This paper examines changes to the accounting system of the Spanish tobacco monopoly in 1887, following the decision by the state to lease the publicly owned and state-run monopoly to a privatesector
company. The switch to private-sector management generated
a fundamental change in the demands made of the accounting system.
As a result, double-entry bookkeeping and a new method of
calculating costs were implemented. The paper discusses the motives
behind the design of the new accounting system and its consequences
using the framework provided by agency theory. It highlights the
need to consider the role of the capital structure of the firm and the
state as explanatory factors for both the parameters and uses of cost
accounting information.Financial support from a DGCYT grant SEC2001-0890) is gratefully acknowledgedPublicad
