Accounting practices and professional power dynamics during a crisis

This paper examines how changes in accounting practices during a crisis can affect organisational dynamics between hospital managers and clinicians. Our theoretical framework applies a multi-dimensional concept of power (Hardy, 1996) – which distinguishes power over resources, processes and meaning – to a longitudinal case study of a public university hospital during a budgetary crisis. Based on interviews with managers and clinicians, three successive time intervals with distinct power constellations are identified. Initially, we identify a pre-crisis phase where management formally controls resources, which seems to have limited effects on clinician dominance because managers lack ‘processual power’ and ‘power of meaning’. Next, an implantation phase emerges whereby the introduction of mandated budget cuts triggers shifts in the distribution of power, such that managers acquire power by securing the collaboration of clinicians – a phenomenon which has tangible benefits in terms of enabling budget compliance and increased service provision. Finally, the third phase may be conceptualized as a fiscal pressure regimen whereby, when budgetary pressures intensify further, management's newly gained ‘power of meaning’ is eroded because management are now seen to pursue unrealistic demands. Drawing on research insights gleaned during each phase, our analysis contributes to extant literature in at least three ways. First, we present novel findings regarding the impact of crises-related applications of accounting practices on intra-organisational power constellations. Second, our work highlights how accounting practices help shape the understanding of crisis, which, in turn, impacts the distribution of organizational power and influences intra-organizational patterns of collaboration. Third, we find that awareness of the meaning power of accounting practices can help shape strategic action in crisis situations.     

Structure,formality and the importance of financial and non-financial information in strategy development and implementation

The strategic management literature indicates that there is high variety in the form and nature of strategic processes within organizations. By contrast, writers on strategic accounting tend focus on the structure and formality of strategic activities and call for a balance of financial and non-financial information to support strategic processes. This study explores the conceptual basis for this perspective and also investigates empirically whether such characterisations hold in practice. The empirical part of the study draws on questionnaire responses by senior corporate accountants and interviews held with a subset of respondents from this group. The results indicate that strategy development and implementation activities tend to be structured and formal, and while greater emphasis is placed on financial information in strategy implementation, in strategy development both financial and non-financial information are used. Differences however prevail across firms as to what is considered to be strategic and the role played by financial and non-financial information varies across companies. A high degree of organization specificity also exists in the uses of strategic accounting information. The study found support for normative ideals within the firms investigated but high organizational particularity also pervades the deployment of strategic accounting information.     

On the emergence of strategic management accounting: An institutional perspective

Strategic management accounting (SMA) has been presented as an efficacious approach to strategy formulation and implementation. It also suggests accountants move away from purely financial concerns to give consideration to wider business issues. Management accounting change has attracted significant research attention in recent years. This case study explores the issues which surround change and which enable the adoption of SMA and the repositioning of management accountants to become more strategic. The empirical enquiry is based in one company through a prolonged series of interviews and meetings which enabled activities over a number of years to be reviewed. This revealed an increasing strategic role for management accountants in informing strategic decision‐making and how this role came into being. The research is informed by institutional theories and neoinstitutionalism in particular, to interpret the external and internal influences on the change in roles of some management accountants and the outputs of their work.     

An institutional perspective on the changes in management accountants’ professional role

The paper theorises how a new actor of a firm can drive the institutionalisation of a new role for management accountants. Drawing on institutional theory and using insights from a single case study in a German manufacturing firm, the paper analyses the institutionalisation of the so-called “business partner” role for management accountants, which was promoted and driven by the case firm's newcomer CFO. The paper focuses on the micro-processes and especially the institutional work carried out by the new CFO that supported the entrenchment of the “business partner’ role within the case firm. In this light, we illustrate that especially three interrelated kinds of institutional work were carried out within the case firm to support the institutionalisation of the management accountants’ new role: (1) legitimising the new “business partner” role, (2) (re-)constructing the management accountants’ role identities and (3) linking the intra-organisational level with an institutional environment in which external actors aim to achieve changes in the management accountants’ role on a broader societal level. In this context, the paper also provides insights into the specific German management accounting context. Overall, the findings suggest that the institutionalisation of a new role for management accountants can be understood as the product of purposive actions carried out by actors to support a specific institutional arrangement within the firm.     

