The interplay between law and accounting in the conceptualization of depreciation in Spain (1885-1939)

This research studies the emergence of the concept of depreciation in Spain up to 1939, identifying the interplay between law and accounting. We focus our analysis on the hypotheses of both Watts and Zimmermann (1979) and of Napier and Noke (1992). Our intention is to fulfil this dual task of retrieval and reinterpretation of the origins of depreciation in Spain, in order to analyse the concerns over the importance of implementing depreciation policies and the role played by accounting thinkers and legal regulations in the adoption of Spanish accounting depreciation. We find no evidence for the market-forexcuses hypothesis and, in contrast to the conclusions of Watts and Zimmermann (1979), it seems that the change in accounting theory appeared before rather than after changes to the law. This interplay fits with Napier and Noke's hypothesis of a multidirectional process in which each discipline affects and influences the other.