Accounting for Change: Accounting, Finance, and Changing Methods of Economic Regulation in Post-Socialist Eastern Europe

Abstract

The collapse of state socialism and the promises of the postsocialist era have made ‘accountability’ an acutely felt issue in Eastern Europe, both in the broad senses of ‘good governance’ and ‘transparency,’ and in the narrower sense of visible, verifiable financial records. Under socialism, accounting (and, more broadly considered, finance) was a central method of economic and political regulation. As a key technology of the planned economy, socialist accounting promised that its new methods of tracking the movements and uses of property were the keys to both economic development and social equality. Of course, it was a spectacular failure: socialist accounts were notoriously unreliable (Verdery, 1996, pp. 20–1).

‘Many of the interconnections and interdependences between accounting and the wider context in which it operates go unobserved and are seldom articulated, having become part of accounting as it is. Constituting the silent realm of accounting, their salience becomes apparent only when more radical discontinuities puncture the world of accounting, raising questions about the adequacy of the craft … Accounting change is therefore never an unproblematic endeavour but rather a process that occurs amidst a complex of other influences that sometimes provide the possibility of such change and sometimes constrain the possibility of it.’ (Hopwood, 1992)

Earlier versions of this chapter benefited from comments by Katherine Verdery, Michael Power, Monika Kostera, Mihaela Kelemen and Barbara Brown, and I thank them very much. Research was funded by a grant from the National Science Foundation for which Katherine Verdery was the principal investigator. Writing was completed under the auspices of the Wissenschaftskolleg zu Berlin. I am grateful to both these institutions for their support.