Investigating Institutional Development of Government Accounting

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Management and control of public sector organizations have been considerably changing over last few decades (Olson, Guthrie et al. 1998). Collectively the list of these changes- closely related to market oriented- are classified as New Public Management (NPM). There is a growing need for fundamental changes in the way public organizations are structured and managed (Barzelay and Armajani 1992; Osborne and Gaebler 1992). Public management reforms are called as "Managerialism" (Pollitt 1990; Donald 1997); "Market Based Public Administration" (MBPA) (Lan and Rosenbloom 1992); "Entrepreneurial Government" (EG) (Osborne and Gaebler 1992); "New Public Management (NPM)" (Hood 1991). Instead of different names, this paradigm got the name of New Public Management (NPM) labeled by Hood, (1991, p.3). All these paradigms have emphasized on 'public service', a new administrative orthodoxy (Olsen 1997).

In public sector literature, planned organizational change has been interchangeably and synonymously used with reform and even, some authors (Ingraham 1996; Minogue 1998; Box 1999; Khan 2002) are including privatization and downsizing in the NPM reforms package. The whole package focuses on reducing the size of the state and looking for greater efficiency in the management of the public sector. The spotlight of all these changes is the financial side of the public sector organizations to manage the public money in efficient and effective manner as public organizations, espeically in developing countries like Pakistan, have been under pressure and mass public's crisitisim for bad management of scare public resources and money. All these resulted into growing interest in the governement accounting and accountability. Pakistan has inherited accounting system from the British, and with the passage of time it has developed institutional accounting system. It has been following the international accounting standards and has been member of International Standard. At the same time the it has been under international crisitism for accountability as the Interantoinal Transparency reports are showing decreasing ranking about accountability.

"The result has been the pursuit of policies of restraint on public spending, the selling of public assets, the adoption of market models and the promotion of performance measurement, auditing and business accounting system for a wide range of public sector organizations" (Olson, Guthrie et al. 1998, p. 17).

All these measures resulted in more liberal government with minimum intervention; improvements in efficiency and effectiveness; greater customer focused through responsiveness and accountability. These changes emerged into highly motivated and efficient private sector. Pakistan has no exception from all these global wave of public sector changes and it also resulted into stimulated private sector, an alternative provider's public goods and services. But it is important to investigate; to what extent the package is actually being put into practice in developing countries, like Pakistan.

The public sector reforms have been named such as 'New Public Management (NPM)'and 'New Public Financial Management (NPFM)'. The transformation of the traditional public administration to public management remained the focus of all these reforms (Lapsley 1999, p.201). The idea behind this transformation is that public sector can be managed like private sector, and can make it more financially result oriented. It will result into efficiency, effectiveness and accountability in delivering public services (Paul 2001, p.166).

Inspired by these reforms, many countries especially OECD countries have carried out substantial changes in their public sector. According to Hood (1995, p.93), it is due to the strong attachment to the financial management reforms that NPM movement is regarded global phenomenon. 'New Public Financial Management (NPFM)', a subset of NPM reform package, particularly focuses on accounting change (Ellowood and Wynne, 2005). The primary accounting change has been a shift towards full accrual accounting with a significant emphasis on financial reporting and public accountability (Perrin 1998, p.7). It is apparent that traditional cash basis accounting, in many OECD countries, is being replaced by accrual accounting, leading to the preparation of profit and loss accounts and balance sheets. Additionally, financial performance is being evaluated on the basis of results, rather than cash spending.

Although the countries are moving in the same direction in search for good governance in public service delivery, there exist differences in the intensity of reforms (Guthrie, Olson et al. 1999 p.210). There is a substantial element of diversity in the pace, nature and extent of NPM and NPFM reforms across OECD countries.

In 1998, Olson, Guthrie and Humphrey presented their findings of two years study (Edt book) conducted in eleven different countries as New Public Financial Management (Olson, Guthrie et al. 1998). Their studies go beyond the generalized NPM reforms, specifically focusing on accounting techniques. The important aspect of NPM movement is the "endless list of accounting-based techniques that are being drawn on in the pursuit of reform" (ibid, p.18). NPFM, like any emerging field, faced with problems of terminology as a result it is "replete with jargon-terms such as `accrual accounts', `performance indicators', `delegated budgets', `devolved budgets', `full costs', `output groups', `outcome statements', `accrual output based budgeting' and `fiscal responsibility statements'" (ibid, p.210). Olson, Guthrie and Humphrey are of the view that although there are some similarities among those jargons in some national cases, however, 'actual practice' indicates significant differences in how concepts are applied and operatioanalized. This particular study will focus on the application and operationalization of these NPFM concepts in the public sector of Pakistan. (bring this paragragh up)


