful members of
institutions and organi?ations &ithin a country expect and accept that po&er is
distributed uneCuallyF ;3ofstede, 3ofstede and 0in(ov, !"1", p$21>$ :eople in 3igh
:o&er 'istance societies accept a hierarchicalorder &ithout further ,ustification
&hereas people in mall :o&er 'istancesocieties strive for po&er eCualisation$
$trong %ersus )ea# *ncertainty A %oidance
3ofstede, 3ofstede, 0in(ov ;!"1", p$ 191> define 7ncertainty %voidance as Ethe
extent to &hich the members of a culture feel threatened by ambiguous or un(no&n
situations$ This feeling is, among other manifestations, expressed through nervous
stress and in a need for predictabilityD a need for &ritten and un&ritten rulesF$
5
trong7ncertainty %voidance cultures maintain fe& la&s or un&ritten rules$ Aea(
7ncertainty %voidance cultures maintain many and precise la&s or un&ritten rules$
+asculinity %ersus Femininity
E% society is called masculine &hen emotional gender roles are clearly distinctD men
are supposed to be assertive, tough, and focused on material success, &hereas
&omen are supposed to be more modest, tender, and concerned &ith the Cuality of
life$ % society is called masculine &hen emotional gender roles overlapD both men
and &omen are supposed to be modest, tender, and concerned &ith the Cuality of
lifeF ;3ofstede, 3ofstede and 0in(ov, !"1", p$ 1.">$
&ong term %ersus short term orientation
This fifth dimension defined by 3ofstede, 3ofstede and 0in(ov ;!"1", p$!#9> as E
long+term orientation stands for the fostering of virtues oriented future re&ards+ in
particular, perseverance and thrift$ -ts opposite pole, short+term orientations, stands
for the fostering of virtues related to the past and present+in particular, respect for
tradition, perseveration of EfaceF, and fulfilling social obligations$
Indulgence %ersus ,estraint
3ofstede, 3ofstede and 0in(ov ;!"1", p$!81> define this dimension as follo&sD
-ndulgence stands for a tendency to allo& relatively free gratification of basic
andnatural human desires related to en,oying life and having fun$ -ts opposite pole,
restraint, reflects a conviction that such gratification needs to be curbed and
regulated by strict social norms$
6
Bangladesh is an %sian country, situated in outh %sia that is scaled across the
national cultural dimensions of 3ofstede$ The table 1 sho&s the 3ofstede scale of
national cultural dimensions in Bangladesh$
Table : -ofstede.s scoring of national cultural dimensions for Bangladesh
Cultural (imensions Inde/ $cores Conte/t %alue
:o&er distance 8" 3igh
-ndividualism !" *o&
0asculinity 11 3igh
7ncertainty %voidance 2" 3igh
*ong term orientation .6 *o&
-ndulgence 5ersus 4estraint !" *o&
ourceD ;3ofstede, 3ofstede and 0in(ov, !"1">
These cultural dimensions describe the impact of a societyGs culture on the values
and beliefs of its members and ho& these values and beliefs shape the behaviour in
society$ Gray ;1988> , on the basis of accounting literature and practises, proposes
some accounting values at the accounting subculture level &hich he thin(s have
close correlation &ith the 3ofstede national cultural dimensions$ These accounting
values are defined by Gray ;1988, p$ 8> as follo&sD
Professionalism %ersus $tatutory Control a preference for the exercise of
individualprofessional ,udgment and the maintenance of professional self+regulation
asopposed to compliance &ith prescriptive legal reCuirements and statutory control$
*niformity %ersus Fle/ibilitya preference for the enforcement of
uniformaccounting practices bet&een companies and for the consistent use of such
practicesover time as opposed to flexibility in accordance &ith the perceived
circumstancesof individual companies$
7
Conser%atism %ersus Optimism a preference for a cautious approach
tomeasurement so as to cope &ith the uncertainty of future events as opposed toa
more optimistic, laisse?+faire, ris(+ta(ing approaches$
$ecrecy %ersus Transparency a preference for confidentiality and the
restrictionof disclosure of information about the business only to those &ho are
closelyinvolved &ith its management and financing as opposed to a more
transparent,open and publicly accountable approach$
Then, based on the relationship bet&een accounting values and national cultural
dimensions, Gray ;1988> develops four hypotheses$ 9irst hypothesis says that high
individualism &ith lo& uncertainty avoidance and po&er distance leads to
professionalism in a society$ -n !
nd
hypothesis, it is said that lo& individualism &ith
high uncertainty avoidance and po&er distance creates uniformity in accounting
practises$ Thirdly, Gray hypothesi?es that high uncertainty avoidance &ith lo&
individualism and masculinity brings conservatism$ The final hypothesis says that
high uncertainty avoidance and po&er distance along &ith lo& individualism and
masculinity result in secrecy$ These hypotheses suggest that of all 3ofstede
nationalcultural dimensions, uncertainty avoidance and individualism have the most
po&erful effect on accounting values$ The others have influence to a lesser extent$
9inally, Gray ;1988> ma(es several hypothetical culture /accounting value area
propositions by combining culture and accounting values$ -n terms of authority and
enforcement of accounting values, Grays propositions areD
Table ": Accounting systems: Authority and 0nforcement$
$tatutory Control
8
*ess 'eveloped
%sian *ess 'eveloped *atin
/olonial %sian
<ear )astern
%frican 8apan
Fle/ibility *niformity
<ordic 0ore 'eveloped
*atin
%nglo Germanic
Professionalism
ourceD ;Gray 1988, p$ 1!>
%rea 1D %sian /olonial ;3ong @ong, ingapore>D the areas &here accounting system
can be characteri?ed under statutory control and flexibility$
%rea !D *ess 'eveloped %sian ;-ndia, :a(istan and Bangladesh etc$>, *ess
'eveloped *atin ;/olumbia, )cuador, 0exico etc$>, %frica and 8apanD the areas
&here accounting system can be characteri?ed under statutory control and
uniformity$ This proposition &ould be tested in this study$
%rea #D %nglo and <ordic countriesD the areas &here accounting system can be
characteri?ed under professionalism and flexibility$
%rea .D Germanic and 0ore 'eveloped *atin countriesD the areas &here accounting
system can be characteri?ed under professionalism and uniformity$
Then on the basis of measurement and disclosure, Grays propositions areD
Table 1: Accounting systems: measurement and disclosure.
9
$ecrecy
Germanic *ess 'eveloped
*ess 'eveloped %sia *atin
%frican <ear )astern
0ore 'eveloped *atin 8apan
Optimism Conser%atism
<ordic %sian
%nglo/olonial
Transparency
ourceD ;Gray 1988, p$1#>
%rea 1D %nglo, <ordic and %sian /olonial countriesD the areas &here accounting
disclosures have transparency and accounting measurement have optimistic values$
%rea !D *ess 'eveloped %sian, *ess 'eveloped *atin, Germanic, %frica and 8apanD
the areas &here accounting disclosures and measurement can be characteri?ed by
secrecy and conservatism$ This proposition &ould be tested in this study$
".":Culture and +anagement Control
10
0anagement control systems deal &ith people and it is, therefore, very li(ely to be
affected by national culture ;Htley, 1968= 3ofstede, 198" 'aley et al, 1981>$
/ontextual factors have a great influence in the design and application of
management control system ;/henhall, !""2>$ 3ofstedes &or(s dra& huge attention
in international management as it first broadly and structurally ta(es into account the
importance of national cultural differences$ Though they are critici?ed on several
different bac(grounds, many researchers highly praise 3ofstede &or(s$ 3arrison and
0c@innon ;1999> say that the adoption of 3ofstedes frame&or( in explaining the
influence of national culture on management control and information systems
complies &ith most of the previous studies on management control$
0anagement control system focuses on multiple control systems &or(ing together
;Aidener, !""6>$ -t may be formal or informal, but imon ;1991> argues that it
should be formal and information based$ %ccording to imon ;1991>, management
control system ;0/> consists of four interrelated control systemsD beliefs system
;vision statement, mission statement etc$>, boundary system ;code of conduct,
strategic constraints etc$>, diagnostic control system ;Budgets, Balance corecard
etc$> and interactive control system ;monitoring (ey uncertainties>$/onstant
interaction among these four control systems are necessary for better company
performance$ 0/ is considered as sand&ich bet&een strategic planning and
operational control ;Htley, Broadbent I Berry, 1991>$
3ofstedes cultural dimensions have profound impact on the behaviour pattern of
human being in a particular society$ )ach of the dimensions affectscontrol
systemgreatly, but individualism versus collectivism and masculinity versus femininity
have relatively little influence on the control and planning system$ %ccording to
3ofstede ;!""1, p$ #81>, t&o dimensionsD po&er distance and uncertainty avoidance
11
have significant influence over control and planning$ :o&er distance influences
control mechanism highly &hereas uncertainty avoidance has more influence on
planning$
'epending on these t&o dimensions, chneider and Barsoux ;!""#> build 3ofstede
emerging control profiles$ The profiles divide the &orld into four regions and point out
that %nglo countries ;7@, 7% and /anada> and <ordic countries ;<or&ay, &eden
etc$> &here both po&er distance and uncertainty avoidance are lo&, decision ma(ing
process is decentrali?ed and main mode of control is result or output control$
/onversely, &here both po&er distance and uncertainty avoidance are high
especially *atin %merican countries ;Bra?il, 0exico,%rgentina etc$> , decision ma(ing
is centrali?ed and input control is the main focus of control$ %sian countries &here
uncertainty avoidance is lo& but po&er distance is high, social or paternalistic control
are used &ith high level of loyalty to the leadership$ -n Germanic society,
coordination is achieved through rules and regulation and the span of control is
usually narro&$
%ccording to the profiles, control practices in Bangladesh, as it is situated in %sian
region, are centrally managed along &ith emphasis on personal loyalty, relationship
and social control that &ould be examined in this study by existing empirical &or(s$ %
tabular presentation of the chneider and Barsoux profiles is given belo&D
Table 2: -ofstede.s emerging cultural profiles
12
*o& 3illage +ar#etFamily or Tribe
7ncertainty;%nglo/<ordic>;%sian>
%voidance 'ecentrali?ed /entrali?ed decision ma(ing
:eople as free agents *oyalty
0ore delegation :aternalistic control
)ntrepreneurial trong social vs$ tas( role
9lexibility, -nformal coordination :ersonal relationship
Generalist and output control ocial control
9ormali?ation )ell Oiled +achine Traditional Bureaucracy
;Germanic>;*atin>
'ecentrali?ed 'ecision ma(ing /entrali?ed decision ma(ing
<arro& span of control /oordination at the top
ocialist, technical competence trong role of staff
'iscretion limited by expertise J/loisonnK highly speciali?ed
trong role of staff Jexperts trong role of staff
Top management team %nalytic ability
-ndustry and company (no&ledge :yramid of people
Hrgani?ation by function -nformal relationship
/oordination through rules Jystem '
/ompartmentali?ed ;chimneys> )litist ;po&er and authority>
tructural solution *ess delegation
Throughput control and efficiency -nput control
*o& 3ierarchy 3igh :o&er
;ourceD chneider and Barsoux, !"1#> 'istance
".1: +anagement Accounting and Control in Traditional society
13
0anagement control is an information based system reCuires input from accounting,
especially from management accounting to deal &ith the extensive measurement
throughout the system$ These t&o &ords, management accounting and management
control are sometimes used interchangeably ;/henhall, !""#>$ %ccording to %nthony
and Boung ;1999>, management accounting has three ma,or componentsDfull cost
accounting, differential accounting and management control or responsibility
accounting$ The ideas of management accounting concepts &ere developed first in
advanced economies, but gradually the influence of them reached to the less
developed and transitional economies$ -nitially, it is thought that management
accounting and control practices are li(ely to converge across nations, especially in
firms that operate internationally ;e$g$, Granlund and *u((a, 1998= hields, 1998>$But
researches ;9irth 1992; 3ol?er and <orre(lit, 1991>sho& that there still exist
considerable differences in management accounting and control techniCues of
multinational corporations bet&een their operations in developed and developing
economies$
/-0% ;!""1, p$5> defines management accounting as Ethe application of the
principles of accounting and financial management to create, protect, preserve and
increase value for the sta(eholders of for+profit and not+for+profit enterprises in the
public and private sectorsF$ The role of management accounting ranges from
performance evaluation ;3op&ood, 196!> to cost/financial control ;Granlund and
*u((a 1998> to controlling strategy ;imons, 1991>$
The relationship bet&een management accounting and control may differ from
country to country$ %ccording to Bhimani ;1992>, management accounting practises
in a particular society are idiosyncratic and can be mar(ed by its uniCue culture ;e$g$
beliefs, values, history, legal system etc$>$ 3ol?er and <orre(ilt ;1991> develop a
14
theoretical comparative study of organi?ational practises bet&een traditional
manufacturing society and advanced manufacturing society$ They assert that in
terms of planning and control functions, a traditional manufacturing concern has the
follo&ing concernsD constant demand fluctuation, freCuent rescheduling, many
engineering changes, &ee(ly planning, long lead times, large lot si?es, vendor
difficulties &hereas the same firm in advanced manufacturing context &ould face
demand stabili?ation, minimum rescheduling and ?ero change, hourly planning and
vendor synergies$ -n case of financial control, they say that firms in traditional
manufacturing countries &ould focus on labour efficiency, shop orientation= focus on
variable cost and cost management, but firms in advance manufacturing contexts