Total accounting in action: reflections on sten Jönsson’s Accounting for Improvement

Sten Jönsson’s recent book Accounting for Improvement (1996) examines organizational change processes based on several in-depth case-studies, conducted during a period of about ten years. In this review essay the arguments of the book are placed alongside recent discussions on management accounting practices, which have increasingly discovered the “hidden” potential of accounting and accountants. Jönsson’s book offers exciting insights into organizational improvement processes, which are linked to accounting in a particularly broad, “total accounting” sense. The major limitation of the book is held to be that it places accountants in the background of the analysis, perhaps reflecting problems in empirical research designs of the case-studies. As a result, the relationships and communication patterns between accountants and line personnel remain largely unexamined.     

A conceptual foundation of design and implementation research in accounting information systems

This structured literature review focuses on the design and implementation of systems in Accounting Information System (AIS) research. The review has two objectives: 1) To look in depth at AIS research regarding the design and implementation of information systems related to accounting in the last fifteen years; 2) To understand design and implementation issues in AIS. To do so, this research examines the current state of design and implementation research in the domain of AIS, using a structured review of abstracts in top-level Information Systems, Accounting, and AIS journals. Using a design science in IS theoretical framework, the review categorizes themes and trends in AIS literature. Some of the most relevant themes include audit/auditors, enterprise resource planning, monitoring and control, adoption, and decision making. The most relevant issues include training, commitment, investment, culture, and existing business processes. The research includes gaps, limitations, and opportunities for future research.     

AN EMPIRICAL ASSESSMENT OF THE “FIT”BETWEEN STRATEGY AND MANAGEMENT INFORMATION SYSTEM DESIGN

This paper was motivated by the limited understanding of the role of accounting vis a vis other information in supporting the needs of management. The paper reports the findings of a study which examined differences in the design parameters of management information systems in firms adopting different strategic priorities. Based on a sample of 49 business unit general managers, the findings indicate that the effectiveness of business units is dependent on a match between the design of the information system and the firm's strategic posture. Information systems which have the characteristics of a broad scope system were found to be more effective in firms employing a strategy of continuous product/market development and innovation (Prospectors) than in firms which were protecting a comparatively narrow and stable product-market (Defenders). The results have important implications for management accountants involved in the design and implementation of management information systems, especially in firms adopting a more innovative strategic posture. In particular, the study sheds light on the role of accounting as part of the “mosaic” of information provided to managers for decision making.     

Impact of accounting process characteristics on accounting outsourcing - Comparison of users and non-users of cloud-based accounting information systems

Prior literature informs us that a company's decision to outsource a business process depends on process characteristics such as how frequently the process is performed or how specific the assets required by the process are. In this article, we compare the effects of accounting process characteristics on outsourcing decisions across users of traditional and cloud-based accounting information systems (AIS). By focusing on outsourcing of accounting processes among small and medium sized enterprises, we investigate the effect of five business process characteristics (frequency, human asset specificity, uncertainty, information intensity, and need for customer contact) on the outsourcing decision. Our results reveal that process frequency has a weaker negative effect on the outsourcing decision among users of cloud-based AIS. This appears to contribute to users of cloud-based AIS outsourcing a larger variety of accounting processes. Compared to traditional AIS, the inherent properties of cloud-based AIS such as ubiquitous access, scalability, and integration seem to encourage users of cloud-based AIS to also outsource processes that are frequently performed.     

Factors influencing the role of management accounting in the development of performance measures within organizational change programs

Many companies are undergoing organizational changes encompassing innovative approaches to organizing production processes, restructuring work practices and developing new planning and control mechanisms. This paper explores the role that management accounting played in the development of performance measurement systems within five organizations implementing change programs. The major case study is of a large manufacturing firm undertaking changes which included the development of team structures, the adoption of a customer-focused strategy and the implementation of new performance measurement systems. In this company, a lack of integration of operational performance measures with strategic priorities contributed to poor integration of team activities with overall strategy. The paper proposes five interrelated factors that may help explain the extent to which management accountants contribute to the development of integrated performance measures and change programs. Case evidence drawn from a further four firms is presented to provide some validation of conclusions drawn from the primary case study.     

