An exploratory study on the usage of Management Accounting Practices among Small and Medium Enterprises in Zimbabwe.
Abstract
The study explored the use of Management Accounting Practices (MAPs) by Small and Medium Enterprises (SMEs) operating in Zimbabwe as there is paltry research-based knowledge on the extent of their use. The study adopted an exploratory qualitative research approach following the interpretivist paradigm using a semi-structured interview for data collection from eighty-eight participants and utilizing content analysis. The study revealed that there is generally a low adoption of MAPs though there is relatively a high usage of traditional MAPs as compared to contemporary MAPs among SMEs in Zimbabwe. The study concludes that the failure of SMEs lies in the low utilization of MAPs, therefore it recommends that SMEs should increase the uptake of both traditional and contemporary MAPs as these techniques are not only essential for promoting success and survival of SMEs but they also create value for the entity. The Zimbabwean government and other stakeholders should also promote the usage of MAPs among SMEs as this will improve economic development. The usage of MAPs plays a pivotal role in the success of an entity in the modern globalised business. The study highly recommends the development of a management accounting framework for SMEs as it might affluence the application of MAPs among these small businesses.
References
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Agu, C.K, Nweze, U.A. &Enekwe, C.I. 2016. The Use of Strategic Management Accounting Techniques (SMATs) in Sustainability Performance Measurement for Corporate Governance in Nigeria. International Journal of Academic Research in Accounting, Finance and Management Sciences, 6(3): 262–271.
Ahmad, K 2013. The Adoption of Management Accounting Practices in Malaysian Small and Medium-Sized Enterprises. Asian Social Science, 10(2): 1911-2025.
Ahmad, K. 2012. The Use of Management Accounting Practices in Malaysian SMEs, University of Exeter
Ahmad, K. 2017. The Implementation of Management Accounting Practices and its Relationship with Performance in Small and Medium Enterprise, International Review of Management and Marketing, 7(1): 342-353.
Ahmad, K., & Zabri, S.M., 2015. "Factors explaining the use of management accounting practices in Malaysian medium-sized firms". Journal of Small Business and Enterprise Development, 22(4)762-781.
Ahmad, K., 2017. The implementation of management accounting practices and it relationship with performance in Small and Medium Enterprises. International Review of Management and Marketing, 7(1), 342-353
Alsoboa, S., Al Khattab, A., & Al-Rawad, M. 2015. The extent to which the Jordanian private industrial companies Use SMA Techniques. European Journal of Business and Management, 7(7): 456-465.
Bruns W.J., & McKinnon SM. 1993. Information and managers: A field study. Journal Management Accounting Research, 5:84-108..
Caro, F. & Gallien, J. 2010. Inventory management of a fast-fashion retail network. Operations research, 58(2): 257-273.
Chenhall, R., & Langfield-Smith, K. 1998. Adoption and benefits of management accounting practices: an Austrailian study. Management Accounting Research, 9: 1-19.
Crossman P.T. 1958. The nature of management accounting. Account Rev 33(2):222
Dlamini, B. 20200 Insight on the use of management accounting practices among large manufacturing entities in Zimbabwe: A Case study of Bulawayo Metropolitan Province. International Journal of Advanced Research and Publications, 4(2): 32-37
Domingo, R. (2017). Small business and entrepreneurship: Their role in economic and social development. Entrepreneurship & Regional Development, 29(2), 1–3.
Drury, C. 2012. Management and Cost Accounting. London: Cengage.
Drury, C., Braund, S., Osborne, P. & Tayles, M. 1993. A survey of management accounting practices in UK manufacturing companies, Chartered Association of Certified Accountants
Emmanuel, C., Otley, D. & Merchant, K., 1990. Accounting for Management Control, 2nd ed., London: Chapman & Hall.
Gichaaga, P.M., 2014. Effects of Management Accounting Practices on Financial Performance of Manufacturing Companies in Kenya, Msc. Thesis. University of Nairobi
Hall, M. 2008.The effect of comprehensive performance measurement systems on role clarity, psychological empowerment and managerial performance. Accounting, Organizations and Society, 33:141-163.