&ould loo( for product profitability, minimum variable cost, ?ero labour cost and
Cuality improvement$ They also point out that organi?ational structure is hierarchical
and functional interfaces exist in traditional manufacturing societies &hereas in
advanced manufacturing societies, fe&er hierarchical levels exist, but more
functional teams operate$
o, the contextual varieties may lead to the difference in using management
accounting techniCues across the globe$ This study &ill also provide a picture of ho&
and &hat management accounting and control techniCues are used for controlling
purposes in a traditional and transitional society, Bangladesh, through existing
empirical &or(s$
15
".2: Alternati%e Theories
Though 3ofstedes research is highly used by many accounting researchers, it has
received severe criticism from several scholars li(e= Bhimani;1999>= 0c&eeney
;!""!> and Bas(erville ;!""#>$ Bhimani ;1999> says that 3ofstedes study is based
on only some &ell+(no&n cultural settings &hereas 0c&eeney ;!""!> opines that
-B0 cannot be the representative model for the &hole &orld$ Bas(erville ;!""#>
points that 3ofstedes model cannot grasp the richness and specificities of culture=
rather it is a self+predictive and self+referencing model$ The use of Cuestionnaire is
not appropriate to understand culture that may ultimately give a &rong assessment
of the culture$ They all sho& the theoretical, methodological and findings &ea(ness
of the 3ofstedes &or($ 0oreover, in reality, many other forces besides cultures have
brought changes to &or(ing values and practises around the &orld &hich are not
considered in 3ofstedes researches$ o, the researcher hopes that application of
some alternative perspectives in explaining the research issues &ould bring
additional ,udgments to this study$
/onsidering the influence of colonial legacy, ma,or eco+political events, legal+
economic conditions and globali?ation on Bangladesh, this study &ould explore three
other sociological theories such as ne& institutional theory, structuration theory of
Giddens, and theories of political economy for less developed economies ;3opper, et
al$, !""9> in explaining the accounting and control practices of Bangladesh$ %ll these
three theories have the potential to enrich the findings of this study as they discuss
about various ingredients that influence societal and institutional practises of a
developing country$
16
<e& institutional theory asserts that every institution is influenced by its institutional
peer pressure$ o, for survival, each institution has to do more than economic
supremacy to legitimi?e the institution$ upporters of this theory believe that
organi?ations ,ust mimic the systems and practices of similar and related established
organi?ations to gain external legitimacy$ Though external factors are considered
highly in the explanation of this theory ;'acin, Goodstein and cott, !""!=
Green&ood et al$, !""!>, a ne& trend has been empathi?ed to ta(e into account the
internal organi?ational dynamics also ;cott, !"".>$ %s Bangladesh economy is
expanding and getting more connectivity &ith the global economic community, it is
beneficial to study the influence of different institutional pressures on the practices of
Bangladeshi firms and organi?ations$
The second theory considered here is the Jtructuration theory$ This theory is better
(no&n for diagnosing the underlying socio+political structures that dominate the
rational decision ma(ing process of firms in the developing economies contexts
;*arbi, !""1>$ %ccording to this theory, po&er is domination, achieved from control
over resources$ There are t&o types of resourcesD allocative and authoritative$
%llocative resources are visible and material, on contrary= authoritative resources are
non+material but can be perceived by others$ The control over any of these t&o
resources can ma(e an individual able to dominate others$ tructuration theory has
been used by 0acintosh and capens ;199"> and 4oberts and capens ;1981> to
investigate the influence of po&er over management control$ -t is argued that
management control system of an organi?ation &ould &or( as domination
arrangement as it &ould eCuip managers &ith resources so that they could influence
the po&er distribution system;0acintosh and capens, 199">$ -n asociety li(e
Bangladesh &here high po&er distance exists, it is really helpful to use the
17
Jtructuration theory of Giddens to see ho& the po&er is achieved and exercised in
controlling the people$
9inally, the political economy theory for less developed economy ;3opper, Tsamenyi,
7ddin, and Aic(ramasinghe, !""9> &ould be used to explain the accounting and
control practises of Bangladesh$ This theory is highly influenced by political histories
of less developed countries, colonialism as &ell as theory of Jfactory regimes$ 9ive
historical political regimesD colonial despotism, state capitalism, political factionalism,
mar(et capitalism, and politicised capitalism are identified in this theory that exhibit
the different control pattern in those less developed economies through the passage
of time$ These five regimes are also tagged as either ideal regime or actual regime$
-n ideal mar(et capitalism, this theory states that control systems are better
presented by mar(et based controls including application of contemporary &estern
best practice, economic performance measurement and external reporting for capital
mar(et$ %lternatively, in a politici?ed mar(et capitalism, control systems can be
characteri?ed by private accounts, top+do&n physical budgets, return of coercive
control but no physical violence, &ea( compliance of external regulations, toothless
trade unions &ith lo& bargaining po&er$
".4: $ummary:This chapterpresents a compilation of theories that &ould be tested
or used in explaining the accounting and control practises of Bangladesh$ %ll the
chosen theories have already used by many researchers in explaining socio+
intuitional practices of different societies$ The next chapter &ill provide a brief history
of accounting and control practises in Bangladesh$
18
1.!: -istorical Bac#ground of Accounting and Control in Bangladesh:This part
presents a brief history of Bangladesh from the perspective of accounting and
control$Bangladesh is an independent country, situated in outh %sia &hich got its
independence on 0arch !2, 1961$ -t had a long history of 0uslim and British rule
before its independence from :a(istan$ %ll those preceding ruling countries have
had profound influence on the practises of various socio+eco+political institutions of
Bangladesh, but undoubtedly it can be said that the British system have had the
most important one$ The country came under the direct British control in 1616 %'
and remained till 19.6$ Hf all disciplines of (no&ledge, British influence is mostly
visible on the accounting education of Bangladesh$
1.: -istory of Accounting in BangladeshD The accounting profession in
Bangladesh is mainly controlled by t&o bodiesD The -nstitute of /hartered
%ccountants of Bangladesh ;-/%B> and The -nstitute of /ost and 0anagement
%ccountants of Bangladesh ;-/0%B>$ The formations and &or(ings of these t&o
institutions are very much similar to the model of 7nited @ingdom ;7@> ystem
;:arry and Grooves, 199">$ 'espite the existence of t&o bodies, the -/%B is claimed
as the sole authority of adopting accounting standards in Bangladesh$ The mission
of this institution ;-/%B> is Eto provide leadership in the development, enhancement
and coordination of the accountancy profession in Bangladesh in order to enable the
profession to provide services of consistently high Cuality in the public interestF
;-/%B, !"1!>$ This institution has alliance &ith several global institutions li(e
-nternational 9ederation of %ccountants ;-9%/>, /onfederation of %sian I :acific
%ccountants ;/%:%> and -nstitute of /hartered %ccountants of )ngland and Aales
;-/%)A>$
19
The -/%B &as established in 196# under the Bangladesh /hartered %ccountants
Hrder 196# ;:residential Hrder <o$ ! of 196#>$ Before that, %ccounting &as
practised under the directives of -nstitute of /hartered %ccountants of :a(istan
;-/%:> in Bangladesh &hich &as called )ast :a(istan then$ Aith an initial 68
members only, the institute started its operation in 196!$ 'uring 196"s, Bangladesh
economy &as not commercially developed, rather ne& government after
independence adopted socialist approach to&ard economic system$ 0ost of the
private commercial institutions &ere nationali?ed and stoc( mar(et became
ineffective$ :ublic accounting practises &ere (ept by the Bangladesh
;<ationali?ation> Hrder 196!$ -t &as basically in 198! &hen the private sectors
started to get boom and the economy and stoc( mar(et began moving for&ard$-n
1986, )/ of Bangladesh issued a directive for all listed companies to prepare their
financial statements in accordance &ith the reCuirements set in the chedule and the
-%s adopted by the -nstitute of /hartered %ccountants of Bangladesh$
By the year 1992, t&o stoc( exchanges &ere established and the /ompany la&
199. &as enacted in Bangladesh$ o, for better stoc( mar(et operations and public
expenditures, the need for appropriate financial reporting &as emphasi?ed both by
the various governmental regulatory bodies and international donor agencies$ -n this
connection, the Aorld Ban( in 1999 made a donation to the Bangladesh government
for the development of accounting and auditing standards$ The government then
delegated the function to the ecurities and )xchange /ommission ;)/> of
Bangladesh$ ubseCuently, )/ empo&ered -/%B to adopt -nternational %ccounting
tandards ;-%s> in Bangladesh$
/ompliance &ith adopted accounted standards is not mandatory in Bangladesh by
/ompany %ct 199.$But, from !""1, )/ of Bangladesh made it obligatory for all
20
listed firms to comply &ith adopted standards of -/%B$-n addition, listed ban(s and
other non+ban(ing financial institutions must have to comply &ith B4:' circulars,
Ban( /ompany %ct 1991 in preparing their financial statements$ -/%B, in case of
adopting a ne& standard, follo&sa rigid process of technical revie&$ %fter adopting a
standard, the -/%B labels it as either B%s or B94s$ o far ;as on 1
st
8anuary,
!"1#>, the -/%B has adopted !9 -%s and 1! -94s in Bangladesh$
The other accounting professional institution named The -nstitute of /ost and
0anagement %ccountants of Bangladesh ;-/0%B>, has long cherished to be part of
the accounting and auditing standard setting body of Bangladesh$ -n 1999, the
ministry of commerce, Bangladesh issued a memorandum proposing establishment
of a committee named J%ccounting and %uditing tandards 0onitoring Board &ith
the participation of all interested parties ;-/0%B, 1999>$ The -/%B re,ected this
notion, but the proposal is still under consideration$ The -/0%B has been actively
lobbying &ith various national and international institutions for the establishment of
the board$ The -/0%B &as established in 1966 &ith only .! members$ %s on 18
th
%pril, !"1#, the membership gro&s to 1"8"$ The mission of this institution is to
develop, eCuip and promote cost and management accounting profession by
maintaining highest professional standard of its members in order to enable them to
provide better services to the society ;-/0%B, !""6, p$ !>$
21
1.": -istory of +anagement control in Bangladesh:0anagement control concept
in its &estern version is relatively very ne& idea in Bangladesh$ The history of
industriali?ation in Bengal is not old, rather it is better (no&n as agrarian society for
centuries to the outer &orld$ -n fact, from British colonial period, some sort of formal
management control practises have been observed in this part of the &orld$
0ohiuddin ;!"1!> asserts that labour management in Bangladesh can be traced
bac( to the period ;19!9+19#1> or JAhitley /ommission 4eport &hen labour officers
&ere reCuestedto appoint for settling the grievances of the &or(ers$ They &ere also
assigned to recruit personnel to chec( corruption in -ndian industries by excluding
the ,obber from engagement$ -n 19#9, five labour officers &ere appointed to solve
the 0ill problems locally$ This is probably the first recorded history of formal
management control practices in the history of Bengal$
Then during the regime of :a(istan, several big industrial pro,ects &ere set up in
Bangladesh &hich &as (no&n as )ast :a(istan at that time$ *abour unrest started to
gro& in various large mills across the united :a(istan$ Hn reCuest of :a(istan
government, -*H in 191! co+assisted the government in conducting a survey on the
labour problem issues of :a(istan$ -n conseCuence, :a(istan -nstitute of
0anagement &as established in 191. in order to develop Cuality management in
factories and government offices$ % branch of this institution named Bangladesh
0anagement 'evelopment /entre &as set up in 1921 in 'ha(a, Bangladesh$ The
9actory %ct+19#. &as replaced &ith the 9actories %ct 1921 &hich had the provision
of appointing employee &elfare officers if an industry has more than 1"" &or(ers$
%s private investment to a small scale began during 192"s in Bangladesh, necessity
of an independent professional body &as felt$ %s a result, Bangladesh institute of
0anagement ;B-0> &as established in 196" ,ust before the independence
22
ofBangladesh from :a(istan$ 'uring the first fe& years of independence &hen all
business organi?ations &ere nationali?ed, B-0 played a pivotal role in developing
public management human resources$ B-0, from its beginning to till date, has been
conducting several post graduate diploma courses li(e :ost Graduate 'iploma in
3uman 4esource 0anagement ;:G'340, :ost Graduate 'iploma in Business
0anagement ;:G'B0> and :ost Graduate 'iploma in 9inancial 0anagement
;:G'90> etc$
'uring the 9"s of the last century, 0ulti+national /orporation introduced modern
control techniCues for the first time in Bangladesh$ Gradually, many local firms also
reali?ed the importance of better management concepts and started to use them$
<o&adays, almost all public and private universities of Bangladesh conduct various
academic programmes on management and human resource development issues$
0oreover, !
