Skills, Influence, and Effectiveness of Management Accountants

Document Type : Research Paper

Authors

1 Assistant professor of , Management and Accounting ,Shahid Beheshti University, Tehran, Iran

2 M.A. of management accounting, Shahid Beheshti university, Tehran, Iran.

10.22099/jaa.2022.43316.2228

Abstract

Introduction

Management accountants (MAs) have two functions in organizations: consulting and controlling. Therefore, performing these two functions leads to conflict. Management accountants need different skills to be effective in performing their roles. Our study examines whether MAs and Financial managers believe that MAs need interpersonal skills, conceptual, and/or technical skills to be influential and effective in performing this expanded role.
 

Hypotheses

The main question is, Do management accountants, financial managers and internal auditors believe that interpersonal, conceptual, and technical skills affect MAs’ effectiveness and influence? Thus, to answer this question, the following hypotheses will be tested:

Technical skills positively affect MAs’ effectiveness.
Conceptual skills positively affect MAs’ effectiveness.
Interpersonal skills positively affect MAs’ effectiveness.
Technical skills positively affect MAs’ influence on management.
Conceptual skills positively affect MAs’ influence on management.
Interpersonal skills positively affect MAs’ influence on management.
The combination of technical and conceptual skills positively affects MAs’ effectiveness.
The combination of technical and interpersonal skills positively affects MAs’ effectiveness.
The combination of conceptual and interpersonal skills positively affects MAs’ effectiveness.
The combination of technical and conceptual skills positively affects MAs’ influence on management.
The combination of technical and interpersonal skills positively affects MAs’ influence on management.
The combination of conceptual and interpersonal skills positively affects MAs’ influence on management.

 

Method

To collect data, 257 management accountants, financial managers and internal auditors of Iranian public companies were surveyed and a partial least squares path model was developed.
 

Results

We conclude that according to the internal auditors, financial managers and MAs’ perceptions, Technical and conceptual skills are associated with their effectiveness, while interpersonal skills influence management’s decision making. We also find that technical, conceptual and interpersonal skills are jointly associated with the influence and effectiveness of MAs.
 

Discussion and Conclusion

According to the research findings, MAs need interpersonal skills (i.e., ability to constructively challenge and question assumptions, numbers, and their meanings), conceptual skills (i.e., making and leading decisions consistent with the organization’s business environment and strategy), and/or technical skills (i.e., computer, accounting, and data modeling) to be influential and effective
 
 

Keywords

Anderson, C., Spataro, S. E., & Flynn, F. J. (2008). Personality and organizational culture as determinants of influence. Journal of Applied Psychology, 93(3), 702-710.

Babajani, J., Khonaka, A. (2018). a future studies approach to identifying and macro analyzing the trends influencing the future of management accounting from the perspective of professions and businesses. Journal of Health Accounting, 6(2), 24-45. (In Persian)

Biddle, B.J. (1979). Role theory: Expectations, Identities, and Behaviors. Academic Press, New York.

Boyatzis, R. E., Good, D., & Massa, R. (2012). Emotional, social, and cognitive intelligence and personality as predictors of sales leadership performance. Journal of Leadership & Organizational Studies, 19(2), 191-201.

Breuer, A., Frumusanu, M. L., & Manciu, A. (2013). The role of management accounting in the decision making process: Case study Caras Severin County. Annales Universitatis Apulensis: Series Oeconomica, 15(2), 355-366.

Brewer, P. C., Garrison, R. H., & Noreen, E. W. (2015). Managerial accounting (p. 832). McGraw-Hill Create.

Budding, T., Wassenaar, M. (2021), New development: Is there a management accountants’ expectation gap?. Public Money & Management, 41(4),346-350.

Burns, J., & Baldvinsdottir, G. (2005). An institutional perspective of accountants' new roles–the interplay of contradictions and praxis. European Accounting Review, 14(4), 725-757.

Byrne, S., & Pierce, B. (2007). Towards a more comprehensive understanding of the roles of management accountants. European Accounting Review, 16(3), 469-498.

Chang, H., Ittner, C. D., & Paz, M. T. (2014). The multiple roles of the finance organization: Determinants, effectiveness, and the moderating influence of information system integration. Journal of Management Accounting Research, 26(2), 1-32.

Chenhall, R. H., & Langfield-Smith, K. (1998). The relationship between strategic priorities, management techniques and management accounting: an empirical investigation using a systems approach. Accounting, Organizations and Society, 23(3), 243-264.

David Garson, G. (2016). Partial least squares: Regression & structural equation models. Raleigh, NC: Statistical Publishing Associates.

