The adoption and success of contemporary management accounting practices in the public sector

Nuraddeen Abubakar Nuhu, Kevin Baird and Appuhami Bala Appuhamilage

Asian Review of Accounting, 2017, vol. 25, issue 1, 106-126

Abstract: Purpose - The purpose of this paper is to examine the association between the interactive and diagnostic use of MCSs with the extent of adoption of contemporary management accounting practices, and the subsequent impact on the success of such practices in the public sector. Design/methodology/approach - Data were collected through the distribution of a mail survey of 740 questionnaires to public sector organisations in Australia, and analysed using structural equation modelling. Findings - The study found that both the interactive and diagnostic approaches to using MCSs exhibit a positive association with the adoption of contemporary management accounting practices, both as a package and individually. In addition, while the level of success of contemporary management accounting practices was moderate, it was found that the extent of adoption of the practices enhanced their success. Practical implications - The findings suggest that by intensifying the use of MCSs in a more interactive and diagnostic manner, public sector organisations are more likely to adopt contemporary management to a greater extent, with the subsequent increase in the extent of adoption of such practices to exacerbate their success. Originality/value - The study contributes to the MCS contingency-based research by highlighting the interrelationship between two aspects of MCSs, the use of controls and the adoption and success of management accounting practices.

Keywords: Adoption; Success; Public sector; Contemporary management accounting practices; Diagnostic use; Interactive use (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:eme:arapps:ara-02-2016-0017

DOI: 10.1108/ARA-02-2016-0017

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