The ideas of global business are getting attention with the recent advancements in financial and information technology. In emerging and developing economies, like Pakistan, the success or failure of business depends on how the outside world understands its business practices. How business organizations measure, summarize and present economic reports to shareholders is an integral part to understand the nature of the business. This research project will focus on the understanding and developments in the government accounting system in Pakistan from the lens of institutional theories (Miller 1994; Scapens 1994; Carruthers 1995). The emphasis will be on the factors that may facilitate or impede accounting reforms, practices and disclosures in Pakistan.

Earlier researchers (DaCosta, Fisher et al. 1980; Nair and Frank 1980) focused on the development, classification and diversity of accounting practices in various groups of countries. Recent accounting research (Bergevarn & Mellemvik, 1995; Doupnik & Salter, 1995; Gernon & Meek, 2001; Meek & Saudagaran, 1990; Meek & Thomas, 2004) concentrated on the environmental factors as economic development, nature of business corporations and their interactions and relationships with capital providers, economic ties, political alliances, legal system of the country (common law vs. code law), inflations, tax laws, and level of literacy in the country.

This study will contribute to the literature about the government accounting development as Pakistan has unique research setting. Islamic Republic of Pakistan, located in great economic potential region, is following International Accounting Standards (IAS), now called International Financial Reporting Standards (IFRS), since 1985 (Ashraf and Ghani, 2005). This research will also be contribution to the vacuum about accounting research about Islamic countries as Meek and Thomas (2004) argue that accounting development research in Islamic nations have been mostly left out.

Government of Pakistan has been offering promising investing opportunities to foreign investors [1] . International financial institutions such as the Asian Development Bank (ADB), International Monetary Fund (IMF), the World Bank, the USAID, and the Paris Club have been involved in the economic development of Pakistan. These multilateral financial institutions have their vested interests about how their funds are spent to benefit the economy of Pakistan. From this perspective, this research will explore the historical role of these multilateral institutions in the accounting changes in Pakistan. In this way, this research will also explore the learning aspects in the government accounting in Pakistan. Who Pakistan learned or can learn from their own experience in implementing government accounting changes? Who can Pakistan learned or can learn from the experience of others? The research studies of Levitt and March (1998) and Dolowitz & March (2000) will guide to study the organizational learning aspects of government accounting in Pakistan.


The accounting system in Pakistan is inherited from the British with a long illustrative history. Successive governments of Pakistan have recognized the issue of government inefficiency and they have devised many reforms but the consequences have been uneven. To study the government accounting changes in Pakistan, the research will try to answer the following research questions;

What are the background factors for introducing the accounting changes in Pakistan?

How do executive and political leaders perceive accounting system in Pakistan?

How do various factors influence the accounting system in Pakistan and to what extent they determine the degree of its implementation?

Does learning takes place in the accounting system?


Located in the South Asia, Pakistan (population of more than 140 million) has previously remained colony of the British Raj. In 1947, India and Pakistan emerged as sovereign states in the Indian Sub-Continent. The disputed area of Kashmir has caused several wars between Indian and Pakistan, demands for political solution since independence 1947. Until 1971, West Pakistan and East Pakistan, separated by 1000 miles of Indian's territory, worked together. In 1971, East Pakistan declared itself as independent country as Bangladesh.

The population of Pakistan has been alarmingly growing (fourfold since independence) at an average of 2.8% annually since 1981. According to the census of 1998 (latest), rural population was 71.7% in 1981 has declined to 67.5% in 1998. This population shift exerts fabulous pressure on the urban infrastructure. Over the last five decades, the gross domestic product (GDP) of Pakistan has grown at an average of 5%. The GDP growth remained significantly less than its rate of population in 1970-71, 1992-93, and 1996-1997.

