ENHANCING GOOD CORPORATE GOVERNANCE THROUGH THE APPLICATION OF RESPONSIBILITY-BASED MANAGEMENT ACCOUNTING SYSTEMS
Keywords:
Responsibility-Based Management Accounting, Corporate Governance, Accountability, Transparency.Abstract
This study examines how responsibility-based management accounting systems (RBMAS) contribute to enhancing good corporate governance, with a particular focus on accountability and transparency in modern organizations. It seeks to address the gap between formal governance structures and their practical effectiveness in supporting organizational control and decision-making. An exploratory qualitative study was conducted using a case study approach. Data were collected from organizational actors involved in accounting and governance practices through in-depth interviews, observations, and document analysis to capture comprehensive insights into system implementation. The collected data were analyzed using thematic analysis. The process involved coding, categorizing, and identifying key themes related to responsibility centers, transparency mechanisms, and governance outcomes. Data triangulation was applied to ensure credibility and consistency of findings. The findings reveal that the implementation of RBMAS strengthens accountability by clearly defining responsibility centers and performance measures. The system enables more structured reporting and improves decision-making processes. In addition, accounting systems enhance transparency by providing accurate and timely information, particularly when supported by digital technologies. However, challenges such as system integration and human factors influence the effectiveness of implementation. The study also highlights that governance effectiveness is shaped not only by technical systems but also by organizational culture and leadership support. Based on the findings, this study proposes a conceptual framework that integrates responsibility-based accounting systems with transparency mechanisms to enhance corporate governance. The results emphasize that effective governance requires alignment between accounting systems, organizational processes, and human factors in order to achieve sustainable performance and accountability.
Downloads
References
Abernethy, M. A., Bouwens, J., & Van Lent, L. (2020). Leadership and control system design. Management Accounting Research, 49, 100686. https://doi.org/10.1016/j.mar.2020.100686
Anthony, R. N., Govindarajan, V., Hartmann, F. G. H., Kraus, K., & Nilsson, G. (2014). Management control systems. McGraw-Hill.
Appelbaum, D., Kogan, A., Vasarhelyi, M., & Yan, Z. (2017). Impact of business analytics on accounting. Journal of Information Systems, 31(3), 45–68. https://doi.org/10.2308/isys-51693
Armstrong, C. S., Guay, W. R., & Weber, J. P. (2015). The role of information and financial reporting. Journal of Accounting and Economics, 50(2–3), 179–234. https://doi.org/10.1016/j.jacceco.2010.10.001
Bedford, D. S., & Speklé, R. F. (2018). Construct validity in management control systems research. Management Accounting Research, 38, 37–50. https://doi.org/10.1016/j.mar.2017.03.002
Bhimani, A. (2020). Digital data and management accounting. Journal of Management Control, 31(1–2), 9–23. https://doi.org/10.1007/s00187-020-00295-z
Bowen, G. A. (2009). Document analysis as a qualitative research method. Qualitative Research Journal, 9(2), 27–40. https://doi.org/10.3316/QRJ0902027
Bushman, R. M., & Smith, A. J. (2003). Transparency, financial accounting information, and corporate governance. Economic Policy Review, 9(1), 65–87.
Bushman, R. M., Chen, Q., Engel, E., & Smith, A. (2018). Financial accounting information and corporate governance. Journal of Accounting and Economics, 32(1–3), 237–333. https://doi.org/10.1016/S0165-4101(01)00027-1
Charmaz, K. (2014). Constructing grounded theory (2nd ed.). Sage Publications.
Chenhall, R. H., & Moers, F. (2015). The role of innovation in management control systems. Accounting, Organizations and Society, 47, 1–13. https://doi.org/10.1016/j.aos.2015.10.002
Christensen, D. M., Floyd, E., Liu, L. Y., & Maffett, M. (2021). The real effects of mandated transparency. The Accounting Review, 96(4), 193–219. https://doi.org/10.2308/TAR-2019-0137
COSO. (2017). Enterprise risk management framework.
Dechow, P. M., Ge, W., & Schrand, C. (2010). Understanding earnings quality. Journal of Accounting and Economics, 50(2–3), 344–401. https://doi.org/10.1016/j.jacceco.2010.09.001
Denzin, N. K., & Lincoln, Y. S. (2018). The SAGE handbook of qualitative research (5th ed.). Sage Publications.
Drury, C. (2018). Management and cost accounting. Cengage.
Eccles, R. G., & Krzus, M. P. (2010). One report: Integrated reporting for a sustainable strategy. Wiley.