Fornell, C., & Larcker, D. (1981). Structural equation models with unobservable variables and measurement error, Journal of Marketing Research, 18(1), 39-50.

Fowzia, R. (2011). Strategic management accounting techniques: Relationship with business strategy and strategic effectiveness of manufacturing organizations in Bangladesh. World Journal of Management, 3(2), 54-69.

Graham, A., Davey‐Evans, S., & Toon, I. (2012). The developing role of the financial controller: evidence from the UK. Journal of Applied Accounting Research, 13(1),71-88.

Haghighat Shahrestani, M., Kheradyar, S., Mohammadi Nodeh, F. (2021). The effect of internal audit effectiveness and quality of financial reporting on information asymmetry between manager and auditor. Journal of Accounting Advances, 13(1), 101-129. (In Persian).

Hall, M., Mikes, A., & Millo, Y. (2015). How do risk managers become influential? A field study of toolmaking in two financial institutions. Management Accounting Research, 26(1), 3-22.

Hassall, T., Joyce, J., Montaño, J. L. A., & Anes, J. A. D. (2005). Priorities for the development of vocational skills in management accountants: A European perspective. In Accounting Forum, 29(4), 379-394.

Hassas Yeganeh, Y; Dianti Deilami, Z; Nowruzbegi, E. (2011). Management accounting practices in the firms listed on the Tehran stock exchanged: An empirical examination. Management Accounting, 4 (8), 1-18. (In Persian)

Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43(1), 115-135.

Horngren, C. T., Datar, S. M., Foster, G., Rajan, M. V., & Ittner, C. (2011). Cost accounting: a managerial emphasis. Pearson Education India.

Jablonsky, S. F., Keating, P. J., & Heian, J. B. (1993). Business advocate or corporate policeman?: Assessing your role as a financial executive. Financial Executives Research Foundation.

Katz, R.L. (2009). Skills of an effective administrator, Harvard Business School Publishing Corporation, Boston, originally published in Harvard Business Review, 1974.

Maas, V. S., & Matejka, M. (2009). Balancing the dual responsibilities of business unit controllers: Field and survey evidence. The Accounting Review, 84(4), 1233-1253.

Merchant, K. A., & Van der Stede, W. A. (2012). Management control systems: performance measurement, evaluation and incentives. Pearson education.

Momeni, M; Qayyumi, A. (2007), statistical analysis using SPSS, Tehran: Mansour Momeni Publishing (In Persian).

Momm, T., G. Blickle, Y. Liu, A. Wihler, M. Kholin, and J. I. Menges. (2015). It pays to have an eye for emotions: Emotion recognition ability indirectly predicts annual income. Journal of Organizational Behavior 36(1), 147 - 163.

Mowday, R. T. (1978). The exercise of upward influence in organizations. Administrative Science Quarterly, 23(1), 137-156.

Namazi, M., Esmaeilpour, H. (2020). the effect of neural knowledge on the decisions and risks of the activities of management accountants. Journal of Accounting Advances, 12(2), 351-386. (In Persian)

Noravesh, I and Mashayekhi, B. (2005), Management accounting training needs and priorities: Perceptual distance between academics and accounting professionals, Accounting and Auditing Review, 12 (41), 133-161. (In Persian)

O’Boyle, Jr. E.H., R.H. Humphrey, J.M. Pollack, T.H. Hawver, and P.A. Story. (2011). The relation between emotional intelligence and job performance: A meta-analysis. Journal of Organizational Behavior 32(5), 788 - 818.

Pizzini, M.J. (2006). The relation between cost-system design, managers’ evaluation of the relevance and usefulness of cost data, and financial performance: An empirical study of US hospitals. Accounting, Organizations and Society 31(2), 179 – 210.

Sathe, V. (1983). The controller's role in management. Organizational Dynamics, 11(3), 31-48.

Schmidt, F.L., and J.E. Hunter. (1998). The validity and utility of selection methods in personnel psychology: Practical and theoretical implications of 85 years of research findings. Psychological Bulletin, 124(2), 262 - 274.

Shekarkhah, J., Ghorbani, M., Fallah, H. (2014). The role of experience in managerial decision making and the place of managerial accountants. Journal of Management Accounting and Auditing Knowledge, 3 (10),107-116. (In Persian)

Speklé, R. F., & Widener, S. K. (2018). Challenging issues in survey research: Discussion and suggestions. Journal of Management Accounting Research, 30(2), 3-21.‏

Spraakman, G., Sanchez-Rodriguez, C., & Tuck-Riggs, C. A. (2021). Data analytics by management accountants. Qualitative Research in Accounting & Management, 18(1), 127-147.

