ACCOUNTING PROBLEMS OF CARTELS.
The term "cartel" is used here to include all kinds of horizontal associations of independent firms with the purpose of influencing market conditions through common action. As long as cartels limit their activities to term-fixing or price-fixing they do not have any accounting problems of their own. The situation is different when they begin to regulate production or sales directly. Although the law does not permit such organizations in the U.S., shortage of materials and the need for allocating their use create problems which in some respect resemble those confronting cartels. A discussion of some cartel accounting questions may, therefore, have more than academic interest. The cartels under consideration may be conveniently grouped into those which merely fix output or sales of their individual members, and those which in addition act as central distributing or selling agencies. For all of them a threefold task in involved, first, to determine the relative participation of the individual member, the quota; second, to decide upon the total volume to be produced within a given period; third, to control production or sales of the members, to take care of deviations from the scheduled volume, and, for syndicates, to distribute the collected receipts among the partners. It is particularly this last function which calls for an elaborate cartel accounting system. Estimates of future demand based on present market conditions and businessmen's experience are the main factors involved.
- DOI
- 10.2308/tar-7042118
- Volume
- 18 (3)
- Pages
- 249-256
- Language
- en
- Export
- BibTeX
- Sources
- crossref openalex