The role of the state and transnational accounting bodies in the development of accounting associations in developing countries

Abstract

This study examines accounting professionalization processes in Ethiopia to explain ho the state, professional group action and transnational competition of professional accounting bodies influence operationalization of closure. It employs a qualitative research approach based on evidence gathered via document review and oral history approaches. Findings show that professional accounting associations in Ethiopia could not operationalize closure mainly because this strategy did not originate from the rationale for association formation. Accounting professionalization was initiated by the state rather than occupational group mobility for jurisdictional control. The state as a major employer set a trend of developing accounting professionals as government-employed experts. Thus, key professionalization moves pre and post-association formation did not benefit from the momentum that created the associations. Further, indigenous professional association's co-optation of transnational accounting associations made the former's attempt for jurisdictional control exigent because jurisdictional vacancies are de facto occupied by the latter. This study is the first to illustrate how the rationale for association formation influences the operationalization of closure. It also shows how dominant state power and transnational competition of professions influence professionalization in non-market centric economies. These aspects have been neglected in the literature as accounting professionalization has largely been examined in the context of Western societies where the market and professional group action serve as dominant organizing forces for professions and the logic of closure provides the rationale for association formation as well as guides post-formation activities.