Hermes, N., Smid, P. & Yao, L. 2007. Capital budgeting practices: A comparative study of the Netherlands and China. International Business Review, 16: 630-654.
Hopper, T., Koga, T. & Goto, J. 1999. Cost accounting in small and medium sized Japanese companies: an exploratory study. Accounting and Business Research, 30(1):73-86.
Horngren C.T., Bhimani A., Datar S., & Foster G. 2005.Management and cost accounting. Financial Times Prentice Hall, Harlow
Innes, J. & Mitchell, F. 1995. A survey of activity-based costing in the UK's large companies, Management Accounting Research, 6(2):137-53.
Ittner, C. D. & Larcker, D.F., 2001. Assessing empirical research in managerial accounting: A value-based management perspective. Journal of Accounting and Economics: 349-410.
Johnson, H.T. & Kaplan, R.S. 1987. Relevance Lost: The Rise and Fall of Management Accounting, Cambridge, M A: Harvard University Press.
Joshi, P.L. 2001. The international diffusion of new management accounting practices: the case of India. Journal of International Accounting, Auditing and Taxation, 10:85-109.
Kithae, P. P., Kimani, J. G. T., & Mburia, N. (2013). Hindrances to the growth of youth led micro and small agri-businesses in Kenya. American Journal of Research Communication, 1(12), 339– 352
Kumar, N. and Mahto, D. 2013. A Comparative Analysis and Implementation of Activity Based Costing (ABC) and Traditional Cost Accounting (TCA) Methods in an Automobile Parts Manufacturing Company: A Case Study, Global Journal of Management and Business Research Accounting and Auditing,13(4): 29-38.
Leconte, P. 2020. Learn how an organization’s success is determined without financials, including specific examples of non-financial performance measures worth tracking, https://www.clearpointstrategy.com/nonfinancial-performance-measures. Date of access: 20 Oct. 2020.
Lorenz, A. 2015. Contemporary Management Accounting in the UK Service Sector, PhD Thesis, The University of Gloucestershire.
Lucas M., Prowle M., & Lowth G. 2013. Management Accounting Practices of (UK) Small-Medium-Sized Enterprises (SMEs). Improving SME performance through Management. Accounting Education, Chartered Institute of Management Accounting 9(4): 1-14.
Lukka, K. & Granlund, M. 1996. Cost accounting in Finland: current practice and trends of development. The European Accounting Review, 5: 1-28.
Maduekwe, C.C., & Kamala, P., 2016. The use of budgets by small and medium enterprises in Cape Metropolis, South Africa. Problems and Perspectives in Management, 14(1)
Manyani, O. 2014. An investigation into venture financing. A case study of Small to Medium Scale Enterprises in Bindura urban, Zimbabwe (2013-2014). Elite Research Journal of Accounting and Business Management, 2(2):10-25
Maseko N., & Munyani 2011. Accounting Practices of SMES in Zimbabwe: An Investigative Study of Record Keeping for Performance Measurement (A Case Study of Bindura). Journal of Accounting and Taxation, 13(8):171-181
Mitchell, F. & Reid, G. 2000. “Problems, Challenges, and Opportunities: Small Business as a Setting for Management Accounting Research”. Management Accounting Research, 11(4): 385-390.
Mulani, J., Chi, G. & Yang, J. 2015. Effects of the budgetary process on SME’s performance: An Exploratory study based on Selected SME’s in India, Research Journal of Finance and Accounting, 6(14): 135-154.
Neely, A., Bourne, M., & Adams, C. 2003. Better budgeting or beyond budgeting. Measuring Business Excellence, 7 (3):22-28.
Nyanga, T., Zirima, H., Mupani, H., Chifamba, E. & Mashavira, N., 2013. Survival of the vulnerable: Strategies employed by small to medium enterprises in Zimbabwe to survive an economic crisis. Journal of Sustainable Development in Africa 15(6).
Ojua M.O. 2016. Strategic Management Accounting Practices among Indigenous Nigerian Manufacturing Enterprises. Open Science Journal 1(2):1-9
RBZ. (2016). Developmental SME projects intervention to support the youth, women and other disadvantaged groups. Harare: RBZ.
Szychta, A. 2002. The scope of application of management accounting methods in Polish enterprises. Management Accounting Research, 13: 401-418.
