Advances in Management Accounting

ISBN: 978-1-78973-278-8, eISBN: 978-1-78973-277-1

ISSN: 1474-7871

Publication date: 16 July 2019


(2019), "Prelims", Burney, L.L. and Malina, M.A. (Ed.) Advances in Management Accounting (Advances in Management Accounting, Vol. 31), Emerald Publishing Limited, Leeds, pp. i-xvi.



Emerald Publishing Limited

Copyright © 2019 Emerald Publishing Limited

Half Title Page

Advances in Management Accounting

Series Page

Advances in Management Accounting

Series Editors:

Volumes 1–25: Marc J. Epstein and John Y. Lee

Volumes 26 and 27: Marc J. Epstein and Mary A. Malina

Volumes 28–30: Mary A. Malina

Recent Volumes:

Volume 30: Advances in Management Accounting Edited by Mary A. Malina

Title Page

Advances in Management Accounting Volume 31

Advances in Management Accounting

Edited By

Laurie L. Burney

Baylor University, USA

Mary A. Malina

University of Colorado Denver, USA

United Kingdom – North America – Japan India – Malaysia – China

Copyright Page

Emerald Publishing Limited

Howard House, Wagon Lane, Bingley BD16 1WA, UK

First edition 2019

Copyright © 2019 Emerald Publishing Limited

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No part of this book may be reproduced, stored in a retrieval system, transmitted in any form or by any means electronic, mechanical, photocopying, recording or otherwise without either the prior written permission of the publisher or a licence permitting restricted copying issued in the UK by The Copyright Licensing Agency and in the USA by The Copyright Clearance Center. Any opinions expressed in the chapters are those of the authors. Whilst Emerald makes every effort to ensure the quality and accuracy of its content, Emerald makes no representation implied or otherwise, as to the chapters’ suitability and application and disclaims any warranties, express or implied, to their use.

British Library Cataloguing in Publication Data

A catalogue record for this book is available from the British Library

ISBN: 978-1-78973-278-8 (Print)

ISBN: 978-1-78973-277-1 (Online)

ISBN: 978-1-78973-279-5 (Epub)

ISSN: 1474-7871 (Series)


List of Contributors vii
Editorial Board ix
Statement of Purpose xi
Manuscript form Guidelines xiii
Laurie L. Burney and Mary A. Malina
Competitor Monitoring and Revenue Performance: Evidence from the Hospitality Industry
James W. Hesford, Michael J. Turner, Nicolas Mangin, Charles R. Thomas Jr., and Kelly Hoffmann
An Empirical Examination of Economic Determinants of Financial CEO Compensation: A Comparative Study on Pre- and Post-financial Crisis Periods
Mahfuja Malik and Eunsup Daniel Shim
Firm Performance Implications of Using Qualitative Criteria in CEO Bonus Contracts
Ahmet C. Kurt and Nancy Chun Feng
Performance-based Pay, Performance Monitoring, and Dishonest Behavior: The Plot Thickens
Charles Bailey, Nicholas Fessler and Brian Laird
The Role of Managerial Ability in Classification Shifting Using Discontinued Operations
Christopher Skousen, Li Sun and Kean Wu
Cash-to-cash (C2C) Length: Insights on Present and Future Profitability and Liquidity
Binod Guragai, Paul D. Hutchison and M. Theodore Farris II

List of Contributors

Charles Bailey James Madison University, USA
Nancy Chun Feng Suffolk University, USA
Nicholas Fessler The University of Texas at Tyler, USA
Binod Guragai Texas State University, USA
James W. Hesford University of Lethbridge, Canada
Kelly Hoffmann E&Y, Germany
Paul D. Hutchison University of North Texas, USA
Ahmet C. Kurt Suffolk University, USA
Brian Laird Arkansas State University, USA
Mahfuja Malik Sacred Heart University, USA
Nicolas Mangin University of Groningen, The Netherlands
Eunsup Daniel Shim Sacred Heart University, USA
Christopher Skousen Utah State University, USA
Li Sun The University of Tulsa, USA
M. Theodore Farris II University of North Texas, USA
Charles R. Thomas, Jr Tarleton State University, USA
Michael J. Turner The University of Queensland, Australia
Kean Wu Rochester Institute of Technology, USA

Editorial Board

  • Christopher Akroyd

    Oregon State University, USA

  • Shannon W. Anderson

    University of California Davis, USA

  • Jan Bouwens

    University of Cambridge, UK

  • Adriana Rejc Buhovac

    University of Ljubljana, Slovenia

  • Clara X. Chen

    University of Illinois, USA

  • Martine Cools

    Katholieke Universiteit Leuven, Belgium

  • Antonio Dávila

    University of Navarra, Spain

  • Eric G. Flamholtz

    University of California, Los Angeles, USA

  • Dipankar Ghosh

    University of Oklahoma, USA

  • Frank G. H. Hartmann

    Erasmus University, The Netherlands

  • James W. Hesford

    University of Lethbridge, Canada

  • Robert Hutchinson

    Michigan Tech University, USA

  • Leslie Kren

    University of Wisconsin, Milwaukee, USA

  • Raef Lawson

    Institute of Management Accountants, USA

Statement of Purpose

Advances in Management Accounting (AIMA) is a publication of quality, applied research in management accounting. The series’ purpose is to publish thought-provoking articles that advance knowledge in the management accounting discipline and are of interest to both academics and practitioners. The journal seeks thoughtful, well-developed articles on a variety of current topics in management accounting, broadly defined. All research methods including survey research, field tests, corporate case studies, experiments, meta-analyses, and modeling are welcome. Some speculative articles, research notes, critiques, and survey pieces will be included where appropriate.

