In line with international trends, there have been several changes in governmental accounting and auditing practices in Pakistan since the early 2000s. Most of these changes or “reforms” have been triggered and sponsored by international agencies. These include World Bank sponsored Project to Improve Financial Reporting and Auditing’ (PIFRA), Department for International Development (DFID) sponsored Medium Term Budgeting Framework as well as several other changes in the Auditor and Accountant General of Pakistan’ offices. As a result, in many cases, there has been a partial implementation of these reforms. Although, there might be some genuine reasons for ‘modifications’ of these Western reforms to make them in line with the local needs. Either way, an in-depth understanding of local accounting and auditing practices and their comparison with Western ‘ideals’ is important for understanding the historical pathways the reforms took and the way forward. This project was thus aimed at understanding the local governmental accounting and auditing practices; their comparison with Western standards; and to explain the ‘gap’ through an indepth analysis of political, social and technical reasons. The research was of theoretical and policy significance.