Agriculture-base economy (25% to GDP) is the source of income for majority of the population lived in rural areas employing 44% of the work force. Agriculture is also the main source of foreign exchange earnings. Manufacturing remained the second largest sector (17% of GDP) of the economy including leather, rubber and plastic, paper, chemical, and textile. Cotton and cotton based textile industry is the backbone of industrial economy of Pakistan employing the 38% of industrial work force. The major finished export products include cotton-fabrics, cotton-yarn, knitwear, readymade garments, bed-wear, synthetic textiles, sports good, carpets, surgical instruments, and leather manufactures. The major imports include machinery and transport equipments, petroleum products, agriculture and other chemicals, and food items. Pakistan is facing large trade deficit since 1951.


Accounting history in the subcontinent can be traced to an ancient time. Gladwin (1796 cited in Scorgie and Nandy, 1992) suggested that in 1583, in India there was a Hindu method of accounting system replaced by the Persian mode. He is of the view that the Hindu method of accounting was 'double entry' system. Hamilton (1798 cited in Nigam, 1986) is of opinion that the Bengali traders were using double-entry system of Hindu method of accounting. Lall Nigam (1986) taking support from the Hamilton argued that the Indian accounting system traveled to Italy as the Indian exporters went to Italy for trading purposes. Nobes (1987) argue that Lall Nigam could not provide any physical support to his claim; however, Indians were using bilateral forms for accounting purposes and may not be double-entry system (Scorgie & Nandy, 1992).

According to Saeed (1993), formal accounting system in India had been practiced in the middle of 19th century during the British rule over Indian subcontinent. They introduced the Companies Acts of 1850 and 1857 requiring companies to submit their accounts including half year audits and reports of auditors. In 1883, British enacted companies Act of 1883 having detailed audit guidelines for the appointment, duties and remuneration of auditors.

The companies Act 1913 mandated every company to maintain their accounts including: (1) Sales and purchases of company, (2) receipts and payments (3) assets and liabilities. Under this law only those person can act as auditor who have the provincial government issued auditor's certificate. The central government also has the rights to issue such auditor's certificates to the members of professional bodies as institute of Chartered Accountants of Scotland (ICAS), the Institute of Chartered Accountants in England and Wales (ICAEW), and Institute of Chartered Accountants of Ireland (ICAI), recognized as qualified auditors. No examination was mandatory for obtaining these practitioner's certificates. In 1918, the Government of Bombay started Government Diploma in Accounting. In 1932, the Government of India formalized rules for the examination and training requirements for obtaining license to audit. After independence in 1947, Pakistan adopted the company's act 1913 and audit rules, 1932 (Saeed, 1993).

In 1952 the practicing accountants, towards the development of professional institution to secure their own interests, discussed the accounting problems with government and for the first time in Pakistan they formed private institute called Pakistan Institute of Accountants (PIA). These negotiations of PIA with the government resulted in the formation of Institute of Chartered Accountants of Pakistan (ICAP) in 1961. The formation of ICAP was the major development in accounting profession since independence 1947. The persistence pressure from PIA and realizing the stature and importance of the accounting profession, the government in 1966 established Institute of Cost and Management Accountants of Pakistan (ICMAP) in order to regulate the cost and management accountants' profession (Saeed, 1993).

According to Ashraf & Ghani (2005) until 1971 the financial reporting requirements of the company's act 1913 remained in force even though the Third Schedule to the Companies Act was rudimentary and incomplete. Qureshi (1975) also indicating the weaknesses in financial reporting system in Pakistan, given in the Third Schedule of company's act 1913:

"It does not suggest a classification of assets according to their nature, such as current assets, fixed assets, intangibles, long term investments and so forth; intangibles like good will, trade marks, patents, etc. are described as fixed assets; and preliminary expenses and underwriters commission lack proper classification. There is no suggestion to classify the capital and liabilities side of the balance sheet into current liabilities, long-term liabilities, and shareholder's equity. Profit or deficit is not shown as part of or deduction from stockholders equity, instead, the deficit appears separately on the asset side of the balance sheet. Similarly, the un-appropriated balance of profit is listed as an item of liability and not as part of equity. The provision for bad and doubtful debts is shown as a reserve and not as deduction from receivables."

Qureshi (1975) further identified other limitations in the financial reporting practices;

"…various sources of revenue were distinguished, but the gross revenue was not broken down by product line, major business activities or by different segments in case of a conglomerate. Valuation of year end inventory was described such as lower of cost or market value but the method applied for relating different cost of products acquired to periodic revenues such as LIFO, FIFO, AVERAGE was not disclosed. Similarly in twenty out of thirty reports that were examined, auditors had relied on certificate given by the management regarding the valuation of year end inventories and no audit report had mentioned the fact that inventories were not covered by their opinion."