 Tajvidi, E., Mohammadi, S. (2020). The role of management accounting information in management control system in large manufacturing companies in iran. Management Accounting, 13(46), 1-16. (In Persian).

Rouwelaar, H., Schaepkens, F., & Widener, S. K. (2021). Skills, influence, and effectiveness of management accountants. Journal of Management Accounting Research, 33(2), 211-235.

Rouwelaar, H., Bots, J. and De Loo, I. (2018), The influence of management accountants on managerial decisions, Journal of Applied Accounting Research, 19(4), 442-464.

Vaivio, J., & Kokko, T. (2006). Counting big: re-examining the concept of the bean counter controller. Liiketaloudellinen aikakauskirja, 1(6), 49-74.

Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2012). Managerial accounting: tools for business decision making. John Wiley & Sons.‏

Zainuddin, Z. N., & Sulaiman, S. (2016). Challenges faced by management accountants in the 21st century. Procedia Economics and Finance, 37, 466-470.

 

 

 

References

ب. انگلیسی
Anderson, C., Spataro, S. E., & Flynn, F. J. (2008). Personality and organizational culture as determinants of influence. Journal of Applied Psychology, 93(3), 702-710.
Babajani, J., Khonaka, A. (2018). a future studies approach to identifying and macro analyzing the trends influencing the future of management accounting from the perspective of professions and businesses. Journal of Health Accounting, 6(2), 24-45. (In Persian)
Biddle, B.J. (1979). Role theory: Expectations, Identities, and Behaviors. Academic Press, New York.
Boyatzis, R. E., Good, D., & Massa, R. (2012). Emotional, social, and cognitive intelligence and personality as predictors of sales leadership performance. Journal of Leadership & Organizational Studies, 19(2), 191-201.
Breuer, A., Frumusanu, M. L., & Manciu, A. (2013). The role of management accounting in the decision making process: Case study Caras Severin County. Annales Universitatis Apulensis: Series Oeconomica, 15(2), 355-366.
Brewer, P. C., Garrison, R. H., & Noreen, E. W. (2015). Managerial accounting (p. 832). McGraw-Hill Create.
Budding, T., Wassenaar, M. (2021), New development: Is there a management accountants’ expectation gap?. Public Money & Management, 41(4),346-350.
Burns, J., & Baldvinsdottir, G. (2005). An institutional perspective of accountants' new roles–the interplay of contradictions and praxis. European Accounting Review, 14(4), 725-757.
Byrne, S., & Pierce, B. (2007). Towards a more comprehensive understanding of the roles of management accountants. European Accounting Review, 16(3), 469-498.
Chang, H., Ittner, C. D., & Paz, M. T. (2014). The multiple roles of the finance organization: Determinants, effectiveness, and the moderating influence of information system integration. Journal of Management Accounting Research, 26(2), 1-32.
Chenhall, R. H., & Langfield-Smith, K. (1998). The relationship between strategic priorities, management techniques and management accounting: an empirical investigation using a systems approach. Accounting, Organizations and Society, 23(3), 243-264.
David Garson, G. (2016). Partial least squares: Regression & structural equation models. Raleigh, NC: Statistical Publishing Associates.
Fornell, C., & Larcker, D. (1981). Structural equation models with unobservable variables and measurement error, Journal of Marketing Research, 18(1), 39-50.
Fowzia, R. (2011). Strategic management accounting techniques: Relationship with business strategy and strategic effectiveness of manufacturing organizations in Bangladesh. World Journal of Management, 3(2), 54-69.
Graham, A., Davey‐Evans, S., & Toon, I. (2012). The developing role of the financial controller: evidence from the UK. Journal of Applied Accounting Research, 13(1),71-88.
Haghighat Shahrestani, M., Kheradyar, S., Mohammadi Nodeh, F. (2021). The effect of internal audit effectiveness and quality of financial reporting on information asymmetry between manager and auditor. Journal of Accounting Advances, 13(1), 101-129. (In Persian).
Hall, M., Mikes, A., & Millo, Y. (2015). How do risk managers become influential? A field study of toolmaking in two financial institutions. Management Accounting Research, 26(1), 3-22.
Hassall, T., Joyce, J., Montaño, J. L. A., & Anes, J. A. D. (2005). Priorities for the development of vocational skills in management accountants: A European perspective. In Accounting Forum, 29(4), 379-394.
