Christine Duller

The changing role of management accounting in the transition from a family business to a non‐family business

Purpose – The purpose of the present paper is to investigate whether the transition from a family business to a non‐family business affects the institutionalisation of management accounting.Design/methodology/approach – This paper is based on an online survey among all large and medium‐sized Austrian firms. Univariate and multivariate statistical analyses were used to test the impact of the level of family influence on aspects of the institutionalisation of management accounting. Firm size is included as the main control variable.Findings – A lower level of influence from the controlling family was found to be correlated with the institutionalisation and intensification of management accounting in medium‐sized firms. For large firms, such a linear relationship could not be drawn. The level of education of management accountants was inversely correlated with the level of family influence in both large and medium‐sized firms.Research limitations/implications – Further research into the reasons, underlying d...

No Consensus in Sight: An Analysis of Ten Years of Family Business Definitions in Empirical Research Studies

Family business (FB) scholars often criticize the fact that FB research has not yet developed a commonly accepted definition of what constitutes an FB. At the same time, the literature lacks empirical evidence for this claim. Hence, we collected all empirical FB research articles published between 2002 and 2011 in the five leading FB research journals to examine the types of FB definitions used in the literature and to determine how their usage relates to bibliographical and methodological contextual factors. The resulting 238 articles were analyzed in terms of their underlying approaches to defining FBs. Our paper provides empirical support for the notion that FB research has not yet found a commonly accepted definition of FB. Most definitions can be classified as being rooted in the components-of-involvement approach (44% of all evaluated articles), in the essence approach (21%), or in a combination of the two (33%). We also find that the type of FB definition used in empirical research in our sample is significantly associated with the publication outlet, the continent of data collection, the number of authors and the stock market listing status of analyzed firms.

Family Influence and Management Accounting Usage – Findings from Germany and Austria

Although contingency-based research finds many factors that influence a firm’s management accounting (MA) system, despite the vast economic importance of family firms in most Western countries, researchers have not considered family influence as a contingency variable for MA systems. Using survey results from Germany and Austria, we explore the effect of the level of family influence on selected aspects of MA usage. We find that firms with higher levels of family influence use fewer strategic and operational MA instruments, formalize their strategic plans to a lesser extent, establish fewer discrete MA departments, and employ fewer management accountants with academic degrees.

INSTITUTIONALISATION OF MANAGEMENT ACCOUNTING IN FAMILY BUSINESSES — EMPIRICAL EVIDENCE FROM AUSTRIA AND GERMANY

This study investigates whether family businesses (FBs) differ from non-family businesses (NFBs) regarding the institutionalisation of management accounting. Furthermore, it analyses whether FB-specific contextual factors such as the existence of non-family management and the level of family influence affect the establishment of discrete management accounting departments. Six hypotheses are formulated and tested based on survey results from 479 firms from Austria and 418 firms from Germany. Our results indicate that FBs establish fewer management accounting departments than NFBs do and that the heads of management accounting in FBs are less likely to hold a university degree compared with their counterparts in NFBs. Moreover, within FBs, larger firm size and the existence of non-family management are positively correlated with the establishment of management accounting departments, where firm size acts as the strongest predictor. As firm type (FB vs. NFB) emerged as a significant contextual factor for the institutionalisation of management accounting, this factor should be included in future studies of the organisation and set-up of the corporate management accounting function. Moreover, deeper investigation into the drivers and outcomes of FB-specific management accounting institutionalisation is needed.

Bayesian model selection for logistic regression models with random intercept

Data, collected to model risk of an interesting event, often have a multilevel structure as patients are clustered within larger units, e.g. clinical centers. Risk of the event is usually modeled using a logistic regression model, with a random intercept to control for heterogeneity among clusters. Model specification requires to decide which regressors have a non-negligible effect, and hence, should be included in the final model and whether risk is actually heterogeneous among centers, i.e. whether the model should include a random intercept or not. In a Bayesian approach, these questions can be answered by combining variable selection with variance selection of the random intercept. Bayesian model selection is performed for a reparameterized version of the logistic random intercept model using spike and slab priors on the parameters subject to selection. Different specifications for these priors are compared on simulated data as well as on a data set where the goal is to identify risk factors for complications after endoscopic retrograde cholangiopancreatography (ERCP).

