It’s Not Easy Being an Accountant in Poland (Applying U.S-Type Budgeting in a Different Country)

The late 1980s and early 1990s were a very significant time for Eastern Europe. Several national boundaries and political ideologies, as well as the names of a few countries, changed during this period. Poland, like its neighbors, experienced tremendous upheaval in its political and economic climate during this time. In 1989, Poland changed to a non-Communist government and a free market economy. Since the end of World War II in 1945, Poland had been a centrally planned economy with government-enforced economic rules based on Marxism-Leninism. A Polish accountant’s professional life during the 1945–1989 period was not very exciting. Most university-trained accountants worked in a state-owned enterprise, earning a reasonable salary. The work was not complicated, generally entailing only basic bookkeeping. Performing the accounting work essentially required simple mathematical operations.

In addition, the nature of Poland’s history since the fifteenth century had generally created disdain for business and profiteering in general. These traditions, coupled with the social environment engendered by a Marxist government, resulted in a serious lack of respect

(sometimes bordering on distrust) for accountants, economists, and business managers from 1945 to 1989.

The failure of the Communist system in 1989 was the beginning of a new career stage for most accountants in Poland. The accounting profession suddenly became prestigious. It also became very challenging. Past accounting knowledge and skills were simply inadequate for the new economic situation, particularly for accountants moving out of state-owned enterprises and into the private sector. Business terminology, performance measures, and goals changed. Before 1989, the Communist regime promoted a view that everything a “capitalist” did was wrong and everything a Communist did was right. After the change in the political system, a lot of people began to see things in an opposite way; they expected that life in a capitalist country would be completely just and everyone would be employed with plenty of money. Obviously, life in a capitalist country is not perfect. There are problems, including injustice and unemployment. Complicating this reality, many people also carried over into the 1990s some of the prevailing pre-1989 attitudes that accountants and for-profit businesses were not trustworthy. Today Poland is making steady progress, but the accounting profession continues to face a number of challenges as attitudes and business processes are still in transition.

Assume that you have just been transferred by your U.S.-based company to an accounting or management position in the company’s Poland division. Your assignment is to implement a traditional budgeting system (similar to the budget systems described in this chapter)

in a large-scale manufacturing plant. Based on your understanding of Polish history and attitudes, what specific challenges would you expect to encounter in this new assignment? Do you have any ideas on how to handle these challenges?

Source: Adapted from P. Stec, “Mr. Kowalski: A Man Against All Odds,” The Journal of Accounting Case Research 2(3), 1995, pp. 52–54. Permission to use has been granted by Captus Press, Inc. and the Accounting Education Resource Centre of The University of Lethbridge. [Journal Subscription: Captus Press Inc., York University Campus, 4700 Keele Street, North York, Ontario, M3J 1P3, by calling (416) 736-5537, or by fax at

(416) 736-5793, E-mail: info@captus.com, Internet: http://www.captus.com]