Hassas Yeganeh, Y; Dianti Deilami, Z; Nowruzbegi, E. (2011). Management accounting practices in the firms listed on the Tehran stock exchanged: An empirical examination. Management Accounting, 4 (8), 1-18. (In Persian)
Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43(1), 115-135.
Horngren, C. T., Datar, S. M., Foster, G., Rajan, M. V., & Ittner, C. (2011). Cost accounting: a managerial emphasis. Pearson Education India.
Jablonsky, S. F., Keating, P. J., & Heian, J. B. (1993). Business advocate or corporate policeman?: Assessing your role as a financial executive. Financial Executives Research Foundation.
Katz, R.L. (2009). Skills of an effective administrator, Harvard Business School Publishing Corporation, Boston, originally published in Harvard Business Review, 1974.
Maas, V. S., & Matejka, M. (2009). Balancing the dual responsibilities of business unit controllers: Field and survey evidence. The Accounting Review, 84(4), 1233-1253.
Merchant, K. A., & Van der Stede, W. A. (2012). Management control systems: performance measurement, evaluation and incentives. Pearson education.
Momeni, M; Qayyumi, A. (2007), statistical analysis using SPSS, Tehran: Mansour Momeni Publishing (In Persian).
Momm, T., G. Blickle, Y. Liu, A. Wihler, M. Kholin, and J. I. Menges. (2015). It pays to have an eye for emotions: Emotion recognition ability indirectly predicts annual income. Journal of Organizational Behavior 36(1), 147 - 163.
Mowday, R. T. (1978). The exercise of upward influence in organizations. Administrative Science Quarterly, 23(1), 137-156.
Namazi, M., Esmaeilpour, H. (2020). the effect of neural knowledge on the decisions and risks of the activities of management accountants. Journal of Accounting Advances, 12(2), 351-386. (In Persian)
Noravesh, I and Mashayekhi, B. (2005), Management accounting training needs and priorities: Perceptual distance between academics and accounting professionals, Accounting and Auditing Review, 12 (41), 133-161. (In Persian)
O’Boyle, Jr. E.H., R.H. Humphrey, J.M. Pollack, T.H. Hawver, and P.A. Story. (2011). The relation between emotional intelligence and job performance: A meta-analysis. Journal of Organizational Behavior 32(5), 788 - 818.
Pizzini, M.J. (2006). The relation between cost-system design, managers’ evaluation of the relevance and usefulness of cost data, and financial performance: An empirical study of US hospitals. Accounting, Organizations and Society 31(2), 179 – 210.
Sathe, V. (1983). The controller's role in management. Organizational Dynamics, 11(3), 31-48.
Schmidt, F.L., and J.E. Hunter. (1998). The validity and utility of selection methods in personnel psychology: Practical and theoretical implications of 85 years of research findings. Psychological Bulletin, 124(2), 262 - 274.
Shekarkhah, J., Ghorbani, M., Fallah, H. (2014). The role of experience in managerial decision making and the place of managerial accountants. Journal of Management Accounting and Auditing Knowledge, 3 (10),107-116. (In Persian)
Speklé, R. F., & Widener, S. K. (2018). Challenging issues in survey research: Discussion and suggestions. Journal of Management Accounting Research, 30(2), 3-21.‏
Spraakman, G., Sanchez-Rodriguez, C., & Tuck-Riggs, C. A. (2021). Data analytics by management accountants. Qualitative Research in Accounting & Management, 18(1), 127-147.
 Tajvidi, E., Mohammadi, S. (2020). The role of management accounting information in management control system in large manufacturing companies in iran. Management Accounting, 13(46), 1-16. (In Persian).
Rouwelaar, H., Schaepkens, F., & Widener, S. K. (2021). Skills, influence, and effectiveness of management accountants. Journal of Management Accounting Research, 33(2), 211-235.
Rouwelaar, H., Bots, J. and De Loo, I. (2018), The influence of management accountants on managerial decisions, Journal of Applied Accounting Research, 19(4), 442-464.
Vaivio, J., & Kokko, T. (2006). Counting big: re-examining the concept of the bean counter controller. Liiketaloudellinen aikakauskirja, 1(6), 49-74.
Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2012). Managerial accounting: tools for business decision making. John Wiley & Sons.‏
Zainuddin, Z. N., & Sulaiman, S. (2016). Challenges faced by management accountants in the 21st century. Procedia Economics and Finance, 37, 466-470.
 
 
 

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History

  • Receive Date: 12 March 2022
  • Revise Date: 11 June 2022
  • Accept Date: 11 June 2022

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