CRC-TRR 266/1: Accounting for Transparency

The Collaborative Research Centre/Transregio “Accounting for Transparency” explores how accounting influences transparency and how transparency affects society. Calls for increased transparency are pervasive, particularly after the recent series of financial crises. Many transparency-related regulations in the area of taxation as well as financial and managerial accounting significantly increased the reporting burden of firms. However, public trust in the business sector tends to be very low, particularly in Germany. The historical role of accounting is to aggregate firm-level information into quantitative data. These data are communicated to insiders and outsiders of the firm, who use it to levy taxes and to support investment as well as other economic decisions. The digital revolution has drastically changed the information environment: Information has become ubiquitous, is being generated by diverse senders and distributed via a variety of channels to heterogeneous receivers who process and analyse the data and base various decisions on it. It is unclear how the traditional methods of accounting, which focus on numbers, facts, and verified judgments, can continue to create transparency in this transformed landscape. The researchers of the TRR address this topic. They collect field data to analyse the perception, processing and handling of accounting information. They study how regulations, behaviour, and preferences of economic agents shape accounting information and its effects on the transparency of firms. One focus in this regard lies on the transparency of the business taxation system. Furthermore, they assess the consequences of transparency for firms, their stakeholders and the general public. The insights from these activities will allow a well-founded assessment of regulatory reforms in the area of business taxation and financial reporting. Thus, the TRR will contribute to evidence-based policy making and to establishing a transparent tax system. Consequently, the results of the TRR 266 will contribute not only to the academic debate but also to the transparency of the economic system.