The Accounting Historians Journal Vol. 18, No. 2 December 1991
John Richard Edwards THE UNIVERSITY OF WALES COLLEGE OF CARDIFF
THE PROCESS OF ACCOUNTING INNOVATION: THE PUBLICATION OF CONSOLIDATED ACCOUNTS IN BRITAIN IN 1910
Abstract: The first known example of a consolidated balance sheet published by a British company was made available to shareholders of the Pearson and Knowles Coal and Iron Company Ltd. in 1910. This paper examines the reasons for this accounting change and investi-gates the source of the necessary expertise. The conclusion reached is that, in common with many other accounting innovations, evolution-ary change occurred as the result of modifications to an existing busi-ness practice.
The process of change in accounting is a topic of both interest and importance; however, as a number of writers have pointed out, it remains a neglected area requiring further research [Hopwood, 1987; Previts, Parker and Coffman, 1990]. Change may come about as the result of an invention (revolutionary change) or the gradual development of a new technique as the result of nu-merous minor modifications to an existing practice (evolutionary change). The more widespread use of the new method may occur, in turn, either voluntarily or as the result of regulation. Parker  has identified the following as important 'change agents': textbooks, teachers, companies, government agencies, accounting organizations, accountants and businessmen.1
The purpose of this paper is to explore the process of account-ing change by focusing on the decision made by the directors of the Pearson and Knowles Coal and Iron Co. Ltd. (PK Ltd.), in 1910, to publish a consolidated balance sheet. To achieve this ob-jective, the paper:
1Parker was focusing principally on the international diffusion of accounting thought and practice, and his nomenclature has been amended and extended to cover intranational dissemination.