nd
generation entrepreneurs studied in developed countries are also
trying to implement latest management concepts in many firms and organi?ations of
Bangladesh$
1.1: $ummary:This chapter summari?es the historical development of accounting
and control practises in Bangladesh$ %ll ma,or events and issues that have brought
the current form of accounting and control practises in Bangladesh are discussed
here$ The next chapter &ill present details of the research methods that &ould be
applied in this study$
23
2.!: ,esearch +ethods and design
2.:Introduction:This is an exploratory study conducted over the issue of
accounting and management control practises in Bangladesh$ -n this chapter, the
methods that are follo&ed to do the study are discussed$ This study explored several
relevant sources of information that can be called methodological triangulation in
order to provide a broad, strong and less biased conclusion on the research topic$
Triangulation means cross verification of data for increasing validity by incorporating
several vie&points and methods ;Beasmin and 4ahaman, !"1!>$
2.": ,esearch +ethods:Theoretically, it can be said that out of different types of
triangulation, this study is a combination of data and methodological triangulation$
Thurmond ;!""1> describes the benefits of triangulated research as follo&sD
developing confidence &ith research data, innovating ne& means of understanding a
phenomenon, bringing uniCue findings to the problems, challenging or
accommodating theories, and catering a clearer understanding of the problem$ This
research study aims to cover t&o broad areasD accounting, and control practises in
Bangladesh$ o, the researcher plans to use the triangulations follo&ed in this study
differently on these t&o areas$ ources of information li(e annual report analysis,
existing empirical &or(s on accounting issues of Bangladesh and ne&spaper reports
&ill be used in case of validating the theories on accounting practises in Bangladesh
&hereas existing empirical &or(s on control issues of Bangladesh, evidence of
intervie&s, personal experiences and ne&spaper reports &ill be used for validating
the theories on control practises in Bangladesh$
24
2.1: Analysis of Annual ,eportsD To test the theoretical propositions of Grays
about the accounting practises in less developed %sian countries li(e Bangladesh, a
study on the annual reports of #" listed companies of 'ha(a toc( )xchange *td$,
Bangladesh is conducted over the periods !"1"+!"1!$ 'ha(a toc( )xchange *td$ is
chosen because it is the first stoc( exchange and it has the highest mar(et
capitali?ation and number of listed companies in Bangladesh$ The annual reports
are collected from the database of -nternational *easing /ompany ecurities *td$ %n
email is sent to the authority of this organi?ation and they happily agreed to provide
#" non+financial companies annual reports ;%ppendix 3> for the given period$ The
researcher consciously avoids including any financial companys annual report in
data set for ensuring data homogeneity$ Time and other constraints also lead to limit
the study over #" listed companies for # years$ Total 9" annual reports are collected
for analysis$ %ll the companies chosen for the annual report analysis are a mixture of
domestic and subsidiaries of multinational companies$ %nnual reports are not only
the prime source of information regarding the companies disclosure and
measurement of financial events and transactions, but also a record of analysing
reporting consistency over the periods$ -n addition to the annual reports, information
about the standard setting process and professional bodies of Bangladesh is
collected from other sources$
%s Grays culture/accounting value propositions depend on four factorsD authority
;tatutory control or professionalism>, measurement ;conservatism or optimism>,
disclosures ;transparency or secrecy> and consistency ;uniformity or flexibility>, the
remaining part of this section is divided into four subsections$ )ach subsection deals
&ith the variables of each of those four factors that &ould be tested against annual
reports and other related information$
25
2.1.: Authority 3ariables: %ccounting authority concern &ith the standard
setting process of accounting principles and policies$ -n this study, accounting
authority in Bangladeshis tried to measure through seven dummy variables &ith yes
or no ans&er ta(en from the &or(s of %s(arys ;!""1, !""2>$ -f any variable responds
&ithJyes, then the value given is 1= other&ise "$ -f all the variables have Jyes ans&er,
then it can be inferred that accounting authority is in the professionals hands$ %ny
value in bet&een o and 1 dictates accounting authority lie some&here bet&een
statutory control and professionalism$ The variables are as follo&sD
Table 4: The 3ariables to scale accounting authority
No. (efinitions of the %ariables
1 'o accounting and professional auditing bodies exist in the countryL
! %re the bodies involved in developing national accounting and auditing
standardsL
# -f not, are annual reports based on -nternational %ccounting tandardsL
. hould the annual reports be accompanied &ith the auditors reportL
1 %re the professional accounting and auditing bodies independent of their
governmentsL
2 %ccounting and auditing regulations are not controlled or developed
predominantly bythe tate$
6 The base of financial statements preparations is not restricted to the
statutory businessla&s$
ourceD %s(ary ;!""2, p$1"6>
2.1.": (isclosure 3ariables: 'isclosures of financial information not only
enhance firms acceptance to the public but also drive the capital mar(et mobility$
7sing the same dummy variables approach, seven items are developed by the
26
researcher to measure the disclosure position of Bangladeshi listed companies$ 9or
each of the variable mentioned belo&, if disclosed in the financial statements, then
the value J1 &ould be assigned = other&ise "$ The disclosure items for variables !, #,
., 1 and 2 are set as 1", .", 1., !" and !" respectively ;appendices %, B, /, ' and
)>$ The numbers and items are set by the researcher on the basis of adopted -%s
and -94s as there are no disclosure chec(lists for listed companies in Bangladesh$
-f a company discloses an item reCuired for variables ! to 2, it &ould be given value
J1= other&ise Jo$ ubseCuently a &eighted average value &ould be calculated for
every company against each of the variables from ! to 2$ Then, an average value
&ould be calculated for each of these five variables by averaging the values #"
individual firms$
Table 5: The %ariables to scale accounting disclosures
No (efinition of the %ariables
1 9irms &illingness to be transparent to the people$
! 'isclosures of general information about entity$
# 'isclosures reCuired for Balance sheet$
. 'isclosures reCuired for :rofit and *oss tatement$
1 'isclosures reCuired for /ash flo& statement$
2 'isclosures reCuired for accounting policies$
6 'isclosures of notes to financial statements
2.1.1: Consistency or *niformity 3ariablesD /onsistency in accounting records
increases the comparability of accounting information$ To measure the uniformity of
accounting practises, %s(ary ;!""1> developed seven variables on the basis of Gray
;1988> &or( in respect of accounting enforcement$ -f any variable mentioned belo&,
respond &ith Jyes ans&er, then value 1 &ould be given , other&ise "$ % strong
consistency &ould be seen in financial reporting if all variables respond &ith Jyes
ans&er$ Hther&ise, some sorts of flexibility &ould rest in financial reporting system$
27
Table 6: Accounting *niformity 3ariables
No (efinition of the %ariables
1 <o accounting changes &ithin the firms during !"1"+!"1!$
! 7niformity in using accounting policies across firms
# <ot using other statements instead of /ash 9lo& tatement ;/9>$
. 7niformity in presenting Balance heet items
1 7niformity in presenting -ncome tatement items
2 7niformity in presenting /9
6 7niformity in presenting notes to the financial information
ourceD ;%s(ary !""1 cited in %s(ary, Ba?difar and %s(arany, !""8, p$81>
2.1.2: +easurement %ariables: Traditional historical accounting is a symbol of
conservatism &hereas fair value is treated as a matter of optimism$ ame li(e the
previous one, %s(ary ;!""1> developed seven dummy variables that can be used to
ran( accounting measurement from conservative to an optimism alternative$ The
value J1 is assigned to the conservative measurement &hereas the value
J"associates &ith non+conservative measurement$ The follo&ing table is the list of
seven variablesD
Table 7: 3ariables for scaling accounting measurement
No (efinition of the %ariables
1 3istorical cost accounting used for the measurement of assets$
! *o&er of cost or net realisable for inventories$
# 0easuring fixed assets or property, plant and eCuipment at cost less
depreciation
. 4eceivables, net of provision for doubtful debts$
1 /onditional or contingent loss disclosed in -ncome tatements$
2 Hther reserves in addition to general and statutory reserves$
6 -ntangible at net of amortisation$
ourceD ;%s(ary !""1 cited in %s(ary, Ba?difar and %s(arany, !""8, p$8!>
28
%ll the variables developed and designed by %s(ary, $ ;!""1, !""2> have already
used to analy?e annual reports in an empirical &or( examining the Grays
cultural/accounting value propositions in Tur(ey$ The researcher believes that
ans&ers to these variables &ill similarly help in determining the relevance of Grays
culture/accounting value propositions in Bangladesh$
2.2: Analysis of 8ournal and Articles: )mpirical and/or theoreticalstudies on the
issues ofaccounting and management control practises in Bangladesh are very
limited$ To get as most as possible number of articles and / or empirical &or(s on the
studied issues, t&o approaches are follo&ed$ Hne is to examine the several ma,or
,ournals of BangladeshD 8ournal of Business tudies, 7niversity of 'ha(a= The
costand 0anagement, The -nstitute of /ost and 0anagement %ccountants of
Bangladesh= and The Bangladesh %ccountant, The -nstitute of /hartered
%ccountants of Bangladesh$ These ,ournals are easily accessible and the leading
providers of empirical &or(s on accounting and control issues in Bangladesh$
%nother approach is to search the &or(s of the authors &ho have done substantial
&or(s on accounting and control issues of Bangladesh$ The ,ournals of 7niversity of
Birmingham ;7@> library including its e+library platform are searched$ 0any other
articles are also considered relevant to the study from the Google online search$ %n
important theoretical part of this study is ta(en from the 3ofstede ;!"1"> E/ultures
and Hrgani?ationsD soft&are of the mindD intercultural operation and its importance
for survivalF &hich is available in the 7niversity of Birmingham library$ %ll the
empirical &or(s related to accounting and control practises in Bangladesh, collected
for this study provide the strongest inputs in supporting/refuting the theories
considered for this study$
29
2.4: Inter%ie's: Thirdly, several telephone intervie&s are conducted &ith
experienced personalities of the Bangladesh in the field of accounting, control and
auditing$ huy ;!""#> points out the advantages of telephone intervie&s as follo&sD
reduced intervie&er effects, better intervie&er uniformity in delivery, researcher
safety, greater cost efficiency and fast results$ 9irstly, an intervie& is conducted &ith
the ex+ president ;!""6+!""8 and !"1"+!"11> of The -nstitute of /ost and
0anagement %ccountants of Bangladesh ;-/0%B> over telephone ;appendix 9>$ The
intervie& is of semi+structured type and its contents are designed giving focus on
management accounting and control issues of Bangladesh$ Theintervie&ee narrates
his personal experiences, observations and opinions on the issues$ %nother
intervie& is conducted &ith one of the director of <79% audit firm of Bangladesh on
the accounting, auditing and control issues of Bangladesh ;appendix G>$ The director
shares his experiences and opinion on the issues$ Hverall, the evidence of
intervie&s provides additional insights in explaining the issues of this study$
0oreover, the researcher o&n experience as an intern in the accounts department of
a private Bangladeshi company helps to loo(, feel and analy?e the issues &ith
confidence$
2.5: &imitations of the ,esearch +ethodsD Though it can be said that triangulation
is the most po&erful method that cross verified data through different sources of
information, but it is not &ithout limitations$ Besides time consuming, several other
limitations associate &ith it &hich are depicted by Thurmond ;!""1> as probable
friction and conflict due to investigator biases and theoretical frame&or(s, and lac( of
clear comprehension about &hy triangulation strategies are used$ *imited data sets
are the most important limitation of this study$
30
2.5: $ummary:This chapter discussed the various sources of information used in
this study$ The researcher strives to complete the study by available empirical &or(s,
intervie&s and personal experiences along &ith data from #" non+financial
companies annual reports over !"1"+!"1! periods$ The limitations and
disadvantages surrounding &ith these methods are also discussed$ The next chapter
&ill provide details of findings from different sources of information &ith necessary
analysis$
4.!: Findings and AnalysisD Gray ;1988> proposes that accounting practices in less
developed %sian countries li(e Bangladesh &ould be uniform and state controlled
&ith secrecy and conservatism in their applications$ o, to chec( the relevance of
Grays proposition, seven variables are designed and tested for each of the
accounting value dimensions$ The ans&ers to these accounting value variables &ill
sho& the influence of national culture on accounting practices of Bangladesh$
4.: 9ray.s Culture:Accounting 3alue Proposition and BangladeshD The all
actual averages of the seven variables applicable to each of the accounting value
dimension are as follo&sD
Table 7: Actual measures of the %ariables related to accounting practises
%ccounting 5alues 1 ! # . 1 2 6 %verage
%uthority 1 1 1 1 1 1 " $816.