In 1970, the government established the Securities and Exchange Authority, semi-autonomous organization, with the task to improve the financial reporting procedures in the country. They, for the first time, mandated listed companies to publish semi annual account. "Equally important was the requirement to disclose transactions between the associated companies describing the aggregate sales, purchases, and balance transfers" (Ashraf & Ghani, 2005, p.183). Pakistan joined the International Accounting Standard Committee (IASC) in 1974. ICAP recommended to their corporate customers to prepare their financial reports in conformity with international accounting standards as Pakistan did not has their own national accounting standards. The listed companies were not bound to prepare their financial reports in conformity with the international accounting standards, International Financial Reporting Standards IFRS, until the introduction of the Companies Ordinance 1984 (ibid). Unlisted companies were still not following these standards.

According to the country corporate environment the Companies Ordinance 1984 required some critical issues like, (1) disclosure of the chief executive, directors, and auditor's remunerations, (2) regulating transactions, and (3) directors were required to disclose in the company accounts:

Any commitments and material changes affecting the company's financial position

Any changes occurred during the financial year relating to the nature of business of the company and its subsidiaries, unless regulatory authority, Securities and Exchange Commission of Pakistan, exempts

Complete explanation about the auditor's report regarding their observation, reservation, adverse remarks, qualification,

Information, in the prescribed form, about the pattern of holding shares, earning per share

Justifications for losses and appropriate future prospects for profits

According to the amendments of 1999 in the company ordinance 1984, the directors were required to disclose information about 'default on payments of debt' and its 'reasons'.

According to Ashraf and Ghani (2005) the financial reporting system of the listed companies improved during 1990s because of the new accounting standards issued by International Accounting Standards and Board (IASB). Securities and Exchange Commission of Pakistan (SECP) adopted these standards by the recommendation of Institute of Chartered Accountant of Pakistan (ICAP).

Code of Corporate Governance 2002 is another major development in financial reporting system of Pakistan. Several features of it refer to financial reporting issues including: conformity with IFRS in the preparation of financial statements, information about internal control design, implantation and monitoring, directors view about the ability of the corporation, data about next year financial activities, explanation about non-declaration of dividends, and names of shareholders including institutional shareholders, details of directors, and details about associated companies. For the first time in Pakistan, under the Code of Corporate Governance, 2002, listed companies are required to disclose quarterly un-audited accounts. Earlier half yearly accounts were mandated for the listed companies. Companies are also required to present a compliance statement with the Code of Corporate Governance in their annual reports and auditors are required to give opinions about the compliance with the Code.

In the above section, I shed light on the evolution of (institutional structure) accounting and financial reporting system in Pakistan. I will explore, in next section, different environmental variables that may shape accounting and financial system in the context of public sector of Pakistan.


This research will base on the theoretical perspectives developed in the field of public accounting. Also I can see the increasing interest and as a result sufficient literature on NPM and NPFM seems very relevant and applicable to the field of accounting especially government accounting.

"To talk about the nature of the universe and to discuss questions of whether it has a beginning or an end, you have to be clear what scientific theory is" (Hawking, 1988 as cited in Bacharach, 1989:496) and transforming "clusters of variables" into work theories to guide both researchers and policymakers is a challenges (Sinclair, 2001:78). Theory simplifies the complexity of the empirical world on the basis of explanation and predictions (Bacharach, 1989:489). The function of the theory is to provide shield to researcher from being dazzled by the complexity of natural or concrete events (Hall and Lindzy, 1957 as cited in Bacharach, 1989, p.496).

Theory application is one of the basic principles for this scientific research. It is one of the components [2] of 'golden triangle' in the research design, I have used. Theory discusses specific aspects of a framework, making relationships among a limited number of main factors/variables and tries to make predictions about policy outcomes. Theories used in this study in relation to the objective of the study points out those elements that may have particular significance for answering research questions about the government accounting in Pakistan.

The vital role of theories in all kinds of research studies is obvious. According to Schensul, et al., (1999) theories give guidance to research. To investigate about an issue, the researcher can take guidance from the preordained theories, can formulate a theoretical framework using different theoretical approaches (as I did in this study) or they can develop a new theory based on their analysis of collected data. Most research studies contain elements of theory testing and theory construction (Layder, 1998). The usage of theoretical approaches also has some critics. For example, theoretical propositions or theories may bias or limit the findings of the research study. According to Glaser and Strauss (1967) some of the theories may lack of grounding in data, do not fit, or are not sufficiently understandable to be used for research.

