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Standardising oil and gas accounting in the US in the 1970s: insights from the perspective of regulatory capture

Journal Article


Abstract


  • Attempts by the Financial Accounting Standards Board (FASB) to standardize oil and gas accounting in the 1970s has been referred to as the “most politicised accounting argument ever” (Van Riper, 1994, p.56). Marking the only instance in which the Securities and Exchange Commission (SEC) has declined to support the FASB’s standards, the failure of the FASB to limit accounting method choice has had lasting implications with divergent methods still practised by oil and gas companies today. This study presents a narrative of this development and specifically examines the events through the lens of regulatory capture theory to show that the industry was successful in capturing the regulatory process and securing its preferred outcome.

Publication Date


  • 2011

Citation


  • Cortese, C. (2011). Standardising oil and gas accounting in the US in the 1970s: insights from the perspective of regulatory capture. Accounting History, 16 (4), 403-421.

Scopus Eid


  • 2-s2.0-81555222827

Ro Metadata Url


  • http://ro.uow.edu.au/commpapers/1371

Has Global Citation Frequency


Number Of Pages


  • 18

Start Page


  • 403

End Page


  • 421

Volume


  • 16

Issue


  • 4

Abstract


  • Attempts by the Financial Accounting Standards Board (FASB) to standardize oil and gas accounting in the 1970s has been referred to as the “most politicised accounting argument ever” (Van Riper, 1994, p.56). Marking the only instance in which the Securities and Exchange Commission (SEC) has declined to support the FASB’s standards, the failure of the FASB to limit accounting method choice has had lasting implications with divergent methods still practised by oil and gas companies today. This study presents a narrative of this development and specifically examines the events through the lens of regulatory capture theory to show that the industry was successful in capturing the regulatory process and securing its preferred outcome.

Publication Date


  • 2011

Citation


  • Cortese, C. (2011). Standardising oil and gas accounting in the US in the 1970s: insights from the perspective of regulatory capture. Accounting History, 16 (4), 403-421.

Scopus Eid


  • 2-s2.0-81555222827

Ro Metadata Url


  • http://ro.uow.edu.au/commpapers/1371

Has Global Citation Frequency


Number Of Pages


  • 18

Start Page


  • 403

End Page


  • 421

Volume


  • 16

Issue


  • 4