Beginnings of financial reporting and premises of consolidation of accounts in French aluminium industry,1921-1939

Didier Bensadon ()
Additional contact information
Didier Bensadon: DRM - Dauphine Recherches en Management - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique

Post-Print from HAL

Abstract: The expansion of groups of companies during the inter-war years is one of the most profound transformations in the structure of French capitalism. Studies in economic history have shown the importance of the subsidiary creation phenomenon in relation to Compagnie Générale d'Electricité, Energie industrielle or Schneider . By contrast, these studies are less interested in the specific arrangements for auditing subsidiaries and managing Company Groups. This article seeks to show how and why the directors of Alais, Froges et Camargue - The largest French company in the aluminum sector- established specific audit measures from the 1920s onwards. This research is essentially based on the company's archives (annual reports, general organisation chart and memoranda from the general secretariat). Even if the results published in the annual reports should be treated with the utmost caution, in particular owing to the absence of accounting regulation in France in the inter-war years, they remain essential for assessing the important position of subsidiaries and main shareholdings in assets. The scope of the subsidiary creation phenomenon, which is behind the establishment of specific controls, is highlighted. This trend, far from being linear, is strongly influenced by the economic and political situation. The size of the Group's growth gave rise to two types of requirements for the directors of Alais, Froges et Camargue, namely to audit the subsidiaries and to measure the group's net cash flow. The response to the need for auditing the subsidiaries was provided by the introduction of financial reporting from 1921. Faced with the increasing number of subsidiaries and main shareholdings held by Alais, Froges et Camargue, this control mechanism was to be strengthened in 1931. Furthermore, the necessity of measuring the Group's net cash flow led the directors in 1927 to draw up a financial statement whose conceptual foundations were based on those of the consolidation of accounts

Keywords: financial reporting; accounting history; group accounts; French aluminium industry; shareholdings.; shareholdings (search for similar items in EconPapers)
Date: 2011-11-03
New Economics Papers: this item is included in nep-acc, nep-his, nep-hme and nep-hpe
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00640503v1
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in IAAER - ACCOUNTING RENAISSANCE Lessons from the Crisis and Looking into the Future. Learning from Histories and Institutions, Nov 2011, Venise, Italy

Downloads: (external link)
https://shs.hal.science/halshs-00640503v1/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00640503

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().