In recent years the government accounting is hard topic for debate (Burns & Scapens 2000). The environment in which accounting systems are practiced has changed because of the developments in technology, different organizational structures, competitive markets, and new management practices (Ezzamel et al., 1996). As a result the usage of accounting within organization has also changed and managers are using accounting systems and financial reports more flexibly both for financial and non financial purposes.

Institutional theory has gained increasing focus across social sciences (Scott, 1995) and according to Burns and Scapens (2000) accounting has been studied in the light of three such institutional theories namely: new institutional (or transaction cost) economics (Walker, 1998); old institutional economics (Scapens, 1994) and new institutional sociology (Carruthers, 1995). There are differences in the origins and intellectual roots among these theories but they share common factors for institutions and institutional change.


This research on transferability of NPFM strategy and Government accounting practices in Pakistan will benefit Pakistan and its public sector organizations. A number of reform efforts, central focus remained financial management, have been made to transform the traditional bureaucratic structure since independence 1947. Despite these efforts, Pakistani public sector is not efficient and effective. Given successful NPM and NPFM oriented reforms in other countries, the Pakistani government has a lot of hard works to do on its reform process yet. For example, defining the role of state, identifying the core functions of government, introducing the market mechanism in the public sector to make the public services more competitive, downsizing the public sector, contracting out public services, and decentralizing administrative power and authority, reducing decision making layers, providing managerial autonomy and improving public managers accountability, introducing result based management system, focusing citizen centered service delivery, and developing financial based work culture. Therefore, I developed extreme interest to examine the major constrains for the application of NPFM based reforms effectively in Pakistan. This field of research is an unexplored area in the country as one can hardly find empirical based study about government accounting in Pakistan (Ashraf & Ghani, 2005).

This research study will be financed by Higher Education Commission (HEC) Government of Pakistan. Therefore, I will present this research to the Parliament. Parliament is the supreme law-making body of Pakistan. Among other functions, Parliament and Parliamentary Committees review and scrutinize reform-related policies of the government. They also examine the internal reform process in view with the contemporary trends of public sector reform in the world. In this connection, the role of the Parliament Secretariat is to provide information to the Parliamentary Committees in their process of examining reform policies. Therefore, newly acquired knowledge upon completion of this proposed research study will be an added asset to the Parliament Secretariat for discharging its institutional responsibilities.


8.1 Research Paradigm

A paradigm provides a conceptual framework for seeing and making sense of the social world. Cohen & Manion (1994) define the term paradigm as the philosophical intent or motivation for undertaking a study. The common theoretical paradigms discussed in literature are positivist, interpretivist, and pragmatic paradigms.

The philosophy of positivism is based on the assumption that there are universal laws that govern social events, and uncovering these laws enables researchers to describe, predict, and control social phenomena (Wardlow, 1989). Interpretive research, in contrast, seeks to understand values, beliefs, and meanings of social phenomena. Interpretivist approaches to research suggest that "reality is socially constructed" (Mertens, 2005, p.12). The interpretivist researcher tends to rely upon the "participants' views of the situation being studied" (Creswell, 2003, p.8).

Pragmatism does not show loyalty to any one system of philosophy or reality. It is seen as the paradigm that provides the underlying philosophical framework for mixed-methods research (Somekh & Lewin, 2005). The pragmatic paradigm's main emphasis is on understanding the research problem through application of possible approaches (Creswell, 2003, p.11).

The research design and methodological approaches to the present study will be predominantly embedded in the philosophical assumptions of the pragmatic paradigm.

8.2 Research Design

According to Creswell (2003), research designs fall into three categories - Quantitative, Qualitative and Mixed Methods. Qualitative research places emphasis on understanding through looking closely at people's words, actions and records. It examines the patterns of meaning which emerge from the data and these are often presented in the participants' own words. Quantitative research on the other hand uses standardized measures. It tends to be based on numerical measurements of specific aspects of phenomenon; it seeks measurements and analyses that are easily replicable by other researchers. Both the qualitative and quantitative methods have its advantages and disadvantages. Mix Method Approach overcomes the disadvantages of Qualitative and Quantitative methods and benefits from the advantages of each. The present study will adapt a combination of quantitative and qualitative methods in order to derive the advantages of both the approaches while minimizing the limitations of any single approach. However, the primary data for the study will be obtained through surveys and will be supplemented with interviews of a cross-section of selected respondents.

