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Corporate financial disclosures in the UK, 1920–50: the effects of legislative change and managerial discretion

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  • A. Arnold
  • D. Matthews

Abstract

During the period 1920–50, the legislative approach to corporate financial disclosure in the UK was transformed. Although the changes have been well covered in the literature, the actual levels and patterns of change in UK corporate disclosures, which reflect the effects of both legislative requirements and managerial discretion, have attracted relatively little attention. The main purpose of this paper is to provide a sound empirical basis for conclusions about disclosure practices in the UK across the second quarter of the last century. To that end, the paper provides a structured discussion of changes in corporate disclosures in the UK, based upon detailed analysis of a substantial and broadly based body of corporate data for the years 1920, 1935 and 1950. These dates provide, respectively, a starting point that falls within the coverage of the main existing studies of UK disclosures of the first quarter of the twentieth century, a mid-point that allows for evaluation of the effects of the Companies Acts 1928–9 and the Royal Mail case of 1931 and a closing date that incorporates the effects of the 1948 Act. The relationship between the state and the financial community and its various agencies are clearly of importance, and particular attention has been paid to the effects of managerial discretion on disclosures, given Edwards' view that criticisms aroused by the revelations of the Royal Mail case of 1931, ‘probably had a greater impact on the quality of published data than all the Companies Acts passed up to that date’.

Suggested Citation

  • A. Arnold & D. Matthews, 2002. "Corporate financial disclosures in the UK, 1920–50: the effects of legislative change and managerial discretion," Accounting and Business Research, Taylor & Francis Journals, vol. 32(1), pages 3-16.
    • Handle: RePEc:taf:acctbr:v:32:y:2002:i:1:p:3-16
    DOI: 10.1080/00014788.2002.9728951
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    References listed on IDEAS

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    1. Matthews, Derek & Anderson, Malcolm & Edwards, John Richard, 1998. "The Priesthood of Industry: The Rise of the Professional Accountant in British Management," OUP Catalogue, Oxford University Press, number 9780198289609.
    2. Lee, G. A., 1975. "The Concept of Profit in British Accounting, 1760–1900," Business History Review, Cambridge University Press, vol. 49(1), pages 6-36, April.
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    Cited by:

    1. Billings, Mark & Capie, Forrest, 2009. "Transparency and financial reporting in mid-20th century British banking," Accounting forum, Elsevier, vol. 33(1), pages 38-53.
    2. Turner, John D., 2024. "Three centuries of corporate governance in the UK," QUCEH Working Paper Series 24-01, Queen's University Belfast, Queen's University Centre for Economic History.
    3. David Chambers, 2007. "New issues, New Industries and Firm Survival in Interwar Britain," Working Papers 7002, Economic History Society.
    4. Tauringana, Venancio & Chithambo, Lyton, 2015. "The effect of DEFRA guidance on greenhouse gas disclosure," The British Accounting Review, Elsevier, vol. 47(4), pages 425-444.

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