The Politics of Rule Development: A Case Study of Australian Pension Fund Accounting Rule‐Making

Describing the politics surrounding accounting rule development may provide greater insights to such processes than analysing written submissions to rule‐making bodies. Over a twenty‐year period a rule‐making contest evolved between the accounting profession and an alliance of pension industry interest groups over the introduction of different forms of regulation (accounting standards versus legislative‐backed rules) relating to pension fund accounting. From the perspective of government, the debate about pension fund accounting reflects the outside‐initiative model (Cobb and Elder, 1972; Cobb et al., 1976). Issues were created by the (accounting and actuarial) professions, expanded in the relevant (pension and life insurance) industry and then gained entrance to the formal agenda of both regulatory and government deliberations. In this case the accounting profession failed to gain acceptance of its professional rule‐making activities. Alternative possible explanations as to why the alliance of interest groups eventually prevailed over the accounting profession are explored.