When the tail wags the dog? Digitalisation and corporate reporting

To facilitate digital corporate reporting and enable computers to ‘read’ accounting information, standard-setters must construct a taxonomy assign contextual ‘metadata’ that codifies disclosures arising from concepts, standards practices. But digitalisation poses problem for reporting. Within internationally accepted practice, ‘principles-based’ give companies significant discretion in deciding what they disclose how report accounts of their activity. How would the principles-based nature be influenced by construction seeks specify all disclosures? Drawing on literature examining constitutive potential classification formal representation, we use our case study project undertaken global standard-setter, IASB, understand intervenes standard-setting practice despite intentions standard-setters. Our results detail sought minimise impact modelling only explicitly required standards. We reveal circumstances led IASB change its design seeking capture not should reported (as prescribed extant standards) but also was being new called ‘Common Practices’). analyse process which international disclosure practices were judged ‘common’, demonstrate Practices’ perceived early users taxonomy. When interpreting IASB’s Common Practices (what is) as be), generates self-validating feedback loop can generate more homogenous push International Financial Reporting Standards beyond approach designed engender. Although became increasingly aware influence (machine-readable) ‘tail’ traditional (human-readable) ‘dog’, attempts take tighter control development strengthened user perceptions represented an authoritative view reported. both represents accounting, impacts key debates. As provide universal codification disclosures, it valorises comprehensive machine-friendly rules over principles, offer standardised comparability entity-specific communication. offers perspective relations between information representation intervention moves passive, ‘reactive’ conformance consider representations intervene those generating representation. In doing so, ‘non-passive’ conformance.