Articles may range from purely empirical to purely theoretical, from practice-based applications to speculation on the development of new techniques and frameworks. Empirical articles must present sound research designs and well-explained execution. Theoretical arguments must present reasonable assumptions and logical development of ideas. All articles should include well-defined problems, concise presentations, and succinct conclusions that follow logically from the data.

Review Procedures

AIMA intends to provide authors with timely reviews clearly indicating the acceptance status of their manuscripts. The results of initial reviews normally will be reported to authors within eight weeks from the date the manuscript is received. The author will be expected to work with the Editor, who will act as a liaison between the author and the reviewers to resolve areas of concern. To ensure publication, it is the author’s responsibility to make necessary revisions in a timely and satisfactory manner.

Manuscript Form Guidelines

  • Manuscripts should include a cover page that indicates the author’s name and affiliation.

  • Manuscripts should include a separate lead page with a structured abstract (not to exceed 250words) set out under four to seven sub-headings; purpose, design/methodology/approach, findings, research limitations/implications (if applicable), practical implications (if applicable), social implications (if applicable), and originality/value. Keywords should also be included. The author’s name and affiliation should not appear on the abstract.

  • Tables, figures, and exhibits should appear on a separate page. Each should be numbered and have a title.

  • To be assured of anonymous reviews, authors should not identify themselves directly or indirectly.

  • Manuscripts currently under review by other publications should not be submitted.

  • Authors should email the manuscript in two WORD files to the editor. The first attachment should include the cover page and the second should exclude the cover page.

  • Inquiries concerning Advances in Management Accounting should be directed to:

Laurie L. Burney


This volume of Advances in Management Accounting (AIMA) represents the diversity of management accounting topics, methods, and author affiliations, which form the basic tenets of AIMA. Included are papers on traditional management accounting topics such as performance measurement, and pay and compensation systems, as well as those on broader topics of interest to management accountants such as employees’ dishonesty, whether managerial ability is associated with firm performance, and CEO compensation. The articles in this volume utilize a wide variety of methods including archival data analysis and experimental studies. Finally, the diversity in authorship is apparent with affiliations from Canada, Australia, the Netherlands, Germany, and the United States.

In the first article, Hesford, Turner, Mangin, Thomas, and Hoffmann examine an interesting question about the relationship between competitor monitoring and firm performance. Using proprietary data from the hotel industry, they find that a hotel’s competitor monitoring behavior is positively associated with its performance outcomes, measured as (i) revenue per available room, (ii) average daily rate, and (iii) occupancy rate. This article further documents a positive relationship with performance when the hotel monitors hotels above its class, yet a negative relationship when it monitors those hotels below its class.

In the second article, Malik and Shim address a timely issue that has received quite some attention in the media: is CEO compensation in financial institutions partly responsible for the 2008 financial crisis and has this issue been resolved in the postcrisis period? Using data from the US financial service institutions, they study the economic determinants of executive compensation both pre- and post-crisis periods. This article provides insight into the compensation/performance relationship within the financial services industry.

Continuing the focus on CEO compensation, Kurt and Feng delve into this literature with thought provoking and practically relevant research. Specifically, the article details an investigation into whether it is beneficial to include qualitative performance measures in CEO bonus contracts. Collecting data from firms’ proxy statements, Kurt and Feng find that when qualitative criteria are included in CEO bonus contracts, not only is performance across an array of measures lower but that income-increasing accruals are higher.

The fourth article by Bailey, Fessler, and Laird extends prior literature on agents’ dishonesty by investigating two organizational variables: performance-based pay and performance monitoring. In their experimental setting, agents have the opportunity to engage in dishonest behavior for personal gain; yet, the principal has no mechanism for detecting the dishonesty. The authors explain the findings of an interaction effect using arousal theory, suggesting that performance-based pay heightens the focus on monetary awards, which leads to decreased honesty. However, the perception of being monitored helps mitigate this effect.

In the fifth article, Skousen, Sun, and Wu examine the relationship between managerial ability and discontinued operations. They find that managerial ability has a negative relationship with the likelihood and magnitude of discontinued operations. While prior studies have shown that higher ability managers are less likely to manage earnings by manipulating accruals, this article aims to build on this work by showing that higher ability managers are less likely to shift expenses to discontinued operations from core operations.

Concluding this volume, Guragai, Hutchison, and Farris address a gap in the cash-to-cash cycle (C2C) by examining the association with long-term profitability and liquidity. Conventional wisdom and finance theory suggest that tying up funds in working capital leads to an increased cost of capital. C2C, by measuring a company’s use of working capital, is an important financial evaluation tool. Prior research indicates that a longer C2C cycle is negatively associated with current period performance. This article extends these findings by documenting the performance effects at longer time horizons, and expands the analyses to study the results across industries and firm sizes.

The six articles in Volume 31 represent relevant, theoretically sound, and practical studies that extend our knowledge within the management accounting discipline. These articles manifest the journal’s commitment to providing a high level of contribution to management accounting research and practice.

Laurie L. Burney

Mary A. Malina