Impact of Management Accounting on Performance of Manufacturing Companies in Nigeria

Reference code: C065

ABSTRACT

This research project set out to investigate the impact of management accounting activities of manufacturing companies in Nigeria on their financial performance. in order to achieve the objectives of our study, two hypotheses were formulated and data collected from manufacturing companies through the issue of sixty structured questionnaires out of which fifty nine were duly completed and returned. the returned questionnaires were analysed using regression analyses on SPSS version 21. in the course of the analyses, the following findings were made: there is a positive and significant relationship between cost accounting activities and the financial performance of manufacturing companies in Nigeria. findings also reported a positive and significant relationship between activity management and the profitability of manufacturing companies in Nigeria. Finally, our analyses showed that a majority of the manufacturing companies in our sample routinely embarked on Strategic Management Accounting Activities. given our findings, we concluded that: Cost management activities is a major contributor for enhanced financial performance of manufacturing companies in Nigeria. We also conclude that activity management contribute significantly to the profitability of manufacturing companies in Nigeria.  Finally, we conclude that manufacturing companies who embark on management accounting activities are bound to be more productive and profitable than their counterparts who take such activities for granted. Given our findings and conclusion above, we make the following recommendations: Manufacturing companies should not only embark on cost management activities but from time to time review their cost management methods in order to continually discover loopholes in their methods and cover such loopholes. Manufacturing companies should provide adequate training for their management accounting staff on the best practices inherent in the field.

INTRODUCTION

.............. Managerial accounting, or management accounting, is a set of practices and techniques aimed at providing managers with financial information to help them make decisions and maintain effective control over corporate resources. These include the methods and concepts necessary for effective planning, decision making (choosing among alternative business actions and controlling through the evaluation and interpretation of performance.
Management accounting practice helps an organization to survive in the competitive, ever-changing world, because it provides an important competitive advantage for an organization that guides managerial action, motivates behaviors, supports and creates the cultural values necessary to achieve an organization’s strategic objectives. Management accounting is concerned primarily with the internal needs of management. It is oriented toward evaluation of performance and development of estimates of the future as opposed to traditional financial accounting which emphasizes historical data related to such legal financial matters as ownership, investment, credit granting, taxation, regulation, and the building of foundations for consistent and conservative external reporting, “in accordance with generally accepted accounting principles.”
Flexibility is an essential characteristic of management accounting since it presupposes that careful attention has been given to determine the important needs of management, many of which cannot be precisely identified in advance (Parker, 2002). The Institute of Management Accountants (IMA), the professional association of practicing and academic management accountants, defines management accounting as “The process of identification, measurement, accumulation, analysis, preparation, interpretation, and communication of financial information used by management to plan, evaluate, and control within an organization and to assure appropriate use of and accountability for its resources. Management accounting also comprises the preparation of financial reports for non-management groups such as shareholders, creditors, regulatory agencies, and tax authorities” (Smith, 2009).
Management accounting provides information from its environment to management to facilitate decision-making. Good management accounting information has three attributes: Technical-it enhances the understanding of the phenomena measured and provides relevant information for strategic decisions, Behavioral-it encourages actions that are consistent with an organization’s strategic objectives, and Cultural-it supports and/or creates a set of shared cultural values, beliefs, and mindsets in an organization and society (Ashton et al., 1991).
The development of management accounting is responsive to the demands of management and the environment. Management accounting adapts to organizational change and three major forces cause organizations to evolve: technological change, globalization, and customer needs (McWatters, 2001). In order to remain competitive in today’s global market, business must continually improve. Good management accounting practices help the organization to improve continually. Due to these all over the world there are so many management accounting tools & techniques developed and practiced. ...............FOR ACCESS TO THE FULL PROJECT WORK, USE THE ORDER NOW! BUTTON BELOW

TABLE OF CONTENTS: 
CHAPTER ONE: INTRODUCTION
1.9 BACKGROUND OF THE STUDY 1
1.10 STATEMENT OF RESEARCH PROBLEM 6
1.11 PURPOSE OF THE STUD 7
1.12 STATEMENT OF RESEARCH QUESTION 8
1.13 RESEARCH HYPOTHESES 8
1.14 SIGNIFICANCE OF THE STUDY 8
1.15 SCOPE AND LIMITATION OF STUDY 9
1.16 ORGANIZATION OF STUDY 10
1.9 DEFINITION OF TERMS 11

CHAPTER TWO: REVIEW OF RELEVANT LITERATURE
2.1 THEORETICAL FRAMEWORK 12
2.1.1 Contingency Theory of Mgt Accounting 12
2.1.2 New Institutional Sociology 14
2.2 CONCEPTS OF MANAGEMENT ACCOUNTING
2.3 MGT ACCOUNTING & FINANCIAL PERFORMANCE 22
2.4 REVIEW OF RELEVANT EMPIRICAL LITERATURE 25

CHAPTER THREE: RESEARCH METHODOLOGY
3.4 INTRODUCTION 33
3.5 RESEARCH DESIGN 33
3.6 RESEARCH POPULATION 34
3.7 SAMPLING PROCEDURE/SAMPLE SIZE
DETERMINATION 35
3.5 DATA ANALYSIS TECHNIQUES 37

CHAPTER FOUR: DATA PRESENTATION ANALYSIS AND DISCUSSION
4.1 INTRODUCTION 38
4.2 DATA PRESENTATION AND ANALYSIS 39
4.3 TEST HYPOTHESES 44
4.3.1 Testing of Hypothesis One 44
4.3.2 Testing of Hypothesis Two 46

CHAPTER FIVE: SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
5.1 SUMMARY OF FINDINGS 48
5.2 CONCLUSIONS 49
5.3 RECOMMENDATIONS 50
BIBLIOGRAPHY 51

Reference code: C065

Reference code: C065

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