A comparative history of accounting traditions in China and Japan

Abstract

The political differences between Chinese and Japanese imperial systems offer a foundation for this study of accounting traditions in East Asia. For much of pre-modern history, the Chinese empire had a highly centralised power structure in which accounting gradually became a political institution that supported the emperor's power of governance. In pre-modern Japan, however, political control was largely shared by the shogunate and local clans of feudal lords, diverting power away from a central monarch. In such an environment, Japanese accounting traditions were orientated towards the business interests of major merchants, rather than the political interests of a centralised state. These political variances also underpin the different journeys that both countries have taken in their transition to embrace Western-style accounting practices from the late nineteenth century. This comparative history reinforces that accounting is highly responsive towards broader socio-political structures, adapting to the specific needs of changing circumstances in particular contexts.