The rise of accounting controls in British capitalist enterprises

Abstract

This paper represents an attempt to understand the historical factors which have led to the comparative pre-eminence of accountants in British management hierarchies and the emphasis on financial modes of control within British companies. It is argued firstly that the nature of British capital markets exaggerated the significance of the audit, thus establishing a power-base for the profession from which it was able to sponsor its own preferred modes of internal control and so strengthen its position in management structures. Secondly, the mode of wartime state intervention in this country favoured "external" accounting controls as a means of avoiding more directive forms of industrial mobilisation, in line with the policy of maintaining the operation of laisser-faire capitalism as far as possible. Thirdly the profession has played some part in the successive waves of merger which have occured in British industry and has proposed on the basis of offering financial solutions to the control problems of the resulting large organisations.