Certain political factors can influence accounting systems and practices. Gastil (1978) defined political rights as the right to play a part in determining the laws and the government of a community. And he developed seven levels of political rights index:
Level 1 states that almost everybody has both rights and opportunities to participate in the political process, to compete for political office, and to join freely formed political parties;
Level 2 states that the effectiveness of the open electoral processes is reduced by factors such as extreme poverty, a feudal social structure, violence, or agreements to limit opposition;
Level 3 states that the effectiveness of the open electoral processes is reduced by non-democratic procedures, such as coups;
Level 4 states that there is either a constitutional block to the full democratic significance of election or the power distribution is not affected by the elections;
Level 6 states that either there is no operational electoral system, or opposition candidates are not allowed to compete;
Level 7 states that some factors may be characterized as tyrannies with little legitimacy either in a national tradition or a modern ideology.
The political-structure index suggested by Gastil ranks countries into five types: (1) multiple-party systems, (2) dominant-party systems, (3) one-party systems, (4) military dictatorships, and (5) traditional monarchies. The higher the level of political freedom, the lower the rank of a country.
Another useful and sophisticated classification of political systems is provided by Edward Shils (1966). He presented five different types of political systems: political democracy, tutelary democracy, modernizing oligarchy, totalitarian oligarchy, and traditional oligarchy. The characteristics of these different types of political systems can be summarized in table 2-2.
Table 2-2: A Classification of political systems
Representative, elected. ”Parliament” is centre of partisan decision-making.
“Rubber-stamp” parliament or
none at all. But there is the
Is advisory or
Not needed, function performed as needed by executive
Shares power with the legislature.
modified by party ideology, opposition & electorate.
Personality-oriented. Greater preponderance of the executive.