Financial Measures Bias in the Use of Performance Measurement Systems

Advances in Management Accounting

ISBN: 978-0-76231-243-6, eISBN: 978-1-84950-367-9

ISSN: 1474-7871

Publication date: 10 December 2005


This paper examines potential cognitive difficulties inherent in the use of performance measurement systems. We examine the potential for emphasizing financial measures as compared to nonfinancial measures in the evaluation of an organization's overall performance. The results suggest that users of performance measurement data will emphasize historical financial measures. Two separate experiments provide additional evidence that users of performance measurement data suffer a halo bias, in that an organization's performance on financial measures appears to influence their perception of the organization's performance on nonfinancial measures.


DeBusk, G., Killough, L. and Brown, R. (2005), "Financial Measures Bias in the Use of Performance Measurement Systems", Epstein, M. and Lee, J. (Ed.) Advances in Management Accounting (Advances in Management Accounting, Vol. 14), Emerald Group Publishing Limited, Bingley, pp. 61-89.

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