Chee W. Chow

Strategy, IT applications for planning and control, and firm performance: The impact of impediments to IT implementation

Our study examined the association among strategy, the extent of IT applications to 12 planning and control functions, and firm performance. Special attention was paid to the moderating effect on these relationships of 15 technical, human, and organizational impediments to IT implementation. We analyzed survey data obtained from 296 Taiwanese companies, supplemented by financial data from publicly disclosed financial reports. Results indicated that strategy significantly influenced the extent of IT applications for planning and control. In turn, the extent of IT applications had a significant direct effect on firm performance, while the direct effect of strategy was insignificant. The relationship between strategy and the extent of IT applications, and between the latter and firm performance were both stronger when the level of impediments to IT implementation was low. The findings went beyond these general relationships to reveal systematic differences in the specific IT applications and impediments of firms pursuing different strategies.

Management accounting practices in the People's Republic of China

Abstract This chapter surveys the current management accounting and control practices by Chinese companies and factors that affect their adoption. This discussion is placed in the historical context of management accounting practices in China. The Chinese governments open door policy and economic reform beginning in 1978 ushered in a period of increasing receptivity to modern management accounting applications. Since 1997, the pace of application has accelerated because of increased marketization and privatization. As a result, current management accounting practices, as reported by our sample of listed companies and a number of other recent surveys, have at best reached the third stage defined by the International Federation of Accountants (1998), though there are some fourth stage applications. Marketization and privatization, together with Chinas accession to the World Trade Organization, information technology, accounting education, and research, will continue to drive future development of management accounting in China

Is Environmental Uncertainty an antecedent or moderating variable in the design of budgeting systems? An exploratory study

Environmental Uncertainty (EU) has been engaged in budgeting studies both as an antecedent and a moderating variable. Since these treatments have very different implications for theory development and understanding of phenomena, this study empirically explores their relative validity. Using data collected from managers of 440 publicly held Taiwanese companies, the results of path analysis and moderated regression support the view that EU is an antecedent to features of budgeting systems which in turn significantly affect firm performance. The results also reveal a (spurious) significant moderating effect of EU on the relationship between features of the budgeting system and firm performance.

Connotative meaning and the challenges of international financial reporting/auditing standards convergence: the case of Taiwan's Statement of Auditing Standards Number 33

Translating international standards into local languages is a big obstacle to the global convergence of financial reporting and auditing practices. This study uses Taiwan’s promulgation of Statements on Auditing Standards No. 33 to examine an important component of this challenge: the need for local standard setters to anticipate how domestic constituents would interpret local words used to translate original English terms. Data collected from samples of Taiwanese auditors, public prosecutors, and investors revealed that as compared to the auditors, financial statement users ascribe different connotative meanings to a Chinese term that was originally proposed, and one that was chosen as its replacement after objections from the accounting profession. Further, the words’ connotative meanings significantly mediated the link between the local term and financial statement users’ judgments about auditor legal liability. Significantly, the connotative meaning that financial statement users ascribed to the replacement term was associated with a higher level of ascribed auditor liability, such that in successfully pushing for a wording change, members of Taiwan’s accounting profession may have increased, rather than reduced, their exposure to liability from audited financial statements. These findings have a number of implications for standard setters, the standard setting process, and accounting firms.

World-class manufacturing, management accountants’ cross-functional participation, and firm performance

This study examines whether management accountants’ extent of cross-functional participation increases with their firms’ world-class manufacturing (WCM) implementation and how such participation affects financial and nonfinancial firm performance. Results from applying structural equations modeling (SEM) to archival and survey data from 209 listed firms in Taiwan indicate that management accountants’ cross-functional participation increases with their firms’ use of WCM, and that both WCM and management accountants’ cross-functional participation have positive links to firm performance, with the latter also partially mediating WCM’s performance effect. These results suggest that management accountants are responsive to the demands of their firms’ manufacturing practices and that this participation not only helps to enhance the benefits of WCM, but also firm performance in other ways.

On why and how to break down the silos in accounting research (with an illustrative study at the interface between financial and management accounting)

This paper shares some thoughts on why and how to break down the artificial barriers that exist in accounting research. Through a discussion of the research-practice-teaching triangle in accounting, three major ways are suggested for accomplishing this objective. These are, respectively, expanding the diversity of theories and methods, and adopting a more holistic approach to viewing accounting phenomena. We particularly illustrate the last approach by presenting a framework for placing accounting issues in a broader context, and reporting on a study that emerges from applying this framework.