An exploratory study of management accounting and control systems in a developing country

This thesis reports on the results of case studies in four commercial banks in Nigeria. The study focuses how management accounting and control systems (MCS) operate in the four banks. The study is motivated by the dearth of literature on management accounting practices in the developing world in general and in Nigeria in specific. The case study approach adopted in conducting the research was useful in exploring the dynamics of the MCS in the organisations. Data was gathered from two sources. First, semi-structured interviews were conducted with managers at the head office, regional office and branches of each bank. The participants were selected from different backgrounds and managerial levels to provide broader understanding of the operations of the MCS. Second, various internal and external documents were reviewed to provide supporting evidence for the interview results. New institutional sociology (NIS) provided the theoretical framework to understand the results. NIS provided explanations for how the MCS in the four banks were shaped by diverse external and internal factors. The key factors identified as shaping the operations of the MCS were the need to comply with the regulatory environment (coercive isomorphism), the need to maintain social and cultural support (normative isomorphism) and the need to imitate successful organisations in order to appear legitimate (mimetic isomorphism). The study also examines the interplay between the institutional forces, market forces and infra-organisational power relations. This analysis is necessary to overcome the criticism of NIS that it downplays the role of market forces, agency and intra-organisational relations. The findings of the study have implications for understanding the operations of MCS in the developing world.

An institutional perspective on management accounting change in the public sector : a case study from Canada

This thesis reports on a four-year field study conducted at the Saskatchewan regional office of the Department of Indian Affairs and Northern Development, a large department of the Government of Canada. Over the course of the study, a sweeping government-wide accounting reform took place entitled the Financial Information Strategy. An ethnographic study was conducted that documented the management accounting processes in place at the regional office prior to the Financial Information Strategy reform, the organization’s adoption of the new accounting system associated with this initiative, and the state of the organization’s management accounting system once the implementation was complete. This research, therefore, captures in detail a management accounting change process in a public sector organization. This study employs an interpretive perspective and draws on institution theory as a theoretical framework. The concept of loose coupling and insights from the literature on professions were also employed in the explanation-building process for the case. This research contributes to institution theory and the study of management accounting change by recognizing conflicting institutional forces at the organizational level. An existing Old Institutional Economics-based conceptual framework for management accounting change is advanced and improved upon through the development of a new conceptual framework that incorporates the influence of wider institutional forces, the concepts of open and closed organizational systems and loose coupling, and the recognition of varying rates of change and institutionalization of organizational activity sets. Our understanding of loose coupling is enhanced by the interpretation of institutional influences developed in this study as is the role of professionalization as a normative influence in public sector organizations.

Implementing aspects of management accounting in a low volume manufacturing engineering concern

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Practitioners are from Mars; academics are from Venus? An investigation of the research-practice gap in management accounting

Purpose: The aim of this paper is to identify and gain insights into the significance of barriers contributing to the purported "gap" between academic management accounting research and practice. Design/methodology/approach: Drawing on diffusion of innovations theory, this study collects and analyses data from a questionnaire survey and follow-up interviews with 19 representatives of the four principal professional accounting bodies in Australia. Findings: Professional accounting bodies perceive the gap between academic research and practice in management accounting to be of limited concern to practitioners. The two most significant barriers to research utilisation by practitioners are identified as: difficulties in understanding academic research papers; and limited access to research findings. In acting as a conduit between the worlds of academia and practice, professional bodies have an important role to play by demonstrating the mutual value to both academics and practitioners resulting from a closer engagement between MA research and practice. Research limitations/implications: As one of the few empirically-based, theoretically informed investigations exploring the research-practice gap in management accounting, this study provides insights rather than "answers". Its findings therefore serve as a foundational basis for further empirical and theoretical enquiry. Originality/value: This study contributes to the conversation about the "research-practice gap" in management accounting by adopting a distinct theoretical vantage point to organize, analyse and interpret empirical evidence obtained from Australian professional accounting bodies about management accounting practice. © Emerald Group Publishing Limited.

