A personal finance columnist for the NZ Herald

Inside Money: Why accountants need more culture and less court-time

Photo / Thinkstock
Photo / Thinkstock

Allan Hubbard, we are told, "had little interest" in complying with accounting rules.

As a trained accountant, Hubbard, at least, would've understood what he wasn't complying with. But the niceties of best-practice double-entry accounting are probably lost on most of us.

And that's the problem with society today, according to Jacob Soll. In his book 'The reckoning: financial accounting and the making and breaking of nations', Soll claims the world would be a better place if the art of double-entry had a more elevated status in the cultural universe.

Accountants, he says, used to be the subject of artistic endeavours.

"But great artists don't paint accountants anymore," Soll writes. "It is not surprising. In the wake of fiascoes like Enron, accountants have come to be perceived not only as boring but also as venal and inexpert."

'The reckoning' does a great job of making accounting appear, if not exciting, less boring that its reputation has it. Soll's rollicking historical narrative ties the success of various societies to their respective cultural engagement with accounting.

Despite all those centuries of accounting advances how come we still get Madoffs and Rosses and South Canterbury Finances?

"No sooner is an accounting reform made than we find a way to resist it," Soll says.

"Indeed, the rise of technology has made the task of accountability even more daunting, as regulators and even auditors come up against labyrinthine big numbers and financial logarithms, high-speed trading, and complex financial products..."

He argues we need to bring accounting back into the cultural mainstream, where it apparently resided from time to time over the last 700 years.

"By separating finance into its own sphere, we have lowered our financial and political aspirations," Soll writes.

Maybe if there were more interest in accounting-based reality TV shows, music and films, for example, there would be fewer court cases featuring unbalanced bookkeepers.

- NZ Herald

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A personal finance columnist for the NZ Herald

David is a freelance journalist who has covered the financial services business on both sides of the Tasman for over 15 years. He is the editor of industry website Investment News. David has edited magazines and websites for the financial advice, investment and superannuation industries.

Read more by David Chaplin

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