'isclosure $## $22 $12 $2! $6" $61 $8.$2#81
31
7niformity $6! $6" 1 $8. $88 $9! $8. $8.!8
0easurement $12 $88 $6 "$22 " $2! $.. $1#.!
4..:Accounting Authority and Bangladesh: The average score of the accounting
authority variables is 81$6.M in Bangladesh$ Hf all seven accounting authority
variables, first five variables are related &ith the professionalism &hereas last t&o
variables tal( about the state control over accounting practises$ The ans&er to the
first variable is Jyes as t&o professional accounting bodies exist in Bangladesh$
imilarly, the ans&er of variables ! to 1 are Jyes because -/%B, an independent
professional body, plays a ma,or role adopting of -%s in Bangladesh and annual
report of every listed company must accompany report from independent auditors$
The ans&er tovariable 2 is Jyes, but Jno to variable 6 because govt$ of Bangladesh
dont interfere in accounting standard setting process though the bases of financial
reporting are restricted to business la&s in Bangladesh$ The average score of
authority variables says that accounting authority in Bangladesh is visibly in the
hands of professionals &hich ultimately re,ect the Grays proposition of state control
in Bangladesh$ T&o other empirical &or(s can be used to cross verify the findings$
%s(ary ;!""2> comments that Grays hypothesis of accounting authority is fully
confirmed for -ran, and moderately by Hman, 8ordan, Bangladesh, and Natar, it is
totally re,ected forTur(ey, :a(istan, 0alaysia, and -ndonesia$ Bhattachar,ee and
-slam ;!""9> point out that -/%B is assigned to adopt Bangladesh %ccounting
tandards ;B%s>$ The ecurities and )xchange /ommission ;)/> of Bangladesh
reCuires every listed company to prepare financial statements according to the
reCuirements laid do&n in the 4egulation and the standards adopted by the -/%B$
32
4..": Accounting (isclosures and Bangladesh: This is probably one of the most
researched issues on the financial reporting practises of Bangladesh$ The results
from table 8 sho& that Bangladesh is on the middle of the continuum in terms of
accounting disclosures as it scores 2#$81M$ 5ariable 1 spea(s about the firms
&illingness to be open to the public in Bangladesh$ %s it is a very sub,ective issue
and does not have any reliable source or past study to measure it, the researcher
uses the vast experience of the auditor &ho is intervie&ed for this study to scale it$
3e informs the researcher that at best one+third of all listed companies in 'ha(a
toc( )xchange *td$ can be distinguished as &illing to open themselves to the
public$ o, the researcher put the value of $## or ##M to variable 1$ 9or variables !
to 2, every sample company is mar(et against the lists of disclosure items that are
sho&n in appendices$ Then, an average value is calculated by averaging the scores
of #" companies for each variable and sho&n on the table 8$ 9or variable 6, every
single annual report is chec(ed and mar(ed, and then an average value is
calculated$ The findings suggest that Grays assumption about the secrecy of
accounting practises in Bangladesh is moderately acceptable$ everal academicians
have &or(ed on this issue and their findings may be useful to cross verify the
findings$%hmed and <icholls ;199.> say that the degree of compliance in
Bangladesh &as lo&, since none of the sampled companies complied &ith statutes
by disclosing all mandatory information$ %nother study is conducted on the
disclosure practises of non+financial listed companies of Bangladesh by 3asan,
3ossain and &ieringa ;!"1#>= and they report that the amount of disclosures is
gradually increasing in Bangladesh, but it is still not up to the mar($ 0oreover, the
financial disclosureslac( reliability that ma(es the users not to use the information in
investment decision$
33
)/ of Bangladesh &ith support from Aorld Ban( and -09 is trying hard to ensure
transparency in corporate reporting of listed firms$ 0any improved rules and
regulations have already implemented that starts benefitting no&$
Figure : +easurement of accounting disclosure %ariables in Bangladesh
4..1: Accounting *niformity and Bangladesh:The statistics of table 8 sho& that
Bangladeshi firms maintain a strong preference to&ard uniformity and consistency of
accounting applications over the period !"1"+!"1!$ -nterestingly, variable #, out of all
uniformity variables, gains the 1""M level of compliance by all the sample firms$
The reason for this is that the /ompany %ct 199. in Bangladesh specifically
mentions that every listed company must include the cash flo& statement prepared
by direct method in its annual report$ Hn the other hand, variable ! holds the least
scores that indicates that financial statements across firms of Bangladesh vary
substantially in the application of accounting policies and presentation of items$ But,
a high level of consistency is seen in the preparation of financial statements
;Balance sheet, :rofit and *oss tatement and /ash 9lo& tatement> &ithin the firm
over the years$ The researcher as(ed the director of audit firm intervie&ed for this
study for the possible explanation of this trend$ 3e replies that same audit firms do
the audit for a particular listed company over a long period of time &hich is probably
34
the main reason behind this$ The findings support Grays assumption about the
uniform accounting practises in less developed %sian countries li(e Bangladesh$
)mpirical &or(s from other scholars also support the findings$Bhattachar,ee and
-slam ;!""9> do a study on the applicability of -94 in Bangladesh and suggest that
adoption of -94 could reduce accounting diversity in Bangladesh$ 9ortunately, for
the past five years, 9 -94s are adopted in Bangladesh$ %hmed and 3ossain ;!"11>
say that the flo& of accounting policy change is volatile among the listed companies
of Bangladesh$ They report that only !1$2!M of the sample companies reported
three+year accounting changes over the period !"""+!""8$
Figure ": The limit of accounting uniformity %ariables in Bangladesh
4..2: Accounting +easurement and Bangladesh: Bangladesh is historically
(no&n as a conservative society$ The results of table 8 sho& that Grays assumption
about accounting conservatism in Bangladesh is valid$ The adoption of -94s/-%s
partially changes accounting practices of Bangladeshi firms$ Hne decade before
almost all companies ,ust use historical cost convention, but no& the B94 1#
35
allo&s fair value in measurement of some assets and liabilities$ 9or this reason,
variable 1 holds a score 12M$ 5ariable 1 sho&s an interesting score of "M as no
firms disclose conditional loss on their income statement$ 5ariable !claims the
highest value &hich means that Bangladeshi firms are very conservative in valuing
inventories$ The other variables are very close to the average value$
Figure 1: The limit of accounting measurement %ariables in Bangladesh
4.": Accounting in Bangladesh and Alternati%e TheoriesD %s accounting practises
in Bangladesh have undergone a lot of changes over the decades, it is better to
reflect on this issue not only from cultural perspective but also from other
perspectives$ /onsidering the facts of accounting in Bangladesh, the researcher
thin(s that ne& institutional theory and political economy theory can provide
additional insights to this point$
Bangladesh, as a developing country highly depends on foreign grants and aids$
9rom the very beginning, this country has been supporting globali?ation trend in
order to maximi?e its potentials both internally and externally, but institutional
&ea(ness, infrastructural bac(&ardness and many other barriers have al&ays
gripped on it$ The adoption of -%s/-94s in Bangladesh is an initiative to cope &ith
globali?ation$ But, it is &ell (no&n that several international organi?ations li(e the
36
Aorld Ban(, %sian 'evelopment Ban( ;%'B> and -nternational 0onetary 9und ;-09>
have al&ays put pressure on the government of Bangladesh to adopt international
accounting standards for transparent financial reporting$ )xisting literatures also
provide evidence in this regard$ 0ir and 4ahman ;!""1> argue that institutional
legitimacy is the prime motive behind the adoption of -%s in Bangladesh$ Their
argument is based on the huge pressure created by donor institutions on the
Bangladeshi government to adopt -%s for ensuring credibility to foreign investors as
&ell as accountability to lending/donor agencies$ Hn this fact, -/0%B ;1999> also
points out that the government of Bangladesh generally (eeps them a&ay from
accounting standard setting process but pressure from international development
partner agencies has led them pursuing the accounting profession to adopt all
applicable -%s/-94s for use in Bangladesh$ 0oreover, many public bodies of
Bangladesh (eep accounting records for external validation$ 3oCue and 3opper
;199.> conduct a study on a state o&ned mill of Bangladesh &here they found that
the accounting system &as mainly a response to ste&ardship and tax matters$ o,
all empirical &or(s suggest that institutional legitimacy plays a great role in the
development of accounting practices in Bangladesh$
%gain, from political economy perspective, it can be said that financial reporting is
used as a tool by capitalists to legali?e their operations in Bangladesh$ mall
investors are vulnerable and highly manipulated by the false corporate reporting$
That is &hy= investors have no faith on the information provided by company
management$ )xisting literatures also support this point$ 0ir and 4ahaman ;!""1>
point out that corruption has become endemic in Bangladesh &hich should get focus
in order to achieve accountability$ Aithout eradicating the culture &hich supports
corruption, accounting and accountability &ould be ,ust formality and rhetoric$
37
4esearchers o&n experience also support the existence of &idespread corruption in
the accounting and reporting practices of private firms of Bangladesh$9urthermore,
o&ing to high competition among audit firms to get clients, some companies no&
believe that their auditors are &illing to do &hat they tell them to do$ everal big
scams in financial reporting have already ta(en place, but no audit firm is punished$
The big fall of Bangladeshi share mar(ets in !""9+ !"1" &hen small investors almost
lost 1"" million pounds is not yet trialled ;8e&el, !"1!>$ -nvestigations from
government of Bangladesh confirm that many individuals, audit firms and listed
companies are involved &ith this mass manipulation, but for some invisible reasons=
government even do not disclose their names to the general public$ These issues
give the impression that accounting is used as an eco+political instrument by a small
