Degree Name

Doctor of Philosophy


School of Accounting and Finance - Faculty of Commerce


The study of accounting in its environmental contexts requires an understanding of accounting beyond its technical and numerical aspects. To obtain social, cultural and political legitimacy, organizations tend to adopt formal structures and practices � including accounting � that have been widely accepted by society as social norms and values without necessarily using them in actual practices. Seen from this perspective, accounting information, and particularly budgeting that plays an important role in organizational control systems, is not value free. It intermingles and is implicated in constructing social reality by shaping and being shaped by the political interplay among contested interested parties that takes place in organizations. This study examines the impact of the institutionalization of the authoritarian-bureaucratic regime of the New Order government of Indonesia in the PBS Jakarta � a private higher education institution � on the role of accounting and budgeting used within the organization. Incorporating the theory of closure of Weber and power mobilization developed by Hardy (1996) into institutional theory, a theoretical research framework is developed to reflect the researcher�s understanding regarding the research process as a result of his experience in interacting with the subject being studied for more than a decade � as an academic as well as an administrative staff member. Following an ethnographic case study method that allows the involvement of the researcher as a part of the case being studied, the subjective experience of the researcher enriches the analysis of this study � reflexive-ethnography. An historical analysis is performed by involving a confirmation by the researcher of other organizational participants� understanding about the school�s control system through interviews � inter-subjective analysis. Documents and archival records are also used in order to provide official organizational and descriptive historical contexts of the case and to make available the powerful link between what people say-interviews-and what they actually do. Instead of formal organizational structures being adopted, this study found that informal relationships, paternalistic management and physical control dominated everyday managerial practices in which the school head held the absolute power in the school. Budgeting as part of formal control systems, in this environment, facilitated a political deal among the school�s stakeholders and functioned as a rationalized myth to the process-not an efficiency measurement. In addition, financial statements played a symbolic reason to display how the managerial conduct was rational and financially responsible. An effort to implement a technical-rational efficiency discourse of budgeting into the school by the new school head, after the demise of the New Order government, turned out to be a devastating blow to the school development as it contradicted the organizational culture that existed in the school. Therefore, these findings contribute to the understanding of accounting as providing socially constructed meanings and reality-accounting is value-laden.



Unless otherwise indicated, the views expressed in this thesis are those of the author and do not necessarily represent the views of the University of Wollongong.