Wu, J., Boateng, A. & Drury, C. 2007. An analysis of the adoption, perceived benefits, and expected future emphasis of western management accounting practices in Chinese SOEs and JVs. The International Journal of Accounting, 42: 171-185.
Yoshikawa, T. 1994. Some aspects of the Japanese approach to management accounting‘, Management Accounting Research, 5: 279-89.
Agu, C.K, Nweze, U.A. &Enekwe, C.I. 2016. The Use of Strategic Management Accounting Techniques (SMATs) in Sustainability Performance Measurement for Corporate Governance in Nigeria. International Journal of Academic Research in Accounting, Finance and Management Sciences, 6(3): 262–271.
Ahmad, K 2013. The Adoption of Management Accounting Practices in Malaysian Small and Medium-Sized Enterprises. Asian Social Science, 10(2): 1911-2025.
Ahmad, K. 2012. The Use of Management Accounting Practices in Malaysian SMEs, University of Exeter
Ahmad, K. 2017. The Implementation of Management Accounting Practices and its Relationship with Performance in Small and Medium Enterprise, International Review of Management and Marketing, 7(1): 342-353.
Ahmad, K., & Zabri, S.M., 2015. "Factors explaining the use of management accounting practices in Malaysian medium-sized firms". Journal of Small Business and Enterprise Development, 22(4)762-781.
Ahmad, K., 2017. The implementation of management accounting practices and it relationship with performance in Small and Medium Enterprises. International Review of Management and Marketing, 7(1), 342-353
Alsoboa, S., Al Khattab, A., & Al-Rawad, M. 2015. The extent to which the Jordanian private industrial companies Use SMA Techniques. European Journal of Business and Management, 7(7): 456-465.
Bruns W.J., & McKinnon SM. 1993. Information and managers: A field study. Journal Management Accounting Research, 5:84-108..
Caro, F. & Gallien, J. 2010. Inventory management of a fast-fashion retail network. Operations research, 58(2): 257-273.
Chenhall, R., & Langfield-Smith, K. 1998. Adoption and benefits of management accounting practices: an Austrailian study. Management Accounting Research, 9: 1-19.
Crossman P.T. 1958. The nature of management accounting. Account Rev 33(2):222
Dlamini, B. 20200 Insight on the use of management accounting practices among large manufacturing entities in Zimbabwe: A Case study of Bulawayo Metropolitan Province. International Journal of Advanced Research and Publications, 4(2): 32-37
Domingo, R. (2017). Small business and entrepreneurship: Their role in economic and social development. Entrepreneurship & Regional Development, 29(2), 1–3.
Drury, C. 2012. Management and Cost Accounting. London: Cengage.
Drury, C., Braund, S., Osborne, P. & Tayles, M. 1993. A survey of management accounting practices in UK manufacturing companies, Chartered Association of Certified Accountants
Emmanuel, C., Otley, D. & Merchant, K., 1990. Accounting for Management Control, 2nd ed., London: Chapman & Hall.
Gichaaga, P.M., 2014. Effects of Management Accounting Practices on Financial Performance of Manufacturing Companies in Kenya, Msc. Thesis. University of Nairobi
Hall, M. 2008.The effect of comprehensive performance measurement systems on role clarity, psychological empowerment and managerial performance. Accounting, Organizations and Society, 33:141-163.
Hermes, N., Smid, P. & Yao, L. 2007. Capital budgeting practices: A comparative study of the Netherlands and China. International Business Review, 16: 630-654.
Hopper, T., Koga, T. & Goto, J. 1999. Cost accounting in small and medium sized Japanese companies: an exploratory study. Accounting and Business Research, 30(1):73-86.
Horngren C.T., Bhimani A., Datar S., & Foster G. 2005.Management and cost accounting. Financial Times Prentice Hall, Harlow
Innes, J. & Mitchell, F. 1995. A survey of activity-based costing in the UK's large companies, Management Accounting Research, 6(2):137-53.
Ittner, C. D. & Larcker, D.F., 2001. Assessing empirical research in managerial accounting: A value-based management perspective. Journal of Accounting and Economics: 349-410.