class of po&erful capitalists of Bangladesh$
4.1: Culture and +anagement Control in Bangladesh: chneider I Barsoux
;!""#> develop 3ofstede emerging control profiles, dividing the &hole &orld into four
regions$ Bangladesh geographically falls into the %sian region$ )xisting literatures
on management control practises in Bangladesh very much support the profiles
control characteristics for %sian region in Bangladesh$ 3oCue and 3opper ;199.> do
a study over the management control of a Bangladeshi state o&ned ,ute mill and
comment that management have little authority over the operational activities of the
organi?ation$ 3ead office and sponsoring ministry play the dominant role in planning
and control process$ Though budgeting is used as a tool of control, but it is not the
main mode of control and ,ustcreatedto comply &ith head office and tate
reCuirements$ 0ill managers mainly use various forms social/informal control to deal
&ith the uncertainties and complexities surrounding the mills operations and
survival$ imilarly, %lam, 0$ ;1996> points out the existence of bureaucratic
38
environment in all state o&ned enterprises of Bangladesh$ 3e says that in case
ofuncertainty, budgeting is more about the management of external factors rather
than the management of the organi?ation itself in all state o&ned firms of
Bangladesh$ But in case of moderate uncertainty, budgeting appears to be
functional in the management of the organi?ation$
-n another case study, 7ddin ;!""9> comments about accounting and control
practises of a Bangladesh firm as follo&sD management practises are solely for
serving dominant o&ners ;the family members>, ignoring the interests of vast
ma,ority general shareholders$ 0odern concept and/or system of budgeting is absent
&ith no delegation of tas(s to the sub+ordinates$ 9inancial information is only
disbursed to the inner Cuarter of the family, &ho exercised control do&n&ards, not by
financial measurementsbut through imposed physical targets$ ales budgets are
based on mar(ets but &ithout the participation of field &or(ers$ 0aster budget is
totally absent$ 5arious formal and informal sources are used to (eep the focus on
daily and &ee(ly sales in the light of mar(et demand$ The /)H, having direct lin( to
the o&ners or family members, (eeps unlimited po&er and control over production
andother managers$ The managers al&ays stand to execute the orders of o&ners
and chief executive or finance officers$ /ontrol mechanisms over &or(ers are
expected to be coercive as permission is not granted to the researcher to tal( &ith
the &or(ers or trade union leaders$ -n fact, the family set up personali?ed and
centrali?ed control systems over the &hole organisation$
amaratunge, %lam and Teicher ;!""8> mention that there exists a group elite class
such as the rich peasants, the land+o&ning traders, the ne& industrialist class and
the civil and military bureaucracy in Bangladesh and their dominance is paramount$
everalattempts &ere made to flatten the concept of elitism and replace it &ith
39
managerialism, professionalism and responsiveness to citi?en needs$ %ll of those
efforts are ultimately ended &ithout any result$ 8ahan ;!"1!> says that 0erit is not
duly considered in case of appointment in government service of Bangladesh$ 0any
posts are reserved for the party loyalists$ :olitics and faulty recruitment system are
destroying the bureaucracy$ -t seems that leaders are li(e fathers to the party
loyalists in Bangladesh$
o, all these empirical data suggest that chneider and Barsoux ;!""#> profiles
successfully conceptuali?e the control characteristics of %sian region$ %ll these
characteristics exist highly in the control practices of Bangladesh$
4.2: +anagement Accounting and Control in Bangladesh:'uring 199"s,
subsidiaries of 0ulti+national /orporation began to use management accounting
techniCues in Bangladesh$ Gradually, some local companies started to use them$
The number of empirical &or(s on management accounting and control practices in
Bangladesh is very small compare to that on financial accounting$ The reasons are
multifoldD lac( of industrial development, un&illingness of o&ners and increased
costs etc$
har(ar, obhan and ultana ;!""2> conduct a study over 8 manufacturing sectors
of Bangladesh about their management accounting and control practises and find
that sales and sales gro&th are the most commonly used performance measurement
and control techniCues used by all these 8 manufacturing sectors$ Budgets are
revised annually or semi+annually and mostly prepared by director &ithout
40
participation of the employees$ tandard costing is primarily used for budgeting,
performance evaluation and inventory valuation$ -n another similar study by
0a?umder ;!""6>, the findingssay that modern management techniCues li(e %ctivity
Based /osting ;%B/>, Target /osting ;T/>, Total Nuality 0anagement ;TN0>, 8ust in
Time ;8-T> and Theory of /onstraints ;TH/> are not used by the public and private
sector organi?ations of Bangladesh$ Hnly a fe& subsidiaries of 0</s are using the
8-T and the TN0$ <onetheless, traditional management accounting and control
techniCues such as cash flo& statement analysis, financial statement analysis,
standard costing, marginal costing and /ost+5olume+:rofit ;/5:> analysis are &idely
used by local companies$ But, in a more recent study by Beshmin and 3ossan ;!"11>
over 6. manufacturing organi?ations of Bangladesh, the results are a bit different$
They find that manufacturing organi?ations freCuently apply the follo&ing Cuantitative
management accounting techniCuesD cash flo& statement analysis, ratio analysis,
budgetary control, /5: analysis, variance analysis and fund flo& analysis$
Nualitative management accounting techniCues li(e TN0 and TH/ are also used by
significant number of firms$ <o firm use Balance corecard method &hich has both
Cuantitative and Cualitative measurements$ The ex+president of -/0%B &hom the
researcher intervie&ed, &ho is no& &or(ing as independent director in three
corporate houses of Bangladesh also confirms that TN0 and %B/ are no& used
highly by Bangladeshi textile and pharmaceutical industry$ But, 0amun and -slam
;!""!> comment that though some Bangladeshi firms are visibly trying to ma(e
successful implementation of TN0, they are in constant hussle and bussle due to
contextual factors$ uppliers are evaluated individually by the Bangladeshi
companies and not benchmar(ed in against of specific criteria$ 3ence, there is no
documented evidence or ob,ective form of measuring supplier reliability$ <o special
41
Cuality ratings in terms of product attributes are carried out inBangladesh$9inally
resistance to change and scepticism in implementing TN0 practices has proven to
be a ma,or obstacle in theBangladeshi companies
4egarding responsibility accounting practises in Bangladesh, 9ou?ia ;!"11> points
out that in case of assigning responsibility, traditional functional based responsibility
accounting systems is the first choice by most of the service organi?ations$ But, in
case of performance measurement practises, activity based responsibility accounting
systems is the most preferred and the most prominent user is <GHs$ trategic
based responsibility accounting systems is in the bottom position$
%ll the empirical &or(s presented above provide details of different types of
management accounting and control techniCues practiced in Bangladesh$ Hne thing
is clear from here that modern management accounting and control techniCues have
already started to use in Bangladesh$
4.4: +anagement Accounting and Control practises in Bangladesh and
Alternati%e TheoriesD Besides culture, many other factors have influenced
management accounting and control practises in Bangladesh$ 0oreover, control
practises of Bangladeshi organi?ations are getting ne& shape and form day by day
due to various reasons$ The researcher believes that using of alternative theories
could discover additional insights in this regard$ o, <e& -nstitutional Theory,
tructuration Theory of Giddens and :olitical )conomy Theory for less developed
economies are also used in this study to explain the management control practises
of Bangladeshi firms$
)xisting empirical &or(s recogni?e the presence of institutional pressure on local
Bangladeshi firms to change their management practises$ @arim ;!"1#> conducts a
42
study on the adoption of -H 9""" in Bangladesh$ 3e points out that Bangladeshi
managers believe that adoption of -H 9""" is a vital tool for competition and
survival in the global mar(et$ 'espite of all the problems in implementing it, the
benefits received are enormous and &ill continue to sustain$ This certificate is a
licence for many companies to do business &ith local and foreign partners$ 'ue to its
numerous benefits, a safe prediction can be made that more companies &ill
implement -H 9""" in future$ 0amun and -slam ;!""!> find that the adoption of
TN0 in some Bangladeshi companies is a fantasy rather than an essential
component$ This cosmetic initiative may be initiated for Jinstitutional and JCuality
culture, not for purely technical reasons$
4eady 0ade Garments ;40G> is the main export oriented industry of Bangladesh
&hich contributes more than 6"M of foreign currencies receipt$ 'ue to pressure from
international buyers and donor organi?ations, notable improvements have ta(en
place in the corporate practises of this sector$ %ccording to 0c(insey I /ompany
;!"11>, 9#M of the )uropean and 7 /hief :rocurement Hfficers ;/:Hs> believe
that the compliance standard in Bangladesh has some&hat improved ;26M> or
strongly improved ;!2M> &ithin the last five years$ )nvironmental compliance is also
increased due to E/leaner :roduction -nitiativeF by the -9/ of Aorld Ban($
-n another study, amaratunge, %lam and Teicher ;!""8> point out that donor
pressures lead to transform several public sector bodies of Bangladesh into Cuasi+
private institutions$ These Cuasi+privateinstitutions are given autonomy to ma(e
strategic decisions in some areas that bring fundamental shift in the public
management system from a statist+&elfare developmentmodel to a business+li(e
entrepreneurial model$
43
<o previous empirical research is found on the structuration theory of Giddens in the
context of Bangladesh$ But in the findings of 7ddin ;!""9> &here it is reported that
domination via familial influence is very much relevant in Bangladesh, reinstate the
existence of spirit of structuration theory in Bangladesh$ The researchers o&n
experience, intervie& results and some ne&spaper records also support the
presence of this theorys implication in the realities of Bangladesh$ % recent example
can better present the situation$ Hn !.
