Broad Scope Management Accounting Systems Research Articles

The propensity of risk-taking and financial efficiency: Exploring the role of management accounting system: Evidence from the manufacturing sector

This study aimed to know the impact of management accounting systems on firm financial efficiency while considering the CEOs risk-taking propensity. The Data was collected with the help of a self-administered questionnaire-based survey from the manufacturing sector of India. Used purposive sampling technique to collect data from 338 respondents. Results have shown that the broad scope management accounting system and integrator’s impact is insignificant on firm financial efficiency. In contrast, the effects of timeline and aggregation are significant on firm financial efficiency. Simultaneously, the mediation of risk-taking propensity is significant in all the cases except for integrator and firm financial efficiency. The researcher has adopted the latest and useful tools and techniques for exploring the problem. This study is a valuable addition. It is practically inducing the higher management and CEOs to follow the high-risk and high return concept while implementing the organizations’ management accounting system. This study is also helpful for organisations that are willing to enhance financial efficiency by employing novel methods.

The joint effect of budgetary participation and broad‐scope management accounting systems on management performance

PurposeThe purpose of this paper is to examine the interaction effect of budgetary participation (BP) and broad‐scope management accounting systems (BMAS) on management performance (MP).Design/methodology/approachA survey questionnaire was administered to managers of listed electronics companies in Taiwan. A moderated multiple regression model containing a product term was used to examine the interaction effect among BMAS, BP, and MP.FindingsThe results show the presence of a non‐monotonic interaction relationship between BP and MP over the range of the extent of BMAS. These findings support the hypothesis that a high (low) perceived usefulness of BMAS information is correlated with MP in situations of high (low) BP.Originality/valueThe paper provides additional empirical evidence to make clear the nature of the interaction between BP and BMAS impacting MP. The empirical evidence presented in the paper reveals that BMAS plays an essential mediating role in the relationship between BP and MP. Firms implementing a BP system should pay particular attention to the fit collocation of both BMAS and BP.

CHANGES IN THE SCOPE OF MANAGEMENT ACCOUNTING SYSTEMS IN THE DYNAMIC ECONOMIC CONTEXT

While much has been written in recent decades about management accounting change in advanced economies, little is known how management accounting systems (MAS) may be designed and used in the dynamic environment. The aim of the paper is to provide evidences about the changes in the scope of MASs in the dynamic economic context on the example of Estonian companies. The empirical results of the paper were gathered through questionnaire survey carried out among the largest Estonian companies. The study highlights several interesting features of MAS scope and its changes during 2004-2007 based on the 65 company responses. Findings revealed that, the increasing use of externally and internally oriented non-financial performance measurement approaches characterise the shift towards more broad scope MASs in the companies studied. The shifts towards broader MAS scope place further demands on an company’s managers’ knowledge in dealing with the ever more complex information systems in organisations.DOI: http://dx.doi.org/10.5755/j01.em.17.2.2164

Broad scope management accounting system and managerial performance: The impact of role ambiguity and functional difference

The purpose of this study was to examine whether role ambiguity mediates the relationship between broad scope management accounting system (MAS) and managerial performance. Further, this study also examined whether functional difference of activities moderates the association between broad scope MAS and role ambiguity, and between role ambiguity and managerial performance. The research subjects were marketing managers, production managers, and their supervisors of publicly-listed electronics manufacturing companies in Taiwan. Datawere collected from a survey and analyzed using confirmatory factor analysis. The relations between research variables were examined using path analysis. Results indicated that broad scope MAS did not directly influence managerial performance but through mediation of role ambiguity. The full mediation of role ambiguity was particularly pronounced in a marketing-oriented context. Key words: Broad scope management accounting system (MAS), role ambiguity, managerial performance, functional difference.

Perceived environmental uncertainty, supply chain purchasing strategy, and use of MAS information

PurposeThe purpose of this paper is to investigate the relationship between perceived environmental uncertainty (PEU), supplier development (SUD) and the use of broad scope management accounting systems (MAS) information. In recent years, many companies have come to recognize the important role supply chain purchasing strategy plays in achieving competitive advantage. One of the key components of the supply chain purchasing strategy is supplier development. In addition, there have been calls for research into how changes in supply chain management affect the use of MAS.Design/methodology/approachAbout 78 managers from different organizations participated in this Finnish study. Using operations management and accounting literature, four hypotheses were proposed in the study. Data were collected from managers using a mail‐out questionnaire.FindingsThe results revealed that PEU is a determinant of SUD, which, in turn, is a determinant of the use of MAS. In other words, SUD plays a mediating role in the relationship between PEU and the use of broad scope MAS information.Research limitations/implicationsThis paper describes the responses from 78 managers in medium to large size manufacturing firms in North‐Western Finland and consequently a caveat about generalizability is appropriate notwithstanding the high‐global esteem of Finnish manufacturing.Practical implicationsThe competitive production environment that exists today has forced many firms into lean production. This paper suggests that under such conditions of uncertainty the incorporation of SUD data into the MAS may prove very salutary.Originality/valueThe findings of this paper should prove useful to firms entertaining an upgrade and broadening the scope of their MAS to include supply chain management information, particularly as it relates to supplier development.