REPUTATION OF FAMILY FIRMS FROM A CUSTOMER PERSPECTIVE

ABSTRACT Family firms aim to build favorable reputation with their stakeholders. The identity of a family firm, which – to varying extents – is conditioned by the owner family, is the basis for the corporate image as perceived by external stakeholders and thus influences the firm’s reputation. Favorable reputation, in turn, stimu-lates purchase decisions and fosters customer loyalty and retention. Based on an experimental survey, this article examines the impact of family ownership on reputation and customer loyalty. The findings indi-cate that family firms are rated higher in terms of customer orientation, social and environmental respon-sibility and other reputation factors. In addition, customers rather tend to recommend businesses known to be family-owned. Keywords : reputation, image, family firm, customer-based reputation, customer loyalty 1. INTRODUCTION Family firms (FFs) are characterized by their long-term orientation (Miller and Le Breton-Miller, 2006), identification of the owning family with their firm (Deephouse and Jaskiewicz, 2013), and strong social ties towards customers, employees, and the community (Arregle et al., 2007; Zellweger et al., 2012). These particularities provide incentives to create a unique image and build a good reputation (Salvato and Melin, 2008; Zellweger et al., 2012). According to corporate identity theory, the family is part of the identity of the firm (Dyer and Whetten, 2006) which provides the basis of corporate image and reputation (Brown et al., 2006). For some FFs, family ownership is obviously visible to the public, especially when the family name is part of the firm’s name (Deephouse and Jaskiewicz, 2013). Other firms hide their family ownership in their communication with external stakeholders (Carrigan and Buckley, 2008; Zellweger et al., 2012). Good reputation has positive effects on the financial success of a company (Basco, 2014), facilitates business transactions (Moog, Mirabella and Schlepphorst, 2011) allows access to capital on better terms (Yang, 2010), and enables entry into social and professional networks (Sieger et al., 2011). Since FFs consider strong relationships important (Arregle et al., 2007), especially relationships with customers (Binz et al., 2013; Craig, Dibrell and Davis, 2008), building a good reputation seems crucial for such firms. However, studies have only occasionally addressed the image or reputation of FFs related to customer loyalty and retention (Binz et al., 2013; Orth and Green, 2009). Moreover, scientific insights into the image and reputation of FFs and their potential impacts on customer loyalty are still rare. The relationship be-tween image as a FF and reputation is also not yet clear. The purpose of this study is to examine whether it is advantageous in terms of reputation to reveal a firm’s family ownership to customers and to identify possible consequences for customer loyalty. Our research contributes to existing literature in two ways. First, by drawing on an experimental survey, we investigate the impact of the communication of family ownership on FF’s reputation with customers. Second, we explore the relationship of reputation to cus-tomer loyalty. This paper is structured as follows. In the next section, corporate image, reputation, and their relevance for FFs are discussed, and hypotheses are developed. Section 3 explains the research methodology. In section 4 the empirical results of the experiment are presented. A discussion of implica-tions, limitations, and future research concludes the paper.

The Chief Financial Officer's Role in Medium-Sized Firms: Exploratory Evidence from Germany

Research on the Chief Financial Officer’s (CFO) role has increased in the last few years, but has so far mainly focused on large firms and neglected the CFO’s role in smaller firms. Therefore, in this paper, we study whether the CFO’s role in medium-sized firms differs from the CFO’s role in large firms. Using a sample of 378 German firms, we investigate the effect of firm size on CFO characteristics, CFO responsibilities and the CFO’s participation in strategic planning. Our findings show that CFOs in medium-sized firms have less often obtained a university degree and less often take responsibility for various finance and accounting functions compared to large firms. We do not find a differing level of CFO participation in strategic planning in dependence of firm size, but we find that after the CEO, the CFO obtains a “number two” position in strategic planning regardless of firm size.

Correspondence Analysis‐Theory and Application in Management Accounting Research

Correspondence analysis is an explanatory data analytic technique and is used to identify systematic relations between categorical variables. It is related to principal component analysis and the results provide information on the structure of categorical variables similar to the results given by a principal component analysis in case of metric variables. Classical correspondence analysis is designed two‐dimensional, whereas multiple correspondence analysis is an extension to more than two variables.After an introductory overview of the idea and the implementation in standard software packages (PASW, SAS, R) an example in recent research is presented, which deals with strategic management accounting in family and non‐family enterprises in Austria, where 70% to 80% of all enterprises can be classified as family firms. Although there is a growing body of literature focusing on various management issues in family firms, so far the state of the art of strategic management accounting in family firms is an empi...

Chief financial officer (CFO) characteristics and ERP system adoption: An upper-echelons perspective

Purpose This paper aims to examine the relationship between characteristics of chief financial officers (CFOs) and enterprise resource planning (ERP) system adoption. Following upper echelons theory, the authors theorize that CFO age, education, tenure and recruitment influence ERP system adoption, and that this relationship is moderated by the CFO being responsible for firm-wide information technology (IT) functions. Design/methodology/approach The empirical analysis is based on a survey of 296 large and medium-sized Austrian firms. Logistic regression analyses were used to test the association between CFO characteristics and ERP system adoption. Findings The authors find that firms with externally recruited CFOs have adopted ERP systems significantly more often than firms with internally promoted CFOs. Surprisingly, the results indicate that firms with less educated CFOs more often adopted an ERP system, and that the relationship between CFO characteristics and ERP system adoption is not moderated by the CFO being responsible for IT. Research limitations/implications This paper adds to the literature by corroborating case-based evidence that CFOs and their characteristics influence ERP system adoption. Extending previous research which indicates that CFO characteristics influence accounting practices, the authors show that CFO characteristics also influence technological innovation such as the adoption of ERP systems. Future research on technological innovation may therefore pay closer attention to the influence of CFOs. Originality/value This paper is the first to quantitatively test the influence of CFO characteristics on ERP system adoption.

The Relationship between Corporate Governance Configuration in Family Businesses and the Use of Management Accounting

Extant research has shown that family businesses use less management accounting practices than non-family businesses. In our study, we extend the research in this field by analysing the effects of various corporate governance configurations in family businesses on the usage of management accounting. We find that the composition of the supervisory board (with or without family members) does not have a positive impact on management accounting usage, whereas the introduction of non-family members into the top management team partly does. Our findings suggest that the mere existence of corporate governance bodies such as the supervisory board in family businesses is positively associated with the use of management accounting. Our study also indicates that management accounting information may play a pivotal role in the communication between the top management team and the supervisory board of a family business.