Accounting, economic development and financial reporting: the case of three pre-Civil War US railroads

This study examines three leading US railroads during the years before the Civil War. Although these were private corporations, various governments assisted the railroads. Governmental involvement in the construction of railroads can be justified from the importance that railroads played in economic development in the areas the tracks bisected, as well asjustified due to the importance of railroads in linking together a region and for the provision of basic transportation that was otherwise lacking. It was seen that the government investment would have a direct financial payoff, hence, justifiable as a good investment. This examination focuses on the support provided by the public sector and the railroads' actions that acknowledged this public support. Public assistance in financing fledgling railroads had direct impacts upon financial reporting and public disclosure. One of these impacts was that annual reporting, a model used by governments, was introduced to nineteenth century businesses by means of railroads, a quasi-public enterprise.