Trajectories of accounting and auditing development in EU enlargement: comparative analysis of ten new member states

This paper presents comparative qualitative analysis of the development of accounting and auditing in the ten member states which joined the European Union in May 2004, eight with transition economies and two with established but emerging market economies. The post-communist eight shared many similarities at the outset of transition but subsequent economic and political experiences were strongly divergent. In contrast, Cyprus and Malta had established market economies (but at relatively lower levels of development than more established EU member states). Compared with the transition eight they also differed in having established accounting and auditing professions. The paper’s research questions and associated hypotheses address varying institutional characteristics and comparative inter-temporal institutional change among the ten member states. In testing these hypotheses we use qualitative analysis on descriptive data developed as part of the official EU evaluation of accession states’ suitability for membership. In adopting this research approach we are consistent with a range of studies of institutional change which have been undertaken in an EU context, largely in political theory and political economy. We find evidence that different trajectories of institutional development are observable in the ten new member states. This research thus documents a major exercise in pan-European regulatory change, adds to the record of the transition to market structures and institutions of eight transition economies, and assists understanding of accounting development in two emerging economies. Furthermore, it informs understanding of processes under way for other EU applicants and for new membership applications which may arise in future.