th
%pril, !"1#, a big commercial building
named J4ana :la?a collapsed in Bangladesh that too( a&ay the lives of 11!9
garment &or(ers$ The crac(s on the building &ere recogni?ed at the very morning on
the accident day$ Aor(ers &ere not &illing to &or( under such a sha(y building but
the factory o&ners threatened the &or(ers that their months salary &ould not be
paid if they did not sho& up at &or( ;0ollah and 3abib, !"1#>$ The &or(ers &ere
forced to come in &or( under this situation and lost their lives$ The criminals to this
heinous act are not only po&erful financially but also politically$ -t is very li(ely that by
using their economic resources and political connection, the criminals &ill ma(e a
safe exit$ Aealthy and politically po&erful people can control many things in their
o&n &ay in Bangladesh$
The elements of political economy theory are better presented in an empirical &or(of
7ddin and 3opper ;!""1>$ This &or( is based on a Bangladeshi soap manufacturing
company named :/ &hich is set up as private venture during :a(istan regime$
Then, after independence of Bangladesh it becomes nationali?ed, but again it is
handed over to private hand in 199#$ The study sho&s ho& different pattern of
management practises are exercised in :/ through its different regime of control$
'uring the period of state control, :/ maintained a comprehensive budgetary control
system &hich &as mainly rule bound and ritualistic$ 0anagersoften ,ust too( the
44
previous years figures and carefully follo&ed the headCuarters instructions$ Trade
unions &ere so strong and ran through rival political party system$ upervisors many
times gave undue benefits to the &or(ers so as to get support for their party in the
annual elections of trade union$ But these scenarios are completely changed &hen
:/ comes under private o&nership in 199#$ The regular and routine &or(s of
budgeting disappear$ The o&ners ,ust pass do&n the physical budgets to production
manager &ho subseCuently transmit it to the factory foreman and supervisors$ <o
financial data is disclosed to the line managers but they are under constant pressure
to cut costs$ The o&ners and top management become the ultimate authority in case
of employee recruitment, promotion, dismissals and all other company related
issues$ 9inancial accounting and reporting become distorted as t&o separate sets of
financial records are (ept$ Hne is for executive directors and another is for outside
sta(eholders$ :hysical budgets are used to measure employee performance and
control over managers, supervisors and &or(ers turn into arbitrary$ Toothless trade
union is used only for formal dialogue &ith the executive director ;)'>$ The internal
labour mar(et is completely destroyed$ The economic dependency of employees
upon ne& o&ners has gro&n substantially$
The alternative theories applied in this study provide a different vie& of accounting
and control practices in Bangladesh$ -t is very much clear+cut from the &or(s of the
scholars that socio+economic conditions, institutional pressure and political history
are playing significant role to shape/reshape accounting and control practices in
Bangladesh
4.5: $ummary: This chapter summari?es the findings from different sources of
information used in this study$ 4esults from annual report analysis sho& that Grays
propositions regarding accounting disclosures, measurement, and consistency=
45
except authority in Bangladesh are acceptable$ Hther empirical &or(s also cross O
verify these findings$ )xisting literatures also strongly support the relevance of
chneider and Barsoux profiles control characteristics for %sian region in
Bangladesh$ )xisting empirical &or(s also hint the presence of several other ma,or
issues ;globali?ation, institutional pressure, political history and socio+economic
conditions etc$> besides culture that have played big role in dictating accounting and
control practices of Bangladesh$ The next chapter &ill present the concluding
remar(s for this study$
5.!: Conclusions: This study examines the effects of national culture and other
forces on accounting and control practises of Bangladesh and provides some
interesting findings$ 9irstly, it presents the relevance of Grays culture/accounting
value hypothetical area propositionsin Bangladesh$ The result indicates that Grays
all propositions except accounting authority are applicable in case of Bangladesh$
econdly, validity of chneider and Barsoux culture/control profiles from the
perspective of %sian region is examined in this study$ )xisting literatures and
evidence from other sources ,ustify that the profiles %sian region control
characteristics truly existin Bangladesh$ Thirdly, it traces ho& different institutional
forces ;Aorld Ban(, -09 etc$> and state coerce professional accounting body and
other listed companies of Bangladesh to adopt -nternational %ccounting tandards
46
;-%s>$ 9ourthly, it sho&s ho& accounting is used as a tool by the Bangladeshi
capitalists to legali?e their operations$ This study raises Cuestions about the
credibility of financial reporting in Bangladesh that should be addressed immediately$
9ifthly, it exhibits ho& and for &hat purposes, management accounting and control
techniCues are started to use in the private and public management sectors of
Bangladesh$ 9inally, it sho&s ho& accounting and control are changed in
Bangladesh due to the change in economic, political and o&nership structures$
The researcher believes that the findings of this study present strong ,udgement
about the influence of national culture and other forces on the accounting and control
practises of Bangladesh as it derives its inputs from triangulated source of data$
)ach and every source of data is used for cross+verification of the findings$
ub,ectivity and biases are tried to minimi?e in every point of data collection$ Hverall,
the findings of this study are genuine &hich can be described as follo&sD accounting
practices in Bangladesh is not as influenced by national cultural as it is by
variousnational and international actors$ But the control practices in Bangladesh are
heavily influenced by its culture, norms and beliefs though global forces are
gradually ma(ing a brea(through in this regard$
%s social systems and practises are dictated and guided by different forces and
pattern of relationships &hich change over time, the researcher believes that there is
al&ays scope to do more research on a particular social issue$ %ny further research
on this issue is highly encouraged by the researcher as it &ill enrich the existing
literatures of international accounting and control and develop clear understandings
of factors that are causing differences in accounting and control practices across the
globe$
47
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!2$ Green&ood, 4$, 3inings, /$4$ and uddaby, 4$, !""!$ Theori?ing /hangeD
The 4ole of :rofessional %ssociations in the Transformation of
-nstitutionali?ed 9ields$ #cade(y of 'ana&e(ent Revie$, .1;1>, pp$ 18+
8"$%vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
!6$ Gray, $8$, 1988$ To&ards a Theory of /ultural -nfluence on the 'evelopment
of %ccounting ystems -nternationally$ #1acus,23;1>, pp$1+11$
!8$ 3abib, %$, !"".$ Nuality of earningsD % conceptual synthesis and preliminary
evidence from Bangladesh$ ournal of !usiness "tudies, xxv ;!>, pp$1#.+1.!$
!9$ 3amid, $, /raig, 4$ and /lar(, 9$, 199#$ 4eligionD % /onfounding /ultural
)lement in the -nternational 3armonisation of %ccountingL #1acus, !9;!>, pp$
1#1+ 1.8$ %vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
#"$ 3arrison, G$ *$ and 0c@innon, 8$ *$, 1999$ /ross+cultural research in
management control systems designD a revie& of the current state$
#ccountin&, .r&ani*ations and "ociety, !.;1+2>, pp$ .8#+1"2$%vailable
throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
#1$ 3asan, T$ and @arim, %$@$0$A$, !""1$ 4egulatory /hange and the Nuality of
/ompliance to 0andatory 'isclosure 4eCuirementsD )vidence from
Bangladesh$ SHnlineT Aor(ing :aper eries, .$ AellingtonD 5ictoria 7niversity
of Aellington$ %vailable atD Q&&&$victoria$ac$n?/sacl/cagtr/&or(ing+
papers/&p#.$pdfR S%ccessed "1 8uly !"1#T$
52
#!$ 3asan, 0$$, 3ossain, $W$ and &ieringa, 4$8$, !"1#$ /orporate
Governance and 9inancial 'isclosuresD Bangladesh :erspective$ Research
ournal of 4inance and #ccountin&, .;1>, pp$ 1"9+119+SHnlineT %vailable atD
QhttpD//&&&$iiste$org/8ournals/index$php/489%/article/vie&/."."R S%ccessed 1
eptember !"1#T$
##$ 3e&ege, /$4$, !"1!$ % /ritiCue of the 0ainstream 0anagement /ontrol
Theory and the Aay 9or&ard$ "#5- .)en, Hctober+'ecember, pp$ 1+
11$%vailable atD QhttpD//sgo$sagepub$com/content/!/./!118!.."1!.6"11.$fullR
S%ccessed "1 8uly !"1#T$
#.$ 3ol?er, 3$:$ and <orre(lit, 3$, 1991$ 0anagement %ccounting and /ontrol
ystems$ %i6dschrift voor -cono(ie en 'ana&e(ent, XXX5- ;#>, pp$!6#+#"1$
SHnlineT %vailable atD QhttpD//&&&$econ$(uleuven$be/rebel//,aargangen/1991+
!"""/1991/tem1991+#/tem1991+#U!6#+#"1p$pdfRS%ccessed "1 8uly !"1#T$
#1$ 3ofstede, G$ 198"$ Cultures Consequences: International Differences in
Work7Related Values+ Beverly 3illsD age :ublications$
#2$ 3ofstede, G$, 1991$ Cultures and .r&ani*ations: "oft$are of the 'ind+
*ondonD0cGra& 3ill Boo( /ompany$
#6$ 3ofstede, G$, !""1$ Culture8s Consequences: co()arin& values, 1ehaviors,
institutions, and or&ani*ations across nations$ !nd ed$ Thousand Ha(sD age
:ublications$
#8$ 3ofstede, G$, 3ofstede, G$8$ and 0in(ov, 0$, !"1"$ Cultures and
.r&ani*ations: "oft$are of the 'ind: Intercultural Coo)eration and Its
I()ortance for "urvival$ #rd ed$ *ondonD 0cGra& 3ill$
#9$ 3opper, T$, et al$, !""9$ 0anagement accounting in less developed countriesD
&hat is (no&n and needs (no&ing$ #ccountin&, #uditin& / #ccounta1ility
ournal, !!;#>, pp$ .29+11.$%vailable throughD 7niversity of Birmingham
library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed 1" 8une !"1#T$
."$ 3op&ood, G$ %$, 196!$ %n )mpirical tudy of the 4ole of%ccounting 'ata in
:erformance$ ournal of #ccountin& Research, 1";#>, pp$ 112+18!$ %vailable
53
throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
.1$ 3oCue, W$, iddiCue, <$%$ and 3opper, T$, 199.$ 0anaging Hrgani?ations in
the Third AorldD a case study of management control in a Bangladeshi ,ute
mill$ ,u1lic #d(inistration and Develo)(ent, 1., pp$ .!1+.#6$
%vailablethroughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !8 8uly !"1#T$
.!$ 3oCue, W$ and %lam, 0$, 1999$ TN0 adoption, institutionalism and changes in
management accounting systemsD a case study$ #ccountin& and !usiness
Research, !9;#>, pp$ 199+!1"$ %vailable throughD 7niversity of Birmingham
library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !8 8uly !"1#T$
.#$ 3usain, $0$ and <asiruddin, $, 1992$ 0anagement control research and
development literature and their implication to the public sector of
Bangladesh+ % critical analyses$ Dhaka University ournal of !usiness
"tudies, 16;1>, pp$ 1!1+1#1$
..$ -n(les, %$, 1929$ 0a(ing men modernD Hn the causes and conseCuences of
individual change in six developing countries$ #(erican ournal of sociolo&y,
61;!>, pp$ !"8+!!1$%vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
