Abstract
This paper discusses the evolution of financial reporting in Japan from approximately 1850 to date and considers whether developments have been influenced by its shame culture. Double-entry bookkeeping developed, in part, as a result of the political, economic and social changes introduced in the early Meiji period. Of great significance was the development of the limited liability company, a form of business organization advocated by government with considerable alacrity which was not recognized in law until the 1899 Commercial Code. A major change in the financial reporting environment occurred after the Second World War as a result of the democratization programme introduced by the Allied Forces, mainly the US. While the regulatory framework imposed upon Japan has been modified somewhat, the nucleus remains intact.

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