Japanese Culture Factors Influenced the Disclosure of Financial Information
Japanese culture factors influenced the disclosure of financial information
Japan is an unique oriental country in many aspects, especially in politics and economy, both western practices and traditional nationalism are coexisted in this country. The period 1890-1940 was just followed the Meiji restoration, and was typical in the history of Japan, at that time, Japan was on the way from a feudal country to a capitalistic country, called modernization. Many western practices were being more and more adopted, however, at the same time, traditional rules still had strong influences in Japan. Under this background, this report will discuss the Japanese cultural factors during 1890-1940 that influenced the disclosure …show more content…
Old bakufu-serving firms that clung to their traditional ways failed in the new business environment. The government was initially involved in economic modernization, providing a number of "model factories" to facilitate the transition to the modern period. After the first twenty years of the Meiji period, the industrial economy expanded rapidly until about 1920 with inputs of advanced Western technology and large private investments. Stimulated by wars and through cautious economic planning, Japan emerged from World War I as a major industrial nation.
Market-oriented economy is the aim of Meiji restoration, but the power of government intervention cannot be neglected, government supports the establishment of modern institutions, and sends students to study economy in western countries, and at this time, western accounting methods begin to be adopted by Japan. Before 19th century, there was a limited demand for accounting disclosure in respect of the foreign investment, it happened after losses to foreign investors. In 1909, government recognized accountant as a profession, and professional accountant appeared in 1890. In 1927, there were around 300 accountants and this recognition became legislation. In 1934, Ministry of Commerce codify the rules for financial statement and also issue manuals for munitions factories' statements after a short beginning of World War II.
In the Meiji period (1868-1912),