Organizational and environmental influences in the adoption of computer-assisted audit tools and techniques (CAATTs) by audit firms in Malaysia

Despite the usefulness of computer-assisted audit tools and techniques (CAATTs) in increasing audit productivity and reducing costs, their adoption by audit firms is low in developing countries. The aim of this study is to investigate whether organizational and environmental factors can help explain CAATTs adoption in less developed countries, such as Malaysia. The research framework was developed based on the Technology-Organization-Environment framework (TOE). The results reveal that for environmental factors, the complexity of clients' accounting information systems (AIS) and perceived level of support of professional accounting bodies (PABs) affect CAATTs adoption. For organizational factors, firm size, top management commitment and employee IT competency were found to be significant factors. Moreover, firm size partially moderates the influence of clients' AIS complexity on CAATTs adoption. This paper contributes to existing adoption theory by extending our understanding of the impact of factors unique to CAATTs adoption.     

Blockchain as the Database Engine in the Accounting System

This paper examines the prediction that blockchain technology will transform accounting and the profession because transactions recorded on a blockchain can be aggregated into financial statements and confirmed as true and accurate. We argue that blockchain technology affects the database engine of the accounting information system (AIS) through digitisation of the current paper‐based validation process. In a blockchain‐based AIS, accountants will no longer be the central authority but will remain the preparer of financial reports required by regulations; they will continue to influence policies such as the choice and accreditation of validators and serve as validators of last resort. Audit evidence still needs to be gathered for rendering of an audit opinion in a blockchain‐based AIS. While digitisation of the validation process reduces the error rate and lowers the cost of vouching and tracing, and immutability of blockchain data reduces the incentive and opportunities for fraud, a blockchain‐based AIS alone does not guarantee that financial reports are true and fair. Lower error rates and reduced incentives for accounting fraud in a blockchain‐based AIS are expected to improve audit quality. This prediction will need to be empirically tested when blockchain‐based AIS become available. Using the three‐tier architecture of the AIS, this paper addresses the gap in the literature that misses how characteristics of blockchain technology can influence the implementation of a blockchain‐based AIS with related implications for the accounting profession.     

The “now” economy and the traditional accounting reporting model: Opportunities and challenges for AIS research

The real time economy (RTE) can be characterized by a substantive acceleration of business measurement, assessment, and decision processes. It implies a new business model where there is reduction of intra-process and inter-process latency. The AIS research literature has failed to develop new paradigms for accounting of accelerated processes. This paper places key relevant research questions for accounting, assurance, and business information systems in the RTE.     

The role of budgets in organizations facing strategic change: an exploratory study

Recent attention in the general management literature has focused on mechanisms and processes used by organizations to respond and adapt to changes in their operating environment. There is, however, very little broad-based empirical research examining the role that management accounting control systems can play in shaping organizational change. Much of the empirical research to date has focused on the role of accounting as a diagnostic tool for assessing and rewarding managerial performance despite the recognition that accounting can serve as a dialogue, learning and idea creation machine (Burchell et al., 1980. Accounting Organisations and Society 5,5–27). The purpose of this study is to explore how accounting can serve this alternative role. We use (Simons, R. 1990.) Accounting Organisations and Society 15, 127–143). interactive/diagnostic classification of management control systems to capture how accounting can be used as a learning machine in the formulation and implementation of strategic change. A theoretical model is developed to examine the relationship between strategic change, style of budget use and performance. It is argued that an interactive style of budget use can mitigate the disruptive performance effects of the strategic change process. The data, collected from Chief Executive Officers in 63 public hospitals, provide results that are consistent with our expectations.     

