International Business Financial & Management Accounting

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�PAGE � �PAGE �1� Financial & Management Accounting

Running Head: International Business

International Business Financial & Management Accounting


International Business Financial & Management Accounting


Do financial and management accounting practices differ across countries? The commonly accepted view on the relationship between, for instance, national cultures and financial and management accounting suggests that they do (e.g., Ahrens 1996; Carr and Tomkins 1996; Chow et al. forthcoming). However, in this study, we are more interested in the identification of similarities of financial and management accounting practices across countries.

The argument of our paper builds on observations of a rather strong current tendency toward global homogenization of management accounting practices. Since practice is a multifaceted term, it is possible to focus on various aspects of practice: systems, processes, information use, accountants' behaviour, etc. It is possible to examine practices at the micro or macro levels, or both (Gupta and Govindarajan 2001; Harrison and McKinnon in press).

By macro level we mean concepts (e.g., in an ABC context, activity or cost driver), ideas (e.g., in ABC, improved allocation of overheads to cost objects in today's operating environment), techniques (e.g., ABC as a two/multi-step cost allocation technique), system designs (e.g., how with what kind of software is ABC is technically implemented) and, at least partly, the purpose of using certain pieces of management accounting information (e.g., advanced process cost control or reduction of overheads through ABC implementation), which form the basis or framework for the micro-level action to take place (cf. Shields 1998). On the other hand, by micro level we refer to behavioural patterns and styles of information use, like budgetary-related behaviour (Hopwood 1973; Otley 1978; Lukka 1998; Ahrens 1996). Micro level hence deals with the practical "doing" of financial and management accounting in the everyday life of organizational actors, here denoting...