The Institutional Environment of Financial Reporting Regulation in ASEAN

The growth of regional trading blocs and economic alliances such as the European Union (EU) and the North American Free Trade Agreement (NAFTA), has served to magnify interest in cross-national aspects of financial reporting regulation. While most of the extant literature has looked at developed industrialized countries, this article focuses on the principal features of the institutional environment for financial reporting in an economic bloc of developing countries—the Association of Southeast Asian Nations (ASEAN). These countries are currently the subject of much attention due to the Asian economic crisis. The article has several objectives. First, it highlights the principal features of the institutional structure of financial reporting regulation in ASEAN countries. Second, it helps understand how these features impact on and are affected by several issues, particularly the limits of private sector participation in regulatory affairs, and the need to improve the enforcement in these countries. Finally, it also studies the international dimensions of financial reporting regulation in ASEAN and considers whether ASEAN's institutional arrangements provide an auspicious environment in which to pursue accounting harmonization.