The power of words: explaining recent accounting reforms in the Australian public sector

Abstract

This study explores the power of words and their usage in the context of recent reforms to accounting regulation for the Australian public sector. The broad framework for analysis advanced by Mills (1989) is applied. Mills argued that the discipline of accounting is peculiarly dependent on a specialised vocabulary or terminology, both in determining the nature and content of accounting regulation and practice and also in shaping the accounting domain. According to Mills, given such a close relationship between accounting and its vocabulary, the analysis of the use of key words in accounting during particular periods in history can assist our understanding of important events in the development of accounting thought and practice. It is argued that the definition and interpretation of the terms “accrual accounting” and “asset” were integral to the presentation of a form of accounting conventionally applied to private sector firms as the “solution” to perceived financial management problems in the Australian public sector. This study seeks to augment existing literature by adding to our understanding of the role of altruistic discourse in promoting and justifying changes to accounting practice.