.1$ 8e&el, 0$<$$, !"1!$ hare mar(et crash and the reasons behind the
disaster$ %he 4inancial -9)ress, SHnlineT 12 Hctober$ %vailable atD
QhttpD//&&&$thefinancialexpress+bd$com/index$phpL
refV0,Bf0TBf0TWf0T8f05810l8x<'c&0?0VR S%ccessed #1 %ugust !"1#T$
.2$ 8ahan, 0$, !"1!$ 4ecruitment and election :rocess in Bangladesh /ivil
erviceD % /ritical Hvervie&$ ,u1lic ,olicy and #d(inistration Research,!;1>,
pp$ !9+#2, SHnlineT %vailable atD
Q&&&$iiste$org/,ournals/index$php/::%4/article/do&nload/!221/!28"R
S%ccessed #1 %ugust !"1#T$
54
.6$ @ang, T$, et al$, !"".$ The -mpact of /ulture on %ccounting /hoicesD/an
/ultural /onservatism )xplain %ccounting/onservatismLResearch Collection
"chool of #ccountancy :.)en #ccess;$ %vailable atD
QhttpD//in($library$smu$edu$sg/soaUresearch/!61R S%ccessed 1" 8une !"1#T$
.8$ @arim, %$@$0$A$ and %hmed, 8$7$, !""1$ 'eterminants of -% disclosure
compliance in emerging economiesD )vidence from exchange listed
companies in Bangladesh$ SHnlineT Aor(ing :aper eries, !1$ AellingtonD
5ictoria 7niversity of Aellington$ %vailable atD
Q&&&$victoria$ac$n?/sacl/cagtr/&or(ing+papers/&p!1$pdfR S%ccessed "1 8uly
!"1#T$
.9$ @arim, %$, !"1#$ /orporate atisfaction &ith -H 9"""D %n )mpirical tudy of
Bangladesh$ %he ournal of 5lo1al !usiness 'ana&e(ent, <;!>, pp$1+1$S:dfT
%vailable at DQ&&&$,gbm$org/page/1M!"%hmadM!"@arim$pdfR S%ccessed !8
8uly !"1#T$
1"$ *arbi, G$, !""1$ :erformance contracting in practiceD )xperience and lessons
from the &ater sector in Ghana$ ,u1lic 'ana&e(ent Revie$, # ;#>, pp$ #"1+
#!.$ %vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
11$ 0acintosh, <$B$ and capens, 4$A$, 199"$ tructuration Theory in
0anagement %ccounting$ #ccountin&, .r&ani*ations and "ociety, 11;1>, pp$
.11+.66$
1!$ 0amun, 0$W$ and -slam, <$, !""!$ Total Nuality 0anagement ;TN0>
:ractices of the Bangladeshi and Thai /ompaniesD % comparative
analysis$:a(istans eventh -nternational /onvention on Nuality
-mprovementD Hctober !2+!6$ @arachiD 0arriott 3otel$%vailable
atQhttpD//gsdl$easternuni$edu$bd/greenstone/collect/6eufacultypub/index/assoc
/3%3"19e$dir/doc$pdfR S%ccessed !8 8uly !"1#T$
55
1#$ 0assey, '$$, 1981$ 'imensions of the ne& immigration to the 7nited tates
and the prospects for assimilation$ #nnual Revie$ of "ociolo&y, 6, pp$ 16+81$
%vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
1.$ 0a?umder, B$/$, !""6$ %pplication of 0anagement %ccounting TechniCues in
'ecision 0a(ing in the 0anufacturing Business 9irms in Bangladesh$ %he
Cost and 'ana&e(ent, #1;1>, pp$ 1+18$
11$ 0c&eeney, B$, !""!$ 3ofstedes model of national culturaldifferences and
their conseCuencesD %triumph of faith O a failure of analysis$ 0u(an
Relations, 11;1>, pp$ 89+118$ %vailable throughD 7niversity of Birmingham
library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !8 8uly !"1#T$
12$ 0c(insey I /ompany, -nc$, !"11$ Bangladeshs ready+made garments
landscapeD The challenge of gro&th$ S:dfT9ran(furtD 0c(insey I /ompany,
-nc$ %vailable
atDQhttpD//&&&$mc(insey$de/sites/mc(Ufiles/files/!"11U0c@inseyUBangladesh$
pdfR S%ccessed !8 8uly !"1#T$
16$ 0ir, 0$W$ and 4ahaman, %$$, !""1$ The adoption of international accounting
standards in BangladeshD %n exploration of rationale and process$
#ccountin&, #uditin& / #ccounta1ility ournal, 18;2>, pp$812+8.1$ SHnlineY
%vailable atD
QhttpD//&&&$adoptifrs$org/uploads/Bangladesh/0irU4ahamanUThe
M!"adoptionM!"ofM!"-%M!"inM!"Bangladesh$pdfR S%ccessed 1" 8une
!"1#T$
18$ 0ohiuddin, 0$G$, !"1!$3uman 4esource 'evelopmentD Bangladesh
:erspective$ ournal of 0u(an Ca)ital Develo)(ent, 1;1>, pp$ 9+!1$SHnlineT
%vailable at DQhttpD//,hcd$utem$edu$my/index!$phpL
optionVcomUdocmanItas(VdocUvie&IgidV1!8I-temidV99999999R
S%ccessed "1 8uly !"1#T$
56
19$ 0ollah, $ and 3abib, A$B$, !"1#$ -t crumbles li(e a pac( of cards$ %he Daily
"tar SHnlineT, !1 %pril, %vailable atD
QhttpD//&&&$thedailystar$net/beta!/ne&s/li(e+a+pac(+of+cards+it+crumbles/R
S%ccessed #1 %ugust !"1#T$
2"$ <air, 4$'$ and 9ran(, A$G$, 198"$ The -mpact of 'isclosure and
0easurement :ractises on -nternational %ccounting /lassifications$ %he
#ccountin& Revie$, 11;#>, pp$ .!2+.1"$%vailable throughD 7niversity of
Birmingham library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6
%ugust !"1#T$
21$ <obes, /$A$, 198#$ % 8udgemental -nternational /lassification of financial
4eporting :ractices$ ournal of !usiness 4inance / #ccountin&, 1";1>, pp$ 1+
19$ %vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
2!$ Htley, '$T$, 1968$ Budget use and managerial performance$ ournal of
#ccountin& Research, 12;1>, pp$1!!+1.9$ %vailable throughD 7niversity of
Birmingham library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !8
8uly !"1#T$
2#$ Htley, '$T$, Broadbent, 8$0$, Berry, %$8$, 1991$ 4esearch in management
controlD an overvie& of its development$ !ritish ournal of 'ana&e(ent, 2
;special issue>, pp$ #1O#.$%vailable throughD 7niversity of Birmingham
library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust
!"1#T$
2.$ :arry, 0$ and Grooves, 4$ 199"$ 'oes training more accountants raise the
standards of accounting in Third Aorld /ountriesL Research in %hird World
#ccountin&, 1, pp$116+."$
21$ :erera, 0$3$B$, 1989$ To&ards a frame&or( to analy?e the impact of culture
on accounting$ %he International ournal of #ccountin&, !., pp$ .!+12
57
22$ 4oberts, 8$ and capens, 4$, 1981$ %ccounting systems and systems of
accountability + understanding accounting practices in their organisational
contexts$ #ccountin&, .r&ani*ations and "ociety, 1";.>, pp$ ..#+.12$
26$ amaratunge, 4$, %lam, N$ and Teicher, 8$, !""8$ :ublic sector reforms and
accountabilityD The case of south and outheast %sia+ ,u1lic 'ana&e(ent
Revie$, 1";1>, pp$ 1"1+1!2$%vailable throughD 7niversity of Birmingham
library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !8 8uly !"1#T$
28$ audagaran, $0$, !"".$ -nternational %ccountingD % user perspective$
SHnlineT$ !nd ;)ds>$ %ustraliaD Thomson+*earning$
%vailableat DQhttpD//&&&$myboo(e???$com/international+accounting+a+user+
perspective+!nd+edition/R S%ccessed !6 %ugust !"1#T$
29$ chneider, $/$ and Barsoux, 8+*$, !""#$ 0anaging %cross /ultures$ !nd ed$
3arlo&D :earson )ducation$
6"$ cott, A$4$, !"".$ -nstitutional TheoryD /ontributing to a Theoretical
4esearch :rogram$ S:dfT %vailable
at DQhttpD//icos$groups$si$umich$edu/-nstitutionalM!"TheoryM!"Hxford".$pdfR$
S!8 8uly !"1#T$
61$ har(ar, 0$W$3$, obhan, 0$%$ and ultana, $, !""2$ 0anagement
%ccounting 'evelopment and :ractices in Bangladesh$ !R#C University
ournal, --- ;!>, pp$ 11#+1!.$
6!$ hields, 0$ '$, 1998$ 0anagement accounting practices in )uropeD a
perspective from the tates$ 'ana&e(ent #ccountin& Research, 9;.>, pp$
1"1+ 11#$%vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
6#$ huy, 4$ A$, !""#$ J-n+person versus Telephone -ntervie&ing in 3olstein, 8$
%$ and Gubrium, 8$ 9$ ;)ds> -nside -ntervie&ingD <e& *enses, <e& /oncerns,
Thousand Ha(sD age :ublications$
6.$ tede, A$%$5$'$, !""#$ The effect of national culture on management control
and incentive system design in multi+business firmsD evidence of
58
intracorporate isomorphism$ -uro)ean #ccountin& Revie$, 1!;!>, pp$ !2#+
!81$ S:dfT%vailable atD
QhttpD//im$univie$ac$at/fileadmin/userUupload/pro,U&indsperger/@9@/@f@//ultur
eandHrgani?ation$pdfR S%ccessed 1" 8une !"1#T$
61$ udar&an, 0$ and 9ogarty, T$8$, 1992$ /ulture and accounting in -ndonesiaD
an empirical examination$ %he International ournal of #ccountin&, #1;.>, pp$
.2#+.81$%vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
62$ imons, 4$, 1991$ /ontrol in an %ge of )mpo&erment$ 0arvard !usiness
Revie$, 6#;!>, pp$ 8"+88$ %vailable throughD 7niversity of Birmingham library
&ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
66$ The -nstitute of /hartered %ccountants of Bangladesh$ !"1!$ Vision, 'ission
/ Values, SHnlineT %vailable atD QhttpD//&&&$icab$org$bd/index$phpL
optionVcomUcontentIvie&VarticleIidV1#2I-temidV1#1RS%ccessed 1
eptember !"1#T$
68$ The -nstitute of /ost and 0anagement %ccountants of Bangladesh
;-/0%B>$1999$ %nnual 4eport 1999, -/0%BD 'ha(a, Bangladesh$
69$ The -nstitute of /ost and 0anagement %ccountants of Bangladesh$ !""6$
Vision / 'ission, SHnlineT %vailable atD QhttpD//&&&$icmab$org$bd/index$phpL
optionVcomUcontentItas(Vvie&IidV1.I-temidV.1R S%ccessed 1 eptember
!"1#T$
8"$ Thurmond, 5$, !""1$ The point of triangulation$ ournal of =ursin&
"cholarshi), ##;#>, pp$!1.O!12$ S:dfT %vailable at
QhttpD//&&&$ruralhealth$utas$edu$au/gr/resources/docs/the+point+of+
triangulation$pdf$RS%ccessed !8 8uly !"1#T$
81$ 7ddin, $<$, 1996$ 0anagement controlD % critical analysis of theoretical
underpinnings$ Dhaka University ournal of !usiness "tudies, 18;!>, pp$!81+
#"6$
59
8!$ 7ddin, $ and 3opper, T$, !""1$ % Bangladesh soap operaD privatisation,
accounting, andregimes of control in a less developed country$ #ccountin&,
.r&ani*ations and "ociety,!2, pp$ 2.#+26!$%vailable throughD 7niversity of
Birmingham library &ebsite Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6
%ugust !"1#T$
8#$ 7ddin, $ and 3opper, T$, !""#$ %ccounting for :rivatisation in BangladeshD
Testing Aorld Ban( /laims$ Critical ,ers)ectives on #ccountin&,1., pp$ 6#9+
66.$ %vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
8.$ 7ddin, $, !""9$ 4ationalities, domination and accounting controlD % case
study from a traditional society$Critical ,ers)ectives on #ccountin&,!", pp$
68!+69.$ %vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !8 8uly !"1#T$
81$ Aidener, $@$, !""6$ %n empirical analysis of the levers of control
frame&or($ #ccountin&, .r&ani*ations and "ociety,#! ;6+8>, pp$ 616+688$
%vailable throughD 7niversity of Birmingham library &ebsite
Q&&&$birmingham$ac$u(/libraries/ R S%ccessed !6 %ugust !"1#T$
82$ Beasmin, $ and 4ahman, @$9$, !"1!$ GTriangulationG 4esearch 0ethod
astheTool of ocial cience 4esearch$ B7: 8ournal, 1;1>, pp$ 11.+12#$ S:dfT
%vailable atD QhttpD//&&&$bup$edu$bd/,ournal/11.+12#$pdfR$ S%ccessed !9
%ugust !"1#T$
86$ Beshmin, 9$ and 9o&?ia, 4$, !"1"$ 0anagement %ccounting :racticesD %
/omparative %nalysis of 0anufacturing and ervice -ndustries$ #"#
University Revie$, .;1>, pp$1#1+1.1$
88$ Beshmin, 9$ and 3ossan, 0$%$, !"11$ ignificance of 0anagement
%ccounting TechniCues in 'ecision+ma(ingD %n )mpirical tudy on
0anufacturing Hrgani?ations in Bangladesh$ World ournal of "ocial
60
"ciences, 1;1>, pp$1.8+12.$ S:dfT%vailable atD
QhttpD//&biaus$org/1"$M!"9ar,anaM!"+9-<%*$pdfR S%ccessed 1" 8une !"1#T$
Appendi/ A: Chec#list for 9eneral (isclosures
Items Comply Non;
Comply
1$ -nformation about company formation, o&nership
structure, registered office is disclosed$
!$ The nature of companys operations and its
principle activities are disclosed$
#$ Basis of financial statement preparation &ith other
basic accounting policies are disclosed to ma(e fair
presentation of financial position$
.$ % statement regarding business policy from the
chairman of the company is disclosed$
1$ % statement regarding business policy from the
/hief )xecutive officer is disclosed$
61
2$ 'irectors reports to the shareholders are disclosed$
6$ /omparative statement of financial information is
made in annual report$
8$ Total value addition for the year is disclosed by a
statement$
9$ /orporate ocial 4esponsibility report is provided in
