Summary
Management Accounting - Summary + FAST COURSE on every scientific article
- Course
- Institution
Including all the papers from the year 2022
[Show more]
Seller
Follow
Jay1999
Reviews received
Content preview
Paper 1: Business modellingTerpstra and Verbeeten (2014), customer satisfaction: Cost driver or value driver?
ABSTRACT
Customer satisfaction
- Value driver (consider benefits)
- Not cost-free (consider costs)
Research questions
- What is the impact of customer satisfaction on customer service costs?
o Higher service costs: contact costs, providing information, investment
in IT.
- What is the impact on short-term profitability?
o Unclear whether it leads to improved financial performance in the short
run.
- What is the impact on long-term value?
o In addition, the analysis of acquisition patterns in the financial services
industry suggests that customers buy low-risk assets (e.g., savings
accounts) first and more risky assets (e.g. pension funds, mortgages)
in the long run. If you manage to hold on longer to your customers their
long-term value is likely to increase.
Increase in customer satisfaction has most impact on customer
value for high profitable customers.
Customer satisfaction leads to higher
- Future customer switching costs
- Future customer value (=financial performance over three years)
- Customer satisfaction has higher return for most profitable segments.
- Long-term benefits > higher service costs
Paper 2: Financial and non-financial measures in reward contract.
Tahir et al. (2019) Getting compensation right – the choice of performance measures
in CEO bonus contracts and earnings management
ABSTRACT
- Less income increasing manipulation when NFPMs and FPMs are used.
- Less discretionary accounting when using long-term performance measures.
Research questions
- Does the use of non-financial measures in reward contract lead to a more
long-term orientation of managers?
o Including non-financial measures in reward contracts decreases short
termism.
Less earnings management: both accrual based and ‘real’
earnings management. The managers care more about the
long-term well-being of the company, so short-term earnings
management does not benefit the long-term success.
Similar effect for long-term measures.
- Do they make less dysfunctional decisions?
o Less amount of strategic behavior to increase short term performance.
,Managerial implications
- Does the firm want to stimulate short-term or long-term performance?
- Change the weight on financial and non-financial measures to create the right
focus?
Paper 3: Decision making and the BSC
Rotaru et al. (2020). Causal inference in judgment using the balanced scorecard.
ABSTRACT
- The presentation of strategic objectives and the performance outcome
patterns interact significantly, affecting performance evaluation outcomes.
- Violation of the causal independence assumption (VCIA).
The presentation of strategic objectives:
- Generic
- Strategic objectives list
Making decisions based on 16 different measures in a balanced scorecard is
complex
- Results show that subjects focus more on the results of ‘outer’ perspectives.
o The outer perspectives are ‘Learning and Growth’ and ‘Financial’.
o The inner perspectives are ‘Internal Business Process’ and ‘Customer’.
- Adding strategy maps strengthen this effect.
Research questions
- Do decision makers over or under use certain perspectives?
o Yes (outer), especially when a generic map is used. This is the VCIA.
Tendency to attribute greater weight to root cause and ultimate effect.
Implications
- Cost benefit analysis in assigning performance measurement system.
- BSC leads to use of more diverse information.
- However, risk of information overload.
,Paper 4: controllers and their fiduciary duties
Eskenazi et al. (2016). Why controllers compromise on their fiduciary duties: EEG
evidence on the role of the human mirror neuron system.
ABSTRACT
- Positive association between controllers’ mirror neuron system functionality
and their inclination to yield to managerial pressure.
- Specifically for scenarios in which managers pressed their controllers out of
personal rather than organizational interests.
Human mirror neuron system (HMNs)
- Automatic mimicking of emotional facial expressions.
- Stable personal trait.
- Explains why some people are more receptive and responsive to others’
feelings.
Research question
- Is this ability biologically driven?
o Neurobiological characteristics are involved in financial reporting.
o hMNS functionality is positively related to people’s ability to recognize
and care for people’s feelings.
Functional role versus local role
- Dual role controller leads to role conflict which increases the likelihood of
manipulation.
Paper 5: differences between accounting and finance educated CFO’s
Hoitash et al. (2016). Do accountants (or finance) make better chief financial officers
ABSTRACT
- High-growth industry (take more risks): CFO invest less in R&D, CapEx and
external financing.
, - Low-growth industry (increase financial discipline): CFO exhibits greater cost-
efficiency.
Research questions:
- Does an accountant CFO take other (less risky) decisions?
o Accountant CFOs are often more conservative in decisions.
- When does an accountant or finance CFO create more value?
o Depends on market circumstances.
Paper 6: CFO versus the CEO
Florackis and Sainani (2021). Can CFOs resist undue pressure from CEOs to
manage earnings?
ABSTRACT
- A measure that captures the ability of CFO resistance.
- Resistance CFOs are less likely to engage in earnings management.
- CFO resistance depends on the strength of CFOs.
- Resistant CFOs are better in
o Mitigating impact of CEO incentives on earnings management.
o Creating higher quality audit committees.
Three measures to proxy for real earnings management:
- Abnormal cashflow for operations
- Abnormal production cost
- Abnormal discretionary expenses
Research questions
- To what extend can the CFO resist pressure from the CEO to manage
earnings?
Depends on:
o Formal power within the company, firm level expertise, personal ties to
other board members, reputation, career concerns, rewards based on
firm performance, professional qualifications.
Corporate governance
Corporate governance structure has important role in reducing risk of financial
manipulations.
- CFO, board structure and strength audit committee.
Paper 7: Digitalization of the budgeting process
Bergmann et al. (2020). Digitalization of the budgeting process: Determinants of the
use of business analytics and its effect on satisfaction with the budgeting process.
ABSTRACT
- The sophistication of the of the data infrastructure is positively associated with
the use of business analytics in the budgeting process.
- The more a company emphasizes the planning function, the greater the
extent to which business analytics is used in the budgeting process.
- Business analytics can help overcome dissatisfaction with the traditional
budgeting systems.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Jay1999. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $11.72. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
54879 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now