Johnson, H.T. & Kaplan, R.S. 1987. Relevance Lost: The Rise and Fall of Management Accounting, Cambridge, M A: Harvard University Press.
Joshi, P.L. 2001. The international diffusion of new management accounting practices: the case of India. Journal of International Accounting, Auditing and Taxation, 10:85-109.
Kithae, P. P., Kimani, J. G. T., & Mburia, N. (2013). Hindrances to the growth of youth led micro and small agri-businesses in Kenya. American Journal of Research Communication, 1(12), 339– 352
Kumar, N. and Mahto, D. 2013. A Comparative Analysis and Implementation of Activity Based Costing (ABC) and Traditional Cost Accounting (TCA) Methods in an Automobile Parts Manufacturing Company: A Case Study, Global Journal of Management and Business Research Accounting and Auditing,13(4): 29-38.
Leconte, P. 2020. Learn how an organization’s success is determined without financials, including specific examples of non-financial performance measures worth tracking, https://www.clearpointstrategy.com/nonfinancial-performance-measures. Date of access: 20 Oct. 2020.
Lorenz, A. 2015. Contemporary Management Accounting in the UK Service Sector, PhD Thesis, The University of Gloucestershire.
Lucas M., Prowle M., & Lowth G. 2013. Management Accounting Practices of (UK) Small-Medium-Sized Enterprises (SMEs). Improving SME performance through Management. Accounting Education, Chartered Institute of Management Accounting 9(4): 1-14.
Lukka, K. & Granlund, M. 1996. Cost accounting in Finland: current practice and trends of development. The European Accounting Review, 5: 1-28.
Maduekwe, C.C., & Kamala, P., 2016. The use of budgets by small and medium enterprises in Cape Metropolis, South Africa. Problems and Perspectives in Management, 14(1)
Manyani, O. 2014. An investigation into venture financing. A case study of Small to Medium Scale Enterprises in Bindura urban, Zimbabwe (2013-2014). Elite Research Journal of Accounting and Business Management, 2(2):10-25
Maseko N., & Munyani 2011. Accounting Practices of SMES in Zimbabwe: An Investigative Study of Record Keeping for Performance Measurement (A Case Study of Bindura). Journal of Accounting and Taxation, 13(8):171-181
Mitchell, F. & Reid, G. 2000. “Problems, Challenges, and Opportunities: Small Business as a Setting for Management Accounting Research”. Management Accounting Research, 11(4): 385-390.
Mulani, J., Chi, G. & Yang, J. 2015. Effects of the budgetary process on SME’s performance: An Exploratory study based on Selected SME’s in India, Research Journal of Finance and Accounting, 6(14): 135-154.
Neely, A., Bourne, M., & Adams, C. 2003. Better budgeting or beyond budgeting. Measuring Business Excellence, 7 (3):22-28.
Nyanga, T., Zirima, H., Mupani, H., Chifamba, E. & Mashavira, N., 2013. Survival of the vulnerable: Strategies employed by small to medium enterprises in Zimbabwe to survive an economic crisis. Journal of Sustainable Development in Africa 15(6).
Ojua M.O. 2016. Strategic Management Accounting Practices among Indigenous Nigerian Manufacturing Enterprises. Open Science Journal 1(2):1-9
RBZ. (2016). Developmental SME projects intervention to support the youth, women and other disadvantaged groups. Harare: RBZ.
Szychta, A. 2002. The scope of application of management accounting methods in Polish enterprises. Management Accounting Research, 13: 401-418.
Wu, J., Boateng, A. & Drury, C. 2007. An analysis of the adoption, perceived benefits, and expected future emphasis of western management accounting practices in Chinese SOEs and JVs. The International Journal of Accounting, 42: 171-185.
Yoshikawa, T. 1994. Some aspects of the Japanese approach to management accounting‘, Management Accounting Research, 5: 279-89.
Published
2021-07-07
How to Cite
Dlamini, B., & Schutte, D. P. (2021). An exploratory study on the usage of Management Accounting Practices among Small and Medium Enterprises in Zimbabwe.: Array. The Journal of Accounting and Management, 11(2). Retrieved from https://dj.univ-danubius.ro/index.php/JAM/article/view/861
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