Commentary: A theoretical model of stakeholder perceptions of a new financial reporting system

This commentary is about the article by Fontes et al. published in this issue of Accounting Forum. They argue that their model provides improved understanding of individual characteristics and perceptions of financial reporting users, preparers and auditors that allow regulators and standard setters to devise strategies to cope with a range of implementation problems associated with new financial reporting systems. Their argument is based on an assumption that a better understanding of change processes is required in order to bring about financial reporting system change. They draw upon research from the social sciences to build a multiple factor model to measure stakeholder perceptions of the relative ‘value’ of different financial reporting systems. This commentary reflects on some of the assertions of the model in relation to the social and organisational processes of how accounting standards are changed and on the possibility of combining a multiplicity of factors into a meaningful value or values. Individual perceptions of the possible future value of a financial reporting system are so contextually and socially defined that it is difficult to see how they could be empirically incorporated into their theoretical model. From their literature review the authors have collated an impressive, though not complete, range of factors that may have some impact on some stakeholder's perceptions of the value of financial reporting change. However, the nature, diversity and complexity of factors identified in this paper are such that that they cannot be adequately captured using their proposed model.