annual report$
1"$ % post balance sheet update is issued to the
shareholders
Appendi/ B: Chec#list for Balance $heet (isclosures
items Comply Non;
comply
1$ The balance sheet present the minimum number of line
items as per -% 1L
!$ The further sub+classification of the line items is made$
#$ The additional line item is presented &ith headings and
totalsL
4. %ny uncertainty ;if> &ith the amount and timing of the
item is fairly presented$
1$ )ach class of property, plant and eCuipment ;::)> is
disclosed at gross amount at the beginning and the
closing of the period$
2$ The accumulated depreciation for each class of ::) is
disclosed$
6$ There is a reconciliation account of the carrying
amount for each class of ::)L
8$ The effective date of revaluation is given in case of
::) revaluation$
9$ The name of independent revie&er ;if any>, in case of
revaluation$
1"$ The disclosures of costs and revenues &ith
62
depreciated amount in case of disposal of any ::)$
11$ The modes of disposal are mentioned$
1!$ The name of the buyer in case of disposal is
mentioned$
1#$ The value of investment property is disclosed at fair
value ;if possible>= other&ise valued at cost$
1.$ The reconciliation account for investment property is
given$
11$ The methods and assumptions used for valuing
investment property are disclosed$
12$ The name of independent revie&er ;if any>, in case of
revaluation$
16$ The methods and assumptions used for valuation of
financial instruments are mentioned$
18$ The intangible assets are properly disclosed &ith their
carrying amounts$
19$ The methods and assumptions used for valuing
intangible assets are disclosed$
!"$ The disclosures regarding investment in associates are
made$
!1$ The disclosures regarding interest in ,oint ventures are
made$
!!$ The disclosures regarding subsidiary interest are
made$
!#$ 'isclosures regarding inventories are made in totals
&ith sub+ classifications$
!.$ The details of receivables &ith various parties are
disclosed$
!1$ The details of payables &ith various parties are
disclosed$
!2$ The methods and assumptions regarding provision for
bad debts are disclosed$
!6$ The presentation of deferred tax assets and deferred
63
tax liabilities are separate on balance sheet$
!8$ The presentation of current income tax assets and
liabilities are separate on balance sheet$
!9$ The provisions are disaggregated into various parts on
balance sheet$
#"$ The nature for each class of provision is disclosed$
#1$ The indications ;if any> are given regarding the
uncertainties about the amount and timing of
provisions$
#!$ There are disclosures regarding the post+employment
benefit of employees$
##$ The lease assets are sho&n into operating and capital
segment$
#.$ The relationships bet&een parents and subsidiaries in
related party transactions are disclosed$
#1$ The nature of the transactions in related party
transaction is disclosed$
#2$ The disclosures for each class of contingent liability,
unless remote, are made$
#6$ The disclosures about accrued expenses and pre+paid
expenses are made$
#8$ The amount of dividends ;proposed or declared> is
disclosed$
#9$ The non+ad,usting event that may affect business
substantially is mentioned$
."$ The details of share capital are given$
Appendi/ C: Chec#list for Income $tatement (isclosures
items Comply Non;
comply
1$ %ll income and expenses, recogni?ed during the period are
presented in a comprehensive single statement$
64
!$ The minimum number of line items presented in the
statement of comprehensive income as per -% 1$
#$ The disclosure on finance income is made$
.$ The disclosure on finance expense is made$
1$ Hther sources of income are mentioned$
2$ 'isclosures relating to cost of sales are made$
6$ 'isclosures relating to administrative, selling and
distribution expenditures are made$
8$ 'isclosures relating to cost of goods manufactures made ;if
any>
9$ 'isclosures are made regarding emoluments to directors
and managers$
1"$ 'isclosures are made about the income tax$
11$ General charges applicable for the year are disclosed$
1!$ %ll contributions to employees provident fund and pension
fund are disclosed$
1#$ 4esearch and development expenditures are disclosed$
1.$ <o items of extraordinary income and expense are
presented on the income statement$
Appendi/ (: Chec#list for $tatement of Cash Flo's (isclosures
Items Comply Non;
comply
1$ The statement of cash flo& is presented into three
partsD operating, investing and financing activities$
!$ eparate disclosures are made for gross receipts and
paid in case of investing and financing activities$
#$ The amount of tax paid is disclosed
4. :aid tax is presented as operating activities$
1$ The amount of interest received from T' and 9'4 is
disclosed$
2$ The amount of interest paid is disclosed$
6$ The amount of dividend received is disclosed$
8$ The amount of dividend paid is disclosed$
65
9$ 'isclosures are made about the change in long term
borro&ings$
1"$ 'isclosures are made about the change in short term
borro&ings$
11$ /ash flo&s from acCuisitions and disposals are
presented separately and sho&n as investing activities$
12. /ash and cash eCuivalent components are disclosed$
13. 'isclosures regarding obtaining cash from disposal of
subsidiaries are made$
14. 'isclosures regarding paying cash for acCuisition of
subsidiaries are made$
11$ /ash flo&s from discontinued operations ;if any> are
disclosed$
12$ <et transfers from capital &or( in progress account
are mentioned$
16$ Total paid to vendors for capital items are mentioned$
18$ The amount of cash ;if any> held by the entity that is
not available for use by the group$
19$ /ash :roceeds from issuance of share to non+
controlling interest are disclosed$
!"$ %dditional information or commentary is given by
management about the liCuidity position of the
business$
Appendi/ 0:Chec#list for Accounting Policies (isclosures
-tems /omply <on+
comply
1$ The measurement basis used in preparing in financial
statements is disclosed$
!$ Hther accounting policies are also disclosed for better
66
understanding of financial statements$
#$ The nature of the assumption or other estimation
uncertainty is disclosed$
.$ /onsolidation principles, including accounting for
subsidiaries are disclosed$
1$ /onsolidation principles, including accounting for
associates are disclosed$
2$ :olicies for business combination are made$
6$ 9oreign currency transaction and translation issues are
disclosed$
8$ The measurement basis for property, plant and
eCuipment is disclosed$
9$ The depreciation method for property, plant and
eCuipment is announced$
1"$ The useful lives of property, plant and eCuipment are
stated$
11. 5aluation model for investment property ;fair value or
cost model> is disclosed$
12. 5aluation model for intangible assets is announced$
13. 'epreciation method and useful life for intangible
assets are disclosed$
14. Treatment of research costs is clarified$
15. -nventory valuation model is disclosed$
12$ 4evenue recognition method is disclosed$
17.'efinition of cash and cash eCuivalents is made$
18$ Tax policies are disclosed$
19$ :rovision policy is announced$
!"$ %ny change in accounting policy is disclosed$
Appendi/ F: <uestions from semi;structured inter%ie' 'ith the e/;president of
IC+AB=.
3ello, my name is 0ohammad 4a(ib 7ddin Bhuiyan$ - am conducting this intervie&
&ith you on management accounting and control issues of Bangladesh$ The
67
outcome of the intervie& &ill be used in a research &or(, underta(en by the
intervie&er$
N$1D /ould you please give me an idea &hen and ho& management accounting
techniCues &ere started to use in commercial organi?ations of BangladeshL
N$!D Ahat are the motives behind the uses of management accounting techniCues in
commercial organi?ations of BangladeshL
N$#D 'o the organi?ations follo& formal or informal or both procedures in practising
management accountingL
N$.D Ahat do you thin( about the external or internal pressure on local company
management about the adoption of advanced management accounting techniCuesL
N$1D 'o the firms ,udge their employees on the basis of performance or personal
relationshipL
N$2D Ahat forms of control are used in the organi?ation of BangladeshL %re they
coercive or consent basedL
N$6D 'oes the control system allo& employees to thin( independently or to
participate in decision ma(ing systemL
N$8D 'o you thin( change in o&nership structures and political environment influence
the control pattern in the organi?ations of Bangladesh$
Than( you very much for giving me your valuable time$ - assure you that your
information &ill neither use for any illegal purposes nor for any negative impact to
both you and others$
68
Z <oteD additional follo& up Cuestions &ere made during the intervie&$
Appendi/ 9: <uestions from inter%ie's 'ith the director of audit firm=.
3ello, my name is 0ohammad 4a(ib 7ddin Bhuiyan$ - am doing this intervie& &ith
you on accounting, auditing and control issues of Bangladesh$ The proceedings of
the intervie& &ill be used in a research &or(, conducted by the intervie&er$
N$1D 'o you thin( financial reporting by firms serve its purposes in BangladeshL
N$!D 'o you thin( listed companies in Bangladesh are &illing to disclose the facts to
the publicL
N$#D 3o& successful the audit profession in Bangladesh is in ensuring Cuality audit
reportingL 'o the auditors maintain integrity and ob,ectivity in performing their
accounting and auditing functions to the societyL
N$.D %s you do visit and audit many listed companies, &hat are your opinions about
the uses of accounting information in controlling employees of the organi?ationL
N$1D 3o& do firms use accounting information in controlling the human resources of
the organi?ationL
N$2D 'o you support the concept of coercion in the &or(ing environment of local
commercial organi?ation of BangladeshL
N$6D Ahat forces do you thin( are bringing change in accounting and control
practices of Bangladeshi firmsL 3o& do they play their rolesL
69
Than( you very much for giving me your valuable time$ - assure you that your
information &ill neither use for any illegal purposes nor for any negative impact to
both you and others$
Z <oteD additional follo& up Cuestions &ere made during the intervie&$
Appendi/ -: &ist of $elected Firms
1$ %/- *imited$
!$ %/- 9ormulations *imited$
#$ %ftab %utos *imited$
.$ Bata hoe /ompany ;Bangladesh> *imited$
1$ Bangladesh *amps *imited$
2$ Beximco ynthetics *imited$
6$ Beximco :harmaceuticals *imited$
8$ B40 teels *imited$
9$ 0$ -$ /ement 9actory *imited$
1"$ Glaxomith@line Bangladesh *imited$
11$ Grameenphone *imited$
1!$ 3eidelberg /ement ;Bangladesh> *imited$
1#$ @ohinoor /hemical /ompany *imited$
1.$ *afarge urma /ement *td$
11$ BH/ Bangladesh *td$
12$ 0arico ;Bangladesh> *imited$
16$ <avana /<G *imited$
18$ Nuasem 'rycells *imited$
19$ 4%@ /eramics ;Bangladesh> *imited$
!"$ 4angpur 9oundry *imited$
!1$ 4ec(itt Benc(iser ;Bangladesh> *imited$
!!$ 4enata *imited$
!#$ hinepu(ur /eramics *imited$
!.$ Cuare Textiles *imited$
!1$ $ %lam /old 4olled teels *imited$
!2$ alvo /hemical -ndustry *imited$
!6$ ummit %lliance :ort *imited$
!8$ Cuare :harmaceuticals *imited$
!9$ inger Bangladesh *imited$
#"$ ummit :o&er *imited$
70