Money, politics, and the regulation of public accounting services: Evidence from the Sarbanes-Oxley Act of 2002

    Authors

    S. Thornburg;R. W. Roberts

    Comments

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    Abbreviated Journal Title

    Account. Organ. Soc.

    Keywords

    CAMPAIGN CONTRIBUTIONS; UNITED-STATES; MODEL; Business, Finance

    Abstract

    Because public accounting is a regulated practice, the profession actively manages its relationship with the state. While prior studies have analyzed the profession's efforts to shape its regulatory environment, few studies have examined the profession's pointed attempts to influence a specific regulatory policy that affects the practice of auditing in the United States. Drawing on extant theories of regulation and political economy, this study investigates the rationality and effectiveness of political action committee (PAC) contributions paid to members of the US Congress by the US public accounting profession during the policy formulation period of the Sarbanes-Oxley Act of 2002. Based on the results of empirical tests, we conclude that the US profession strategically manages its relationship with the federal government, in part, through direct involvement in the financing of political campaigns. Furthermore, the profession's pattern of contributions implies an ideologically conservative as well as a professional regulatory motivation for providing financial support to federal legislators. Thus, although the US profession continues to proclaim the primacy of its public interest orientation, it does not appear to be politically neutral when attempting to influence public policy. (c) 2007 Elsevier Ltd. All rights reserved.

    Journal Title

    Accounting Organizations and Society

    Volume

    33

    Issue/Number

    2-3

    Publication Date

    1-1-2008

    Document Type

    Article

    Language

    English

    First Page

    229

    Last Page

    248

    WOS Identifier

    WOS:000253792200005

    ISSN

    0361-3682

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