Japanese Culture and Accounting

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Japanese Culture and Accounting

This paper explores several different writing on Japan's history, cultural heritage, economics, accounting, and taxation issues. There are several questions that are answered in this paper and they include: what is the country's primary source of GAAP; differences between Japanese and U.S. accounting; the country's attitude on corporate financial disclosure; what social, employment, or environmental disclosures does Japan require; what is the status of the auditing profession in Japan; how are the auditors trained and regulated; and finally, are the financial reports translated into U.S. GAAP or IFRS. By the end of this paper the reader should acquire a greater knowledge of the Japanese culture, economics, and accounting issues.

A Brief History of Japan and its Cultural Heritage
In 1603, Japan began to see some stability. Before this time there was a period of constant civil warfare. The Tokugawa Shogunate (a military-led, dynastic government) ushered in this long period of relative political stability and isolation from foreign influence ("The World Fact Book," 2007). This policy enabled Japan to enjoy a flowering of its indigenous culture for more than two centuries. During this time Japan was able to duplicate and even improve on Western technology. This was especially seen in there armaments. In 1854, Japan opened its ports after signing the Treaty of Kanagawa with the US. This brought about intense modernization and industrialization. Japan became a regional powerhouse during the late 19th and early 20th centuries that was able to defeat both Russia and China. At one time they occupied Korea, Formosa (which is now Taiwan), and the southern Sakhalin Island. In 1937 Japan launched a full-scale invasion of China. Then in 1941 they attacked US forces pushed America to enter into World War II. It was also during this time that Japan occupied much of East and Southeast Asia. When Japan was defeated in World War II, they recovered to become an economic power and an ally of the US. The emperor of Japan still retains his throne as a symbol of national unity but there is elected politicians that hold actual decision-making power. During 1960s through the 1980s Japans economy had three decades of unprecedented growth, but in the 1990s they experienced a major slowdown. Despite this they remain a major economic power. More hardship came to Japan in March 2011 when they had their strongest-ever earthquake, and a tsunami to follow that. These two events devastated the northeast part of Honshu island, killing thousands and damaging several nuclear power plants. These catastrophes have put a hitch in the country's economy and its energy infrastructure. Japanese Culture

Japanese culture seems to show a hierarchy of loyalties going from family, to lord, to shogun(not mere passive devotion, but active service and performance). This shows a de-emphasis on individual achievement in their culture (Schooler, 1990). Everything that they do is done for the common greater good and not for one’s individual needs. Appearance also appears to be a very important part of their culture. This is shown by the importance that is placed on social ranking and status. An example of this is in the business field of Japan. They have a vertical ranking of employees that is mainly based on age and it determines how you are addressed. To further this, the inferior partner in a relationship, whether personal or business, must abate their own wants, opinions, and thoughts to that of the superior. This is done so the superior will not lose face or be humiliated. Japan's Natural Resources

Japan has very scarce amounts of mineral resources. These resources include copper, iron ore, lead, and zinc. They also lack natural resources that provide energy. This is the reason for them being...
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