Management accounting practices in selected Asian countries

Abstract

Traditional management accounting techniques such as standard costing and variance analysis, traditional budgeting and cost volume profit analysis are said to be less useful in the present manufacturing environment. To succeed in the present dynamic business environment, tools or strategies such as JIT, ABC, TQM, process re-engineering, life cycle assessment and target costing would greatly enhance the ability of corporations to meet global competition. Through a literature review, this study examines the extent to which traditional and contemporary management accounting tools are being used in four Asian countries: Singapore, Malaysia, China and India. Overall, the evidence reviewed suggests that the use of contemporary management accounting tools is lacking in the four countries. The use of traditional management accounting techniques remains strong. The paper concludes with various recommendations for future research, the most important of which is the need for future studies to be grounded in theory.

Contingency Factors of Management Accounting Practices in Thailand: A Selection Approach

“…The adoption rates of contemporary MAPs are disappointing while those of traditional MAPs remain high across different countries including U.K., U.S., Australia, New Zealand, and Asian countries (Adler, Everett & Waldron, 2000;Bright, Davies, Downes & Sweeting, 1992;Chenhall & LangfieldSmith, 1998;Drury, Braund, Osborne & Tayles, 1993;EI-Ebaishi, Karbhari & Naser, 2003;Guilding, Cravens & Tayles, 2000;Phadoongsitthi, 2003;Sulaiman, Ahmad & Alwi, 2004;Szendi & Elmore, 1993). Hence, it may be too early to conclude that traditional MAPs have completely lost their importance, and the adoption of contemporary MAPs may not guarantee the success of organizations.…”

An Exploratory Study of the Level of Sophistication of Management Accounting Practices in Jordan

“…Moreover, this model has been tested by two studies in management accounting to determine the level of sophistication of MAPs (Adelegan, 2000;Abdel-Kader & Luther, 2006). The majority of the studies in terms of MAPs have been carried out in manufacturing sectors, (Adelegan, 2000;Sulaiman, et al, 2004;Wu & Drury, 2007;Davila, Wouters, 2006). However, the financial sector and services firms in general didn't have great attention from researchers and studies in terms of MAPs which was observed through reviewing the literature regarding management accounting studies.…”

“…In less-developed countries, Lin and Yu (2002) argued that the application of management accounting remains unsatisfactory. Sulaiman, et al (2004) indicated the lack of exploratory studies in Asian countries, in addition the need for studies which examine specific factors as to why Asian countries are not adopting newly developed management accounting tools and what the obstacles are to implementing such techniques. In Egypt, as a developing country, a study carried out by Ismail (2007) examined the performance measurement practices within private sector companies in Egypt.…”

“…In addition, many studies indicated that there is a lack of studies which examine the MAPs within the financial sector as most of the studies investigate the MAPs within the industrial or manufacturing sector. Furthermore many researchers indicated the need for examining management accounting within the financial and services sector (Adelegan, 2000;Sulaiman, Ahmad et al, 2004;Wu & Drury, 2007;Davila & Wouters, 2006;Billings, Capie, 2004;Garg, et al, 2003;Gutierrez, et al, 2005). Consequently, the current research attempts to remedy this shortage and fill the gap in the management accounting literature and in Jordan as a developing country in particular.…”

“…There are a limited number of studies focusing on MAPs in developing countries (Adelegan, 2000;Sulaiman et al, 2004;Ismail, 2007;Triest, Elshahat, 2007;Kattan, et al, 2007;Billings, Capie, 2004). In addition, many studies indicated that there is a lack of studies which examine the MAPs within the financial sector as most of the studies investigate the MAPs within the industrial or manufacturing sector.…”