Rational for the Mixed Methods Approach: One of the most important principles of mixing methods is to clearly differentiate the purposes for mixing qualitative and quantitative methods (Greene et al., 1989). The first of the following two purposes enunciated by Green et al. (1989, p. 259) guides the selection of mixed methods approach for this research:

1. Complementarity seeks elaboration, enhancement, illustration, clarification of the results from one method with the results from the other method. To increase the interpretability, meaningfulness, and validity of constructs and inquiry results by both capitalizing on inherent method strengths and counteracting inherent biases in methods and other resources.

2. Development seeks to use the results from one method to help develop or inform the other method, where development is broadly construed to include sampling and implementation, as well as measurement decisions. To increase the validity of constructs and inquiry results by capitalizing on inherent method strengths.

The researcher believes in the need to select those research strategies which are most effective in probing and hence understanding the key issues in question (Guba, 1990). Certainly good research practice necessitates the researcher to attempt some measure of triangulation (i.e. to use multiple methods and data sources) in order to enhance the validity of any research findings (Mathison, 1988). Patton (1980) argues that triangulation can guard against the indictment that a study's findings are simply an artifact of single method, or single data sources, or a single investigator's bias. I will employ triangulation to compare the survey data with information obtained from interviews with subjects and in documents that will be reviewed.

Patton (1980) suggests that research designs allow for considerable mixing. Qualitative methods according to Patton, allow the researcher to capture the perspectives of the individuals who are studied. Marshal and Rossman (1989) also recommend the use of a flexible design that could allow for exploration of informal organizational processes as described from the subjects' frames of reference. In the proposed study, the interviews will allow for the openness to the unexpected and the exploration of shades of thinking in the subjects' discussion of their work. Interviews will be conducted to provide depth and detail through direct quotation and careful description, which Patton (1980) views as one of the essential tools for the researchers. Marshal and Rossman (1989) support the use of qualitative methods which depend on the "context, setting and subjects' frame of reference" (p.46). In this study about New Public Financial Management transfer, what are the factors involved in the transfer of policy and Does context matter to the application of accounting practices? will be reported through face to face interviews. By combining the interview approach, I will be able to garner more data with greater clarity than by using a survey alone. The transferability of NFPM and the ideas for reforming the government accounting is an empirical enquiry in the Pakistani context. The sources of information in this study will be based on both primary and secondary data.

8.2.1 Primary Sources of Data

The primary data will be collected through survey questionnaires, interviews, observation, and interactions. A series of questionnaires on accounting reforms will be distributed to the people who are involved in the reform process in Pakistan. Senior and junior level bureaucrats at the different ministries will be the target group for the questionnaires. Questionnaires will also be distributed to the professional organizations such as the Establishment Division; Public Administration Research Center; Civil Service Reforms Unit (SCRU); Securities and Exchange Commission of Pakistan (SECP); National Reconstruction Bureau (NRB); Planning Division; Institute of Charted Accountant of Pakistan (ICAP); Institute of Cost and Management Accountants of Pakistan (ICMAP); Audit General of Pakistan; Controller General of Accounts; and Ministry of Finance of Pakistan. In-depth interviews will be held with the Members of Parliament and Cabinet Committee on Administrative Reforms that is responsible for scrutinizing reform programs and the policies of the Government. Similarly, interviews will also be held with the then members and staff of Parliamentary Public Account Committees. Interactions will be held with the officials at the Ministry of General Administration. These interactive and participant-observation methods will also be a source of primary information in this research work.

8.2.2 Secondary Sources of Data

Secondary data would be based on the reform documents, their evaluation documents and other independent research documents on financial and other administrative reforms. The textual secondary data would be based on the reform documents-Administrative Reform Commission, Governance Reforms Programs, the project for Improvement in Financial Reporting and Auditing (PIFRA) and their evaluation documents and other independent research documents on financial reforms. The report of the PIFRA and policy documents of SECP and ICAP and ICMAP are the major policy documents of the government from where I would collect information on the contents, processes and the background of reforms. Similarly, I would also collect the secondary information on NPM based reforms from Civil Service Act and Rules, Good Governance Act, Local Governance ordinance 2000 which is presently under amendment in Parliament, and Local Administration Act. Reports of the Parliamentary Public Account Committee would be another main source of secondary information. Review of the evaluation documents of the government on reform activities would provide information to assess implementation status of proposed reforms and their achievements. Evaluation documents made by non-governmental organizations (NGOs), independent researchers, academics, and professional organizations may also give an opportunity to make cross evaluation of the reform programs. Publications of professional organizations such as Center for Administration and Management Development, Public Administration Research Center of Pakistan, Management Association of Pakistan, Administrative Staff College and National Documentation Center (NDC) would also be important secondary data to the study. Likewise, reforms assessment reports made by the donor agencies such as the World Bank and the Asian Development Bank (ADB) and IMF may also be valuable documents for the secondary data in analyzing NPFM and accounting reform phenomena in Pakistan.


