On the Convergence of Management Accounting and Financial Accounting - The Role of Information Technology in Accounting Change

97 Pages Posted: 23 Nov 2011 Last revised: 26 Nov 2011

See all articles by Jani Taipaleenmaki

Jani Taipaleenmaki

University of Turku - Department of Accounting and Finance

Seppo Ikaheimo

Aalto University

Date Written: November 21, 2011

Abstract

In this article we explain why the recent development in MA and FA towards increased forward-looking perspective aligned with the advancements of information technology (IT) have lead to their convergence.

Drawing on the analytical model by Hemmer and Labro (2008) where forward-looking perspective of FA leads to forward-looking MA, we build a theoretical framework according to which information technology (IT) is a facilitator, catalyst, motivator or even an enabler of the convergence of MA and FA. The convergence covers firstly the technical and technological domain extending thereafter to behavioral and organizational domain with (un)intentional alignment of functions and processes and (un)intentional convergence of work and role. The applicability of this framework is illustrated with a comprehensive set of examples. Based on our examples, the forward-looking FA elements are often intertwined with MA and vice versa, and these relationships extend from technical and technological domain to behavioral and organizational domain. In most of our examples IT plays an important or even a crucial role in this convergence process.

Based on these convergence observations we open several avenues for further research, which increase both academic and practical relevance of accounting research.

Keywords: management accounting, financial accounting, forward-looking, convergence, information technology

JEL Classification: M15, M41

Suggested Citation

Taipaleenmaki, Jani and Ikaheimo, Seppo, On the Convergence of Management Accounting and Financial Accounting - The Role of Information Technology in Accounting Change (November 21, 2011). Available at SSRN: https://ssrn.com/abstract=1963638 or http://dx.doi.org/10.2139/ssrn.1963638

Jani Taipaleenmaki

University of Turku - Department of Accounting and Finance ( email )

Rehtorinpellonkatu 3
FI-20500 Turku
Finland

Seppo Ikaheimo (Contact Author)

Aalto University ( email )

P.O. Box 21210
Helsinki, 00101
Finland

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