Understanding management accounting practices: A personal journey

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Abstract

This paper reviews the changes which have taken place in management accounting research over the last 35 years. It traces the author's personal journey as a management accounting researcher and emphasises the shift which has taken place in what it means to understand management accounting practices. It argues that to make sense of diversity in management accounting practices we need to understand the complex mish-mash of inter-related influences which shape practices in individual organisations. It outlines the contribution which institutional theories can make to understanding this mish-mash of complexity. In particular, it reviews the achievements of the Burns and Scapens framework (2000) for studying management accounting change and describes some of its limitations and extensions; viz., the interplay of internal and external institutions; the importance of trust in accountants; the impact of circuits of power; and the need to study the role of agency in institutional change. It concludes that research in recent years has provided a much clearer understanding of the processes which shape management accounting practices; but the challenge for the future is to use this theoretically informed understanding to provide relevant and useful insights for management accounting practitioners.

Section snippets

Setting off

After qualifying and working for 2 years as a chartered accountant, I joined the University of Manchester in 1970, as a P.D. Leake Teaching Fellow—funded by the Institute of Chartered Accountants in England and Wales (ICAEW). This was at a time when accounting as a university subject in the UK (especially in England1) was still

Understanding management accounting practices

In the early days, when I had just started doing case study research, there was one comment which a manager made that has stuck with me ever since. As I mentioned earlier, in the mid-1980s John Roberts and I were studying the role of accounting and accountability in the organisational control of large companies. In one of the companies we were studying, a large UK-based multinational, a management accountant described how practices had developed in his part of the company; a relatively small

The Burns and Scapens framework

This framework, which is set out in Fig. 1,9 draws on the ideas of OIE described above.10 At the top of the figure there are the institutions which comprise the ways of thinking

Stability and change

In the case of NP, we can see both evolution and revolution. There was a quite revolutionary change, but within it there were also evolutionary processes building on the existing quality-oriented ways of thinking. Thus, there were certain elements of stability within the process of change. So it is important not to regard stability and change as mutually exclusive—there can be elements of stability within change; and change may be necessary if things are to remain stable.12

Extensions and limitations

In this section, I will describe the work of some recent PhD students who have examined management accounting change in different countries, using the Burns and Scapens framework. I will start with a study, which explored the interaction of external and internal institutions in shaping management accounting practices. This study identified trust as one of the issues which needs to be considered in studying management accounting change. The next study will look more explicitly at issues of

Summary

To finish, I would like to summarise my personal journey trying to understand management accounting practices. From a starting point at which I was working with mathematical models and seeking to explore the extent to which they could be used to explain the diversity of practices in the population, I have moved to a position where I am studying the management accounting practices of individual organisations and seeking to explain how they are shaped and how they change (or are resistant to

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    This paper is a revised and extended version of a plenary address given at the 2005 Annual Conference of the British Accounting Association held at Heriot-Watt University, Edinburgh, Scotland, and was consequent on my receiving the 2004 BAA Distinguished Academic Award.

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