An investigation of management accounting control systems in the palm oil industry:a sociomaterial approach to practice change

The primary aim of this research is to understand what constitutes management accounting and control (MACs) practice and how these control processes are implicated in the day to day work practices and operations of the organisation. It also examines the changes that happen in MACs practices over time as multiple actors within organisational settings interact with each other. I adopt a distinctive practice theory approach (i.e. sociomateriality) and the concept of imbrication in this research to show that MACs practices emerge from the entanglement between human/social agency and material/technological agency within an organisation. Changes in the pattern of MACs practices happens in imbrication processes which are produced as the two agencies entangle. The theoretical approach employed in this research offers an interesting and valuable lens which seeks to reveal the depth of these interactions and uncover the way in which the social and material imbricate. The theoretical framework helps to reveal how these constructions impact on and produce modifications of MACs practices. The exploration of the control practices at different hierarchical levels (i.e. from the operational to middle management and senior level management) using the concept of imbrication process also maps the dynamic flow of controls from operational to top management and vice versa in the organisation. The empirical data which is the focus of this research has been gathered from a case study of an organisation involved in a large vertically integrated palm oil industry company in Malaysia specifically the refinery sector. The palm oil industry is a significant industry in Malaysia as it contributed an average of 4.5% of Malaysian Gross Domestic Product, over the period 1990 -2010. The Malaysian palm oil industry also has a significant presence in global food oil supply where it contributed 26% of the total oils and fats global trade in 2010. The case organisation is a significant contributor to the Malaysian palm oil industry. The research access has provided an interesting opportunity to explore the interactions between different groups of people and material/technology in a relatively heavy process food industry setting. My research examines how these interactions shape and are shaped by control practices in a dynamic cycle of imbrications over both short and medium time periods.

The adoption of value-based management in large UK companies:a case for diffusion theory

Purpose – In the 1990s, a growing number of companies adopted value-based management (VBM) techniques in the UK. The purpose of this paper is to explore the motivations for the adoption or non-adoption of VBM for managing a business. Design/methodology/approach – An interview-based study of 37 large UK companies. Insights from diffusion theory and institutional theory are utilised to theorise these motivations. Findings – It was found that the rate of adoption of VBM in the sample companies does follow the classical S-shape. It also suggests that the supply-side of the diffusion process, most notably the role played by consultants, was an influence on many companies. This was not, however, a sufficient condition for companies to adopt the technique. The research also finds evidence of relocation diffusion, as several adopters are influenced by new officers, for example chief executive officers and finance directors, importing VBM techniques that they have used in organizations within which they have previously worked. Research limitations/implications – It is quite a small scale study and further work would be needed to develop the findings. Practical implications – Understanding and theorising the adoption of new management techniques will help understand the management of a business. Originality/value – This research adds further evidence to the value of studying management accounting, and more specifically management accounting change, in practice. It shows the developments in the adoption of a new technique and hence how a technique becomes accepted in practice.

Accounting information systems as knowledge objects:some effects of objectualization

This paper will outline a research methodology informed by theorists who have contributed to actor network theory (ANT). Research informed from such a perspective recognizes the constitutive role of accounting systems in the achievement of broader social goals. Latour, Knoor Cetina and others argue that the bringing in of non-human actants, through the growth of technology and science, has added immeasurably to the complexity of modern society. The paper ‘sees’ accounting and accounting systems as being constituted by technological ‘black boxes’ and seeks to discuss two questions. One concerns the processes which surround the establishment of ‘facts’, i.e. how ‘black boxes’ are created or accepted (even if temporarily) within society. The second concerns the role of existing ‘black boxes’ within society and organizations. Accounting systems not only promote a particular view of the activities of an organization or a subunit, but in their very implementation and operation ‘mobilize’ other organizational members in a particular direction. The implications of such an interpretation are explored in this paper. Firstly through a discussion of some of the theoretic constructs that have been proposed to frame ANT research. Secondly an attempt is made to relate some of these ideas to aspects of the empirics in a qualitative case study. The case site is in the health sector and involves the implementation of a casemix accounting system. Evidence from the case research is used to exemplify aspects of the theoretical constructs.

