A conceptual framework for teaching management accounting. (September 2018)

• Record Type: Journal Article
• Authors: Samuel, Sajay
• Is Part Of: Journal of accounting education. Volume 44(2018)
• Page Start: 25
• Page End: 34
• Publication Date: 2018-09
• Subjects: Management accounting -- Conceptual framework -- Organizational economics; Accounting -- Study and teaching -- Periodicals; Accounting -- Study and teaching -- United States -- Periodicals; Comptabilité -- Étude et enseignement -- Périodiques; Comptabilité -- États-Unis -- Étude et enseignement -- Périodiques; 657.0711
• DOI: 10.1016/j.jaccedu.2018.05.004
• Languages: English
• ISSNs: 0748-5751

Abstract

Highlights: Conceptual framework for teaching management accounting. Contrasting organizations to markets to derive the toolkit of managerial accounting. Strategic decisions based on management accounting informs organizational boundaries. Theoretically informed conceptual framework can help professionalization of management accounting. Abstract: This paper proposes a conceptual framework for teaching management accounting. The framework is rooted in distinguishing organizations from markets and draws on the fast-developing field of "organizational economics." Market clearing prices, infinitely divisible commodities, and regime of private property rights are three aspects that can theoretically characterize market transactions. This paper argues for conceptualizing the subject matter of management accounting as a response to the relative absence of these aspects of market transactions within organizations. Specifically, management accounting procedures can be classified as instruments that: coordinate the demand and supply of resources in the absence of prices; measure resource consumption given indivisibilities in the cost function; and control resource use when the ownership of assets is separated from its control. This conceptual framework not only lends intellectual coherence to the subject matter of management accounting but also permits its diverse topics to be arranged in a logically articulated manner.