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Question: The changeover of Russia's economy from socialism to free enterprise has strongly influenced Russian business culture. Employees, who for generations have depended on the government to fulfill their needs, now have the opportunity to get ahead individually. Russian business culture-the way Russians do business-is changing gradually. An example of this change can be seen in the accounting profession. In the emerging Russian market economy, the person performing the role of accountant is called an "economist." These employees have a degree in "economics" and years of experience. Employees performing the role of "bookkeeper" have lower status and lower pay. The chief bookkeeper, however, has a prominent position because of his or her responsibility for the accuracy of financial statements. The accounting profession in Russia is devising a regulatory framework based upon similar frameworks in existing market economies. Regulations are being written that include precise definitions for accounting terms. Regulations on the qualifications of auditors also are being developed.
Critical Thinking
1. What are the advantages if the accounting standards in Russia are similar to those in the rest of the world?
2. What factors might require that some accounting standards differ from those in other countries?
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