Inscribing the organization:representations in dispute between accounting and production

This paper assumes that a primary function of management accounting is the representation of "accounting facts" for purposes such as organizational control. Accountants are able to offer conventional techniques of control, such as standard costing, as a consequence of their ability to deploy accounting representations within managerial and economic models of organizational processes. Accounting competes, at times, with other 'professional' groups, such as production planning or quality management people, in this role of representing the organization to management. The paper develops its arguments around a case illustration of cost accounting set in a low technology manufacturing environment. The research relates to a case organization in which accountants are attempting to establish the reliability of accounting inscriptions of a simple manufacturing process. The case research focuses on the documents, the inscriptions that vie for managements' attention. It is these sometimes messy and inaccurate representations which enable control of complex and heterogeneous activities at a distance. At the end of our site visits we observe quality management systems in the ascendancy over the accountants' standard costing systems. © 2006 Elsevier Ltd. All rights reserved.

The effects of perceived business uncertainty, external consultants and risk management on organisational outcomes

Purpose: The purpose of this paper is to investigate the relations between perceived business uncertainty (PBU), use of external risk management (RM) consultants, formalisation of RM, magnitude of RM methods and perceived organisational outcomes. Design/methodology/approach: This paper is based on a questionnaire survey of members of the Chartered Institute of Management Accountants in the UK. Using AMOS 17.0, the paper tests the strength of the direct and indirect effects among the variables and explores the fit of the overall path model. Findings: The results indicate significant and positive associations exist between the extent of PBU and the level ofRMformalisation, as well as between the level ofRMformalisation and the magnitude of RMmethods adopted. The use of externalRMconsultants is also found to have a significant and positive impact on the magnitude of RM methods adopted. Finally, both the extent of RM formalisation and the magnitude of RM methods adopted are seen to be significantly associated with overall improvement in organisational outcomes. Research limitations/implications: The study uses perceptual measures of the level of business uncertainty, usage of RM and organisational outcomes. Further, the respondents are members of a management accounting professional body and the views of other managers, such as risk managers, who are also important to the governance process are not incorporated. Originality/value: This study provides empirical evidence on the impact ofRMdesign and usage on improvements in organisational outcomes. It contributes to the RM literature where empirical research is needed in order to be comparable with the traditional management control system literature.

Author-itative interpretation in understanding accounting practice through case research

The way interviews are used in accounting research, and the way this research is written up, suggests that there is only one way to interpret these interviews. This invests the author(s) with great perceptive power and storytelling ability. What if different assumptions are used about how to interpret research, and how to present the ensuing findings? We give an illustration of what this might imply, using the notion of 'reflexivity'. The setting for our illustration concerns a series of interviews with management accountants on the dilemmas they face in their daily work. We apply Alvesson's ideas on how to use metaphors to open up the interpretation of interview accounts. The aim of the paper is to shed a different light on the way interviews can be used and interpreted in accounting research. We assert that allowing for reflexive accounts is likely to require substantially differently written research papers, in which the process of discovery is emphasized. © 2011 Elsevier Ltd.

A contingency theory perspective on the risk management control system within Birmingham City Council

In recent years the topic of risk management has moved up the agenda of both government and industry, and private sector initiatives to improve risk and internal control systems have been mirrored by similar promptings for change in the public sector. Both regulators and practitioners now view risk management as an integral part of the process of corporate governance, and an aid to the achievement of strategic objectives. The paper uses case study material on the risk management control system at Birmingham City Council to extend existing theory by developing a contingency theory for the public sector. The case demonstrates that whilst the structure of the control system fits a generic model, the operational details indicate that controls are contingent upon three core variables—central government policies, information and communication technology and organisational size. All three contingent variables are suitable for testing the theory across the broader public sector arena.