The relationships among broad scope MAS, managerial control, performance, and job relevant information

PurposeThe purpose of this paper is to demonstrate that the decision facilitation and decision influencing roles for management information are concomitant in organizations, and therefore must be analysed concurrently.Design/methodology/approachA two‐stage regression procedure for testing the moderating and intervening relationships among the variables of interest was adopted. First, the interaction of individual level controls (administrative and professional) on broad scope management accounting system (MAS) was tested, then the intervening relationship between broad scope MAS, job‐relevant information (JRI), and performance was analysed.FindingsTests of the moderating relationship between the control environment, broad scope MAS, JRI, and performance revealed a significant interaction term for JRI, but not for performance.Research limitations/implicationsThe usual measurement and implementation errors associated with survey methodology attach to this study. Furthermore, the sample was not randomly selected, which undermines the external validity of the findings. External validity will be further compromised by the relatively small sample size. Hence, caution is recommended in generalising the results to a wider population.Practical implicationsThe study provides evidence on the relationship between broad scope MAS, individual level control mechanisms and the outcome variable of JRI.Originality/valueThe paper seeks to use a controlled setting, established measures, and methods of analysis to suggest that when existing theory explains the empirical relationship among the variables of interest in more than one way, it may be necessary to comprehensively examine the relationships theoretically and empirically at more than one level to enable a better explanation of the linkage between theory and the empirical tests.

Job‐Relevant Information and its Role with Task Uncertainty and Management Accounting Systems on Managerial Performance

This paper examines the effect of job‐relevant information on the relationship between management accounting systems (MAS) and task uncertainty affecting managerial performance. Data are obtained via survey questionnaire of a sample of 131 senior managers from manufacturing firms in Australia. The study finds a statistically significant three‐way interaction between the extent of use of broad scope MAS information, job‐relevant information and task uncertainty affecting managerial performance. More specifically, the results suggest that under low task uncertainty situations, the use of more broad scope MAS information, regardless of job‐relevant information, would potentially result in information overload, which is detrimental to managerial performance. On the other hand, the results suggest that under high task uncertainty situations, the use of more broad scope MAS information and high use of job‐relevant information for decision‐making leads to improved managerial performance.

Pengaruh Customization dan Interdependensi terhadap Karakteristik Informasi Sistem Akuntansi manajemen Broad Scope dan Aggregation

This study examined empirically whether the relation between customization and charateristic of management accounting systems specially broad scope and aggregation information is a direct one or whether the relation operates via interdependence. The purpose of this study is to reexamined the result of Bouwens (1998), Bouwens and Abernethy, (2000) study reveal there is no strong support for characteristic of broad scope management accounting systems and aggregation information for uncertainty in managerial decision making. This is different from earlier studies of Mia & Chenhall (1994), Abernethy & Guthrie (1994), Chong (1998). A theoretical framework is developed to study the effect of customization on the use charateristic of management accounting systems. This theory suggests that customization has a direct effect on the use charateristic of management accounting systems, but also that customization augments interdependence between departements which in turn effects charateristic of management accounting systems use. It is argued that the information required for decision making by managers in firms pursuing customization differs significantly from the requirements of managers in firms which produce primarily standardized products. Information requirements change not only in direct response to the pursuit of customization but also due to the increasing interdependence which occur between functional departements. Path analysis is used to test the model. This study reveals that customization not increases interdependence in functionally differentiated structures. Partial support is found for a direct relationship between customization and characteristic of management accounting systems broad scope use. The result of this study can confirmation study Bouwens (1998), Bouwens dan Abernethy (2000) but there is no support to aggregation information. The other support is also found for a direct relationship between interdependence and management accounting systems aggregation information and there is no support for broad scope information. Data analysis revelas support for relation direct customization in charateristic of management accounting systems of broad scope information but it is not to aggregation information. Indirect customization not influences characteristic manage ment accounting systems broad scope and aggregation information use via interdependence. The study of 126 production dan sales managers further revealed difference in management accounting systems use of customization and interdepedence.