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Authors

Kyojiro Someya

Publication Date

1989

Abstract

Japan's rise from a feudalistic economy to a position as a leading industrial power is a result, in part, of two revolutionary changes in its accounting structure. The first change came during the latter part of the nineteenth century as part of the Meiji Government's program of modernization. Various political, economic, and cultural institutions were adopted from the West, among them the double-entry method of bookkeeping; this method gradually replaced very unsatisfactory traditional methods. The second change came after World War II, when the Allied Command set as its objective the destruction of the Zaibatsu-dominated industrial structure and its replacement with a democratic economy, in which industrial capital is accumulated through the participation of investors in a free stock exchange. Such a change demanded a shift in emphasis from stewardship-oriented financial reporting to investor-oriented financial reporting.

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