According to Marshal and Rosseman (1989), the data analysis is the process of bringing order, structure and meaning to the mass of collected data by the researcher. The authors further suggest that the data analysis involve the processes of data organization, theme development and testing and report writing.

The data from the survey results will be tabulated and analyzed using both descriptive and bivariate statistics, including frequency distributions and cross tabs analysis. T tests will be used to test the hypothesis and its relationship with the transferability of accounting reforns (dependent variable). Pearson correlation coefficient will be used to quantify the strength of the relationship between independent and dependent variables.

Creswell (2003) noted that there is no single way of analyzing data and that analysis is an eclectic process which attempts to make sense of data. In analyzing the qualitative data, the data will be sorted and reduced into categories, identifiable patterns and themes. The interview information will be analyzed to clarify ideas and to discover and monitor the occurrence of concepts. For interviews, the ideas will be grouped and concepts will be categorized according to the independent variables.


Consistent with protocols of the human research ethics committee and accepted business research practices (Zikmund 1997; Cavana et al. 2001), steps will be taken to manage several ethical considerations in the proposed research project. Consent of respondents will be obtained for their participation in the study and care will be taken to ensure the anonymity of the study participants while analyzing and reporting data. The respondents will not be tempted to mislead them about the true nature of the inquiry during or before the data collection process.

While reviewing the literature, an unbiased attitude will be adopted. The research works reviewed and consulted will be acknowledged through crediting them with references. All critiques will be objective and within the ethical boundaries of the social science research. The proposed research will be accessible for use to all those who can value it. The researcher will follow the terms and conditions agreed between the scholar and the funding agency. The researcher will also execute the rules and regulations of the Bodø Graduate School of Business, which I am expected to do by virtue of my being a doctoral candidate.


The doctoral thesis will be composed of a collection of four essays. The preference of the article based thesis over a monograph is exploratory and descriptive tendency of the study and choice of the mixed method approach to be employed in the proposed investigation. My understanding is that the findings of the investigation can be presented in a better way and the researcher can come up with a better critique of the theory in an essay based thesis than in a monograph. The other reasons of my inclination towards an article based thesis are as under:

1. I have already undertaken an empirical study in my masters' program and have written a detailed thesis (finalized in June 2009). I want to switch to the article based research in PhD to prepare myself for this mode of research, which I have to master as a future researcher.

2. This mode of doctoral research will afford me ample opportunities to co-author research papers with professors and peers of the same school and that of other Norwegian and transnational institutes.

3. An article oriented doctoral research will offer me good future prospects than a monograph when I will look for job.

4. Through this mode of research, I will be able to instantly contribute to the existing body of knowledge.


The proposed research will proceed in three steps, each including literature study, data collection and preparation of publishable papers. The research design will be completed by August 2010 before leaving for the field study. Planned doctoral courses will be taken in 2010 as per availability (in this semester one course March and one in August). Working on preparation of publishable essays will start in September 2010 and will continue until August 2012. A tentative plan of the research activities under the proposed doctoral project is presented in table 1.


Higher Education Commission, Government of Pakistan, will sponsor this doctoral study. The scholarship package includes a monthly subsistence allowance amounting to NOK 8600, a research fund equivalent to 6000 euro per annum and a conference allowance, which comes to the tune of 300 euro per year. The applicant is an awardee of the Masters leading to PhD scheme of this scholarship. The scholarship is good for a period of five years. Two years of scholarship were meant for Master's Program and three years are allocated for undertaking doctoral studies. This research is extendable based on the recommendations of the academic advisor. The scholar will receive the subsistence allowance while research fund and conference allowance will be remitted to the host institution through Norwegian Center for International Cooperation in Higher Education (SIU).