Factors explaining the use of management accounting practices in Malaysian medium-sized firms

Abstract

Purpose

The purpose of this paper is to investigate factors that affect the use of management accounting practices (MAPs) in Malaysian medium-sized firms in manufacturing sector.

Design/methodology/approach

A quantitative research design involving the use of postal questionnaire was carried out to investigate the influences of key contingent factors on MAPs. The survey was conducted to 500 Malaysian medium-sized firms in manufacturing sector which elicited 110 useable responses.

Findings

The results indicates that size of the firm, intensity of market competition, commitment of owner/manager of firm and advanced manufacturing technology have significant influences on the use of certain MAPs. Thus the research provides support for a contingency-based explanation for the use of MAPs and identifies new variable such as commitment of owner/manager as one of a key factor that affect the extent of use of MAPs in smaller firms.

Research limitations/implications

The research focused on medium-sized firms in manufacturing sector. Therefore the empirical research results may lack generalizability to the overall Malaysian small and medium-sized enterprises (SMEs). Future study might investigate whether there is a variation of the significant contingent factors in medium-sized firms across economies.

Practical implications

This research fills in the significant research gap and provides a start for further research into MAPs among SMEs based on a contingency approach.

Social implications

The results contribute to a better understanding of the factors underlying the development of MAPs among smaller firms.

Originality/value

The paper discusses key contingency factors influencing MAPs in larger firms and SMEs and how these factors could affect the use of MAPs in smaller firms’ context.

Citation

Ahmad, K. and Mohamed Zabri, S. (2015), "Factors explaining the use of management accounting practices in Malaysian medium-sized firms", Journal of Small Business and Enterprise Development, Vol. 22 No. 4, pp. 762-781. https://doi.org/10.1108/JSBED-04-2012-0057