Drivers of Management Control Systems Change: Additional Evidence from Australia
Abstract
Purpose
This study provides evidence on how changes in management accounting and control systems (MACS) associate with competition, organizational capacity to learn, decentralization, and firm size. In doing this, it replicates (and extends) Libby and Waterhouse’s (L&W) Canadian study in the context of Australian manufacturing firms.
Methodology/approach
Drawing on contingency theory, the study uses data from a mail-out survey of a sample of Australian manufacturing firms.
Findings
Change in MACS was found to be significantly and positively associated with greater organizational capacity to learn and a more intensely competitive environment. Firm size and decentralization were not highly significant with changes in MACS. Additional analysis of the data indicated the generalizability of the L&W model across divisions of large corporations, but not across stand-alone firms and local market-oriented firms.
Originality/value of paper
The results contribute to the field of management accounting change by suggesting that when an organization experiences changes in its business environment its management control systems need changes too.
Keywords
Acknowledgements
Acknowledgments
Financial support for this study was provided by the William P. Burkett Research Grant Scheme of CPA Australia. An earlier version of this paper was presented at Nanyang Business School of Nanyang Technology University (NTU), Singapore and 2008 Global Accounting and Organizational Change Conference in Melbourne. The author greatly appreciates Professor Hun Tong Tan and Dr. Khim Kelly for their useful comments on an earlier draft of this paper while at NTU in 2008 as a visiting professor. Editorial assistance by Shirin Hoque is also gratefully acknowledged.
Citation
Hoque, Z. (2014), "Drivers of Management Control Systems Change: Additional Evidence from Australia", Advances in Management Accounting (Advances in Management Accounting, Vol. 23), Emerald Group Publishing Limited, Leeds, pp. 65-92. https://doi.org/10.1108/S1474-787120140000023002
Publisher
:Emerald Group Publishing Limited
Copyright © 2014 by Emerald Group Publishing Limited