Accounting for control and trust building in interfirm transactional relationships

Ed Vosselman and Meer-Kooistra, Jeltje van der

Accounting, Organizations and Society, 2009, vol. 34, issue 2, pages 267-283

Abstract: This paper theorises the accounting-control-trust nexus in interfirm transactional relationships. In the context of such relationships, accounting has predominantly been conceptualised as a control technology. However, in our paper we analyse stable and durable relationships as being the results of interaction between control and trust building. Such an analysis calls for an additional conceptualisation of accounting as a trust building technology. Furthermore, we explain the interaction between accounting for control and accounting for trust building in the context of a process of embedded agency. Accounting for control is underpinned by a governance structure, which includes accounting structures that have the potential to act as safeguarding and incentivizing devices with the aim of aligning long-term interests. The governance structure is flanked by trust from the institutional environment of the transactional relationship. Accounting for trust building originates from voluntary local decisions to show commitment to the relationship. It takes the form of ad hoc calculations and accounts and becomes a device for relational signalling. Adequate interaction between accounting for control and accounting for trust building results in stable and durable interfirm transactional relationships.

Date: 2009

Downloads: (external link)
http://www.sciencedirect.com/science/article/B6VCK ... 67dde04eb94d42c64614
Full text for ScienceDirect subscribers only

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: http://EconPapers.repec.org/RePEc:eee:aosoci:v:34:y:2009:i:2:p:267-283

Access Statistics for this article

Accounting, Organizations and Society is edited by A. G. Hopwood

More articles in Accounting, Organizations and Society from Elsevier
Series data maintained by Heidi Boesdal ().