Committed to professionalism: Organizational responses of mid-tier accounting firms to conflicting institutional logics

We study how mid-tier accounting firms deal with changes in their institutional environment that resulted in a shift in emphasis from the trustee logic to the commercial logic. We find that these mid-tier firms selectively adopt practices related to the commercial logic, while retaining a principal commitment to the trustee logic. Interviews with high level informants in these firms show how specific strategic choice opportunities serve as independent critical events framing practice-adoption decisions. Main strategic issues for the mid-tier firms relate to the changing role of the accountant and changes in organizational structure and practices. As these issues fundamentally challenge characteristics of their professional identity, there is internal resistance against this transformation. Non-partnered accountants mainly challenge new roles that upset their extant work routines, whereas partners resist changes affecting their autonomy. These types of resistance directly impact the strategic organizational responses of the accounting firms to institutional pressures.     

Enhancing student engagement in large management accounting lectures

The education literature suggests a student-focused teaching strategy to improve students’ engagement in a lecture. However, in traditional accounting lectures students take the role of passive and anonymous recipients of knowledge. This paper reports on two cycles of an action research project, developing and refining a blended learning model, with the purpose of enhancing students’ engagement in the lectures of a large management accounting course. Results of our study find that engagement was enhanced with the implementation of this model. This study contributes to the accounting education literature through reporting evidence from action research and the effective implementation of a blended learning model that accounting educators can use.     

Effects of the institutional environment on public-private partnership (P3) projects: Evidence from Canada

The purpose of this paper is to understand the effects of the institutional environment on project outcomes in order to contribute to the accumulating accounting literature on P3s. Based on an empirical study of Alberta’s institutional environment, using Edmonton’s Anthony Henday Highway P3 projects, we analyze how the: a) political environment enables or disenables P3 outcomes; b) policy/business environment impacts project development and implementation; and c) organizational capacity affects P3 outcomes and vice versa.Adopting a neo-institutionalism perspective and a case study approach, we investigate the effects of the institutional environment on P3 project outcomes. This research is based on 35 semi-structured interviews of public sector executive managers, political actors, senior industry executives, project consultants/advisors, labour union, media specialists, community advocates and public policy analysts in the P3 industry who participated in Alberta’s P3 projects from 2004 to 2016.We find that the institutional environment has significant influence on project performance, and program permanence/continuity. Our study suggests that P3 enabling environments present: 1) relevant P3 policy measures and committed political support by field actors; 2) a path-dependent response to project outcomes; and 3) institutional environment elements that are mutually re-enforcing with synergistic effects.In effect, we document that a strong political leadership support for P3s, a favourable policy environment, and effective organizational capacity are pre-requisite factors for the successful implementation of P3s. Given the unsettled debate about various methodological approaches to value for money (VfM) determination for assessing P3s, we are unsure whether our findings are partly influenced by inconsistent accounting standards for P3s across jurisdictions.Our study highlights critical P3 enabling attributes that would be beneficial to accounting researchers interested in institutional environment studies and co-operative arrangements, accountants, public sector policy managers, regulators, and private sector partners saddled with the task of developing and implementing P3 projects in various institutional and/or contextual settings.     

Strategic performance management: A balanced approach to performance management issues in local government

The drive for reform in the public sector worldwide has focussed attention on the measurement of performance in public sector organizations. This is particularly true in local government. Local government has traditionally been concerned with measuring the delivery of primary objectives, or results, at the expense of secondary objectives, or the determinants of organizational performance. Current strategic management literature suggests that there should be a strong linkage between strategic plans and performance measures.Kaplan and Norton’s (1992) balanced scorecard and Fitzgeraldet al. ’s (1991) results and determinants framework can provide this linkage. This paper reports on research into performance management systems in local government using the four dimensions of the balanced scorecard: financial, community, internal business processes and innovation and learning. It shows how the focus in this system of local government has been on the results of council work, ie. financial performance and to a lesser extent on how the community views performance. Local government performance measurement pays much less attention to the determinants, or means of achieving long-term, sustained organizational improvement in internal business processes, and innovation and learning. Whilst these issues are recognized as important, there are few measurement processes in place to manage performance in these areas. Strategic performance management demands an approach that recognizes the importance of a focus on both results and the means of achieving these results. This paper highlights a suggested framework for strategic and balanced local government performance measurement.