Issues in Management Accounting

Chris Akroyd (The University of Auckland, Auckland, New Zealand)

Journal of Accounting & Organizational Change

ISSN: 1832-5912

Article publication date: 21 March 2008



Akroyd, C. (2008), "Issues in Management Accounting", Journal of Accounting & Organizational Change, Vol. 4 No. 1, pp. 85-86.



Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited

The third edition of Issues in Management Accounting includes 20 new and original chapters on management accounting topics written by management accounting academics from around the world. This, the editors argue, shows the “globalisation” of management accounting both in practice and in terms of the research community. This aspect of the book broadens its appeal beyond a European audience as the chapters use a range of examples from organizations across not only Europe but also North America, Asia and Australasia. In addition to the 20 chapters, the book has an introduction by the editors. I found this a useful addition as it gave both an overview of each chapter and explained how they fit together. At the end of each chapter, the authors also give a list of further readings with a narration explaining what the reading is about to help direct the reader to articles and books that examine the ideas presented in further detail.

The stated aim of the book is to “critically explore … research and practical developments in the area” for both “students and practitioners.” The editors state the book is designed as a complement to traditional textbooks for upper level undergraduates, postgraduates and professional studies which are said to be “unduly conservative and professionally and technically oriented.” In my opinion, the editors have been true to their word and have put together an interesting book that challenges the reader to think about management accounting issues in different contexts from a number of perspectives.

To manage the flow of the book the editors have divided it into four parts. The first part that focuses on the changing nature of management accounting, has a diverse range of chapters which examine management accounting in relation to operations management ( Hansen and Mouritsen), consumerism ( Jeacle), information technology ( Dechow, Granlund and Mouritsen), globalisation ( Busco, Giovannoni and Riccaboni), national culture ( Harrison and McKinnon) and the role of management accountants (Burns and Baldvinsdottir). These chapters go beyond a simple review of these concepts as the authors also critically examine the role management accounting can play. I found this to be useful in understanding the issues that exist in these contexts. The first chapter by Mouritsen and Hansen is a good example of this. The chapter starts by setting out the tensions between the aims of management accounting and operations management. It then sets out some connections between the two and critiques the role of accounting in this context.

Part 2 of the book examines the so‐called “new” management accounting techniques such as ABC (Major), BSC (Nørreklit and Mitchell), strategic investment appraisal (Northcott and Alkaraan), strategic management accounting (Lord) and performance measurement (Fitzgerald). Each of these chapters reviews and critiques the research on the technique and explains how and/or why they are used in practice. I found the reviews and critiques to be limited in some chapters such as the ones on strategic management accounting, ABC and the BSC but this was probably due to the amount written on these areas in the accounting literature. For this reason, the authors of these chapters have concentrated their critique on a few specific issues.

Part 3 examines new applications of management accounting. This section has chapters on EVA (Bouwens and Speklé), inter‐organizational relationships (Kraus and Lind), public‐private partnerships (Moll and Humphrey), and knowledge resources (Roberts). These chapters were some of the best in the book as they showed how management accounting is being adapted to deal with current business issues. While EVA is now covered to some extent in many conventional textbooks, the other areas represent potential new topic areas. The chapter by Roberts on knowledge resources is a good example of one of these new applications of management accounting. In this chapter, Roberts examines how knowledge resources develop within an organization and then explores some of the economic characteristics of knowledge. The chapter ends with some ideas about how management accounting concepts and information can be useful in this context.

Finally, Part 4 aims to understand management accounting change. The topics covered in these chapters include management accounting change (Modell), management accounting innovations (Ax and Bjørnenak), the relevance of the past (Fleischman and Funnell), economics‐based management accounting research (Göx and Wagenhofer), and qualitative management accounting research (Vaivio). The first three chapters on management accounting change, innovations and the relevance of the past examine different aspects of management accounting change taking place within organizations. The final two chapters on economic and qualitative research present two approaches researchers have used to examine management accounting practice. This section has the most diverse range of topics and is focused more towards research‐based postgraduate students than undergraduate or MBA students.

As with any book attempting to cover in a brief form a broad range of topics there are limitations. The most significant limitation was that many of the chapters rely on a single theoretical perspective. The chapters I liked the most were able to examine and critique their area from multiple theoretical perspectives. One of the best was the chapter by Kraus and Lind on management control in inter‐organizational relationships. This chapter showed how management control and inter‐organizational relationships can be viewed from a breadth of different theoretical perspectives including transaction cost economics, agency theory, actor‐network theory, and industrial network approaches.

In summary, the chapters in this book are concise, well written and are supported by useful references. This makes the book a valuable contribution to our knowledge of current management accounting issues in practice. I can see how chapters in this book could supplement a traditional textbook for upper level undergraduate and MBA courses and supplement journal articles for more research‐based postgraduate courses.

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