Granlund, M. (2019). Digitalisation of management accounting. Accounting Forum, 43(1), 1–17. https://doi.org/10.1080/01559982.2019.1589909
Granlund, M., & Mouritsen, J. (2003). Introduction: Problematising the relationship between management control and information technology. European Accounting Review, 12(1), 77–83. https://doi.org/10.1080/0963818031000087855
Healy, P. M., & Palepu, K. G. (2001). Information asymmetry, corporate disclosure, and capital markets. Journal of Accounting and Economics, 31(1–3), 405–440. https://doi.org/10.1016/S0165-4101(01)00018-0
Healy, P. M., & Palepu, K. G. (2001). Information asymmetry, corporate disclosure, and capital markets. Journal of Accounting and Economics, 31(1–3), 405–440. https://doi.org/10.1016/S0165-4101(01)00018-0
Hope, O. K., Thomas, W. B., & Vyas, D. (2013). Financial reporting quality and investment efficiency. Journal of Accounting and Economics, 55(2–3), 104–121. https://doi.org/10.1016/j.jacceco.2013.01.001
Horngren, C. T., Datar, S. M., & Rajan, M. V. (2018). Cost accounting: A managerial emphasis. Pearson.
Ittner, C. D., & Larcker, D. F. (2003). Coming up short on nonfinancial performance measurement. Harvard Business Review, 81(11), 88–95.
Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm. Journal of Financial Economics, 3(4), 305–360. https://doi.org/10.1016/0304-405X(76)90026-X
Kaplan, R. S., & Atkinson, A. A. (2019). Advanced management accounting. Pearson.
Lambert, R. A., Leuz, C., & Verrecchia, R. E. (2007). Accounting information and economic consequences. Journal of Accounting Research, 45(2), 385–420. https://doi.org/10.1111/j.1475-679X.2007.00238.x
Malmi, T. (2016). Management control systems research. Management Accounting Research, 31, 23–35. https://doi.org/10.1016/j.mar.2016.03.001
Merchant, K. A., & Otley, D. T. (2007). A review of the literature on control systems. Handbooks of Management Accounting Research, 2, 785–802. https://doi.org/10.1016/S1751-3243(06)02013-5
Merchant, K. A., & Van der Stede, W. A. (2017). Management control systems. Pearson.
Neely, A. (2018). Performance measurement system design. International Journal of Operations & Production Management, 25(12), 1228–1263. https://doi.org/10.1108/01443570510633639
Nowell, L. S., Norris, J. M., White, D. E., & Moules, N. J. (2017). Thematic analysis: Striving to meet the trustworthiness criteria. International Journal of Qualitative Methods, 16(1), 1–13. https://doi.org/10.1177/1609406917733847
Otley, D. (2016). The contingency theory of management accounting. Management Accounting Research, 31, 45–62. https://doi.org/10.1016/j.mar.2016.02.001
Otley, D., & Ferreira, A. (2009). The design and use of performance management systems. Management Accounting Research, 20(4), 263–282. https://doi.org/10.1016/j.mar.2009.07.003
Patton, M. Q. (2015). Qualitative research & evaluation methods (4th ed.). Sage Publications.
Power, M. (2009). The risk management of everything. Journal of Risk Finance, 10(4), 345–357. https://doi.org/10.1108/15265940910980692
Quattrone, P. (2016). Management accounting goes digital. Accounting and Business Research, 46(2), 118–142. https://doi.org/10.1080/00014788.2016.1148723
Rom, A., & Rohde, C. (2007). Management accounting and integrated information systems. International Journal of Accounting Information Systems, 8(1), 40–68. https://doi.org/10.1016/j.accinf.2006.12.003
Rubin, H. J., & Rubin, I. S. (2012). Qualitative interviewing: The art of hearing data (3rd ed.). Sage Publications.
Schaltegger, S., & Burritt, R. (2018). Sustainability accounting. Accounting, Auditing & Accountability Journal, 31(2), 1–21. https://doi.org/10.1108/AAAJ-03-2018-3425
Simons, R. (1995). Levers of control. Harvard Business School Press.
Spradley, J. P. (2016). Participant observation. Waveland Press.
Stake, R. E. (1995). The art of case study research. Sage Publications.
Tessier, S., & Otley, D. (2012). A conceptual development of management control systems. Management Accounting Research, 23(3), 171–185. https://doi.org/10.1016/j.mar.2012.04.003
Tracy, S. J. (2010). Qualitative quality: Eight “big-tent” criteria for excellent qualitative research. Qualitative Inquiry, 16(10), 837–851. https://doi.org/10.1177/1077800410383121
Tricker, B. (2019). Corporate governance: Principles, policies, and practices. Oxford University Press.
Uyar, A., Gungormus, A. H., & Kuzey, C. (2020). Impact of digitalization on accounting. International Journal of Accounting Information Systems, 38, 100466. https://doi.org/10.1016/j.accinf.2020.100466
Zimmerman, J. L. (2017). Accounting for decision making and control. McGraw-Hill.
Downloads
Published
Conference Proceedings Volume
Section
License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
