ABSTRACT
This chapter discusses how corporate reporting has been influenced by a large number of quite different factors. The political and economic system, the taxation system and the corporate financing system all tend to influence the demand for accounting information and the objectives served by the financial reporting system. The most important users of financial statements may be shareholders, creditors or taxation authorities. The type of legal system in a country and the strength of the accounting profession tend to influence who regulates corporate reporting and the rigidity of the regulations. The regulatory structures and the users of corporate reports influence the specific measurement rules adopted and the extent of disclosures made, whether mandatory or voluntary. Religious beliefs may influence accounting regulation and practice, both in the interpretation and application of international financial reporting standards, and in the development of national regulation for financial and non-financial disclosures. Accounting rules and practices may be imported or exported. The chapter provides the institutional context for comparative research studies that are indicated as examples in subsequent chapters. It complements the discussion of the cultural context in the following chapter.
