Drivers and Barriers to Management Accounting Change

47 Pages Posted: 28 Jul 2007 Last revised: 11 Jan 2008

See all articles by Felix Schwarze

Felix Schwarze

Goethe University Frankfurt - Department of Finance; E-Finance Lab

Kim Wuellenweber

University Frankfurt - E-Finance Lab

Andreas Hackethal

Goethe University Frankfurt - Faculty of Economics and Business Administration; Goethe University Frankfurt - Research Center SAFE

Date Written: November 1, 2007

Abstract

Empirical studies report a gap between theoretical concepts of management accounting and the actual practice in organizations. Specifically, there is a virtual absence of literature on the individual factors that drive or hinder the adoption of sophisticated management accounting concepts. In this paper, we analyze drivers and inhibitors of management accounting change from a managerial perspective. Our research model is an adoption of the theory of planned behavior and reasoned action (Ajzen and Fishbein, 1980: Understanding Attitudes and Predicting Social Behavior. Prentice Hall: Englewood Cliffs, NY). Based on survey data of 161 banks in German-speaking countries, we show that management accounting change is driven by board expectations, transparency, and profitability. IT capabilities and behavioral control enable change. Only organizational change impedes the adoption of sophisticated methods. The factors costs and staff do not have a significant impact on manager's attitude. Moreover, in a group analysis, we analyze if the importance of drivers and barriers differs between banks with a focus on sophisticated financial measures compared to banks with a focus on a broad set of non-financial measures. We find that banks which manage by means of financial measures are more profitability driven by board and managerial encouragement. Banks using non-financial measures tend to increase transparency but struggle with organizational change.

Keywords: management accounting, accounting change, bank, field study

JEL Classification: M40, M46, G21

Suggested Citation

Schwarze, Felix and Wuellenweber, Kim and Hackethal, Andreas, Drivers and Barriers to Management Accounting Change (November 1, 2007). AAA 2008 MAS Meeting Paper. Available at SSRN: https://ssrn.com/abstract=1003371 or http://dx.doi.org/10.2139/ssrn.1003371

Felix Schwarze (Contact Author)

Goethe University Frankfurt - Department of Finance ( email )

House of Finance
Grüneburgplatz 1
Frankfurt am Main, Hessen 60323
Germany

HOME PAGE: http://www.finance.uni-frankfurt.de/index.php?men=2&case=wimi2&id=320&lg=

E-Finance Lab ( email )

House of Finance
Grüneburgplatz 1
Frankfurt am Main, Hessen 60323
Germany

HOME PAGE: http://www.finance.uni-frankfurt.de/index.php?men=2&case=wimi2&id=320&lg=

Kim Wuellenweber

University Frankfurt - E-Finance Lab ( email )

Grüneburgplatz 1
Frankfurt am Main, 60323
Germany

Andreas Hackethal

Goethe University Frankfurt - Faculty of Economics and Business Administration ( email )

Theodor-W.-Adorno Platz 3
Frankfurt am Main, 60323
Germany

Goethe University Frankfurt - Research Center SAFE ( email )

(http://www.safe-frankfurt.de)
Theodor-W.-Adorno-Platz 3
Frankfurt am Main, 60323
Germany

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