Falconer Mitchell

The process of change in management accounting: some field study evidence

The process by which management accounting has changed within firms has received little attention by researchers. This paper is based upon seven field studies of practical managerial accounting change in the electronics sector. The primary aim is to investigate the factors which have influenced management accounting change in these firms. In addition an analysis is provided of how these factors combine and interact to provide the ‘real world’ circumstances which result in practical developments occurring in management accounting. It is proposed that at least three sets of factors namely motivators, facilitators and catalysts are involved in the process of change in management accounting.

The development of activity-based costing journal literature, 1987-2000

This paper contains an analysis of the activity-based costing (ABC) literature which has been accumulated in the UK and USA accounting journals over the fourteen-year period since the first articles on ABC emerged. This evidence is used both longitudinally and cross-sectionally to gain insights into how ABC started, how it has been communicated, how it has been researched, how it is constituted, how it has generated attention and how it has developed and changed. From the analysis conclusions are drawn on these issues and on the role of academic research when confronted by a new practical innovation of this type.

Research and practice in management accounting: improving integration and communication

This paper explores the relationship between research and practice in management accounting. It reviews the causes of a gap in communication between the researcher and practitioner constituencies and makes some proposals on how closure of this gap might be commenced.

Venture Capital Supply and Accounting Information System Development

One of the most important events in the early life-cycle of any entrepreneurial firm that harbors serious growth ambitions is the Infusion of external capital (Reid, 1996). This event can lead to significant changes in the firms ownership composition. It affects its subsequent rate of growth and, consequently, its size and organizational structure. It is within the context of such changes that the managerial demand for information about the firm is stimulated. This study examines the origins and characteristics of developments in the accounting information systems (AIS) of firms that are going through this stage. It does so by investigating the consequences of venture capital1 intervention for the entrepreneurial firm, particularly as regards the characteristics of its accounting information system.

Towards a paradigmatic foundation for accounting practice

Purpose - The purpose of this paper is to propose a framework (pragmatic constructivism) for a new paradigm for accounting practice. The paradigmatic base of practice is an important element in explaining, understanding, justifying and defending practice. Design/methodology/approach - The paper is designed to argue the case for the use of pragmatic constructivism as a basis for the development of a paradigmatic foundation of accounting practice. To achieve this, pragmatic constructivism is explained and its application to accounting is illustrated and contrasted with the traditional paradigm of realism. Findings - The analysis shows how the use of a less reductionist paradigm than realism can assist accountants both in the creation of a rationale and a defence for practice. Research limitations/implications - The analysis is exploratory in the sense that a new paradigmatic framework is outlined and used to illustrate its potential to develop a paradigm for practice. The creation of a full practice paradigm for accounting is beyond the scope of one paper. Hence this analysis should be viewed as only a first step towards developing a paradigm of accounting practice. Originality/value - The proposal of pragmatic constructivism for this purpose is novel to the accounting literature. The value of its application lies in its potential to explain and defend accounting practice.

High school accounting and student performance in the first level university accounting course: A UK study

Abstract This article contains the results of a UK study on the effect of high school accounting on student performance in a first level university accounting course. In addition to replicating previous research, it extends the scope of previous work by examining a wider range of assessments and also investigates the question of numerical ability as an additional differentiating factor in student performance.

Applying functional cost analysis in a manufacturing environment

Abstract Value engineering is a technique initially developed in the West and widely employed by engineers to enhance product design. It has been further developed largely through the involvement, in Japan, of cost engineers. Most large Japanese manufacturers use it as an important element in their cost reduction and cost management policies. They employ it as a team activity to encourage the interaction and contribution of a range of disciplines. Accountants participate in these teams and provide a major input to the functional analysis of value engineering, and this has been termed “functional cost analysis” by the authors. This paper explores the nature and impact of functional cost analysis as it is used in value engineering. The first half of the paper is concerned with the more conventional application of functional cost analysis to individual products. This illustrates how and why the functions rather than the parts or resource inputs to a product can provide a valuable focus for costing activity. Functional cost analysis is examined within the context of different stages in the product life cycle and the application of cost management policies including competitive analysis, benchmarking and target costing. The second half of the paper examines an extension of the functional cost analysis approach from products to areas of manufacturing overhead costs and this includes drawing upon activity-based costing information. This involves the application of functional cost analysis methodology to business processes such as procurement, ordering, quality control and production scheduling. These are analysed and costed in terms of the functional service required by the “customers” of each business process. It thus provides a structured way of bringing visibility to many overhead areas in a manner which facilitates not only cost reduction but also incremental investment. Functional cost analysis allows cost information to be presented in a way which can reflect not only the technical capabilities of the firm but also the viewpoint of its customers. It also draws on the range of skills possessed by a variety of staff which can contribute to the cost management effort. These strengths have resulted in functional cost analysis becoming a highly effective and widely used technique for cost management.

Propaganda, Attitude Change and Uniform Costing in the British Printing Industry, 1913-1939

Analyses the attempt by a trade association (the British Federation of Master Printers) to secure the universal adoption by its members of a uniform costing system. It was envisaged that the industry‐wide application of a prescribed costing solution would secure the socio‐economic advancement of employer printers and ensure an improvement in their power relative to unionized labour and unorganized customers. Universal adherence to the uniform costing system depended on the trade association changing the prevailing negative attitudes of employers towards the twin ideals of scientific costing and organization. In order to achieve this a concerted campaign of persuasive communication was undertaken. Reveals that propaganda was conducted by utilizing a variety of distribution media and by employing a range of propagandist devices. The limited success achieved in converting employers to the costing cause is considered to have been the result of message, audience and contextual effects. The persistence of traditional attitudes among printers, the effects of war and adverse macro‐economic conditions were particularly important factors which induced resistance to attitudinal and behavioural change. Concludes that the uniform costing movement and the history of costing in artisan‐craft‐based industries merit deeper investigation.

ACCOUNTING FOR A DISAPPEARANCE: A CONTRIBUTION TO THE HISTORY OF THE VALUE ADDED STATEMENT IN THE UK

Burchell et als [1985] historical analysis of value added in the UK attributes its rise and fall to societal circumstances which initially encouraged the voluntary disclosure of the Value Added St...

Management accounting and decision making: Two case studies of outsourcing

Highlights • The Management Accounting and Decision Making: Two Case Studies explore the production and use of accounting information in complex and strategic significant decision settings.• We draw on two case companies that make outsourcing decisions based on accounting calculations.• Two methods for outsourcing decision-making are uncovered: an analytical and an actor-based.• The two methods have substantially different ways of managing information uncertainty, of fostering interaction among the coalition of decision-participants and of making use of management accounting.• The findings reveal that management accounting can be produced and used in relation to complex and strategic decision situations. Abstract Studying the outsourcing decision in two substantial manufacturing companies, the paper explores the use of management accounting information in a complex and strategically significant decision-making setting. The setting involves multiple decision participants with potentially conflicting preferences, constrained information provision capabilities and uncertainties in respect of the financial outcomes of alternative decision options. The two case studies reveal two different methodological approaches to decision-making: analytical and actor-based. These approaches incorporate substantially different ways of managing information uncertainty, fostering interaction among the coalition of decision-participants and making use of management accounting. The findings show that management accounting information and techniques do play an important role in relation to organisationally complex and strategic decision situations. The revealed methods provide potentially educational examples from which other organisations can learn. The findings address the simplistic nature of the conventional management accounting literature on decision-making (e.g. outsourcing and “make or buy”).