Some accountants have said that the development and acceptance of generally accepted accounting principles (that is, standard setting) is undergoing a “politicization.” Some use the term “politicization” in a narrow sense to mean the influence by government agencies, particularly the securities commissions, on the development of generally accepted accounting principles. Others use it more broadly to mean the compromise that results when the bodies that are responsible for developing generally accepted accounting principles are pressured by interest groups (securities commissions, stock exchanges, businesses through their various organizations, financial analysts, bankers, lawyers, etc.).
(a) What are the arguments in favour of the politicization of accounting standard setting?
(b) What are the arguments against the politicization of accounting standard setting?