Development of corporate accounting in Australia

              Robert W. Gibson DEAKIN UNIVERSITY
DEVELOPMENT OF CORPORATE ACCOUNTING IN AUSTRALIA1
Abstract: Corporate accounting in Australia can be said to have passed through four phases. The initial phase involved the introduction of minimum standards of statutory disclosure. The second phase was largely an extension of these statutory requirements to include income statements and consolidated statements. This was followed by the activities of the accounting profession, stock exchanges and others to improve the details of disclosure.
The final phase which is still under way has directed attention more and more to the problems of accounting measurement reflected in the financial statements. It has been marked by efforts to formulate accounting standards and to enforce compliance with those standards. Modern developments have been marked by a gradual shift from change based on statutory demands towards change based on the role of such non statutory influences as the accounting profession.
Introduction
An outstanding Australian civil engineer connected with the build-ing of the highway system, Sir Louis Loder,2 once described how this development took place in four phases. When he first drove Highway 1 between Melbourne and Sydney, after 60 miles from Melbourne it literally became a track winding through the trees. It therefore was necessary to clear the trees and "get out of the bush". ("bush" is Australian for wildwood or "the sticks"). The track thus established soon became a wet season quagmire and work was needed to "get out of the mud". The gravel roads then became a summer time nightmare of clouds of dust and the task was to "get out of the dust". Now that the road is bituminised or black topped the task is to apply safety engineering in an effort to "get out of dangers". Finally it must be noted, the adoption of modern safety engineering and road rules does not solve the problem of securing compliance with those rules and we need the services of the high-way patrol. All of these highway developments have been witnessed in one man's lifetime. There is an analogy between this and the development of Australian corporate accounting which has taken place over little more than the traditional lifetime of three score years and ten.