This study draws on both contingency and contracting theory to examine the moderating effect of perceived environmental uncertainty (PEU) on the relationship between the use of management accounting system (MAS) and managerial performance in Finnish companies. The responses of 69 managers, drawn from Finnish companies. to a questionnaire survey were analysed using a moderated regression analysis (MRA). The results found support for the hypothesis that the effects of MAS on performance were dependent on PEU. Under high levels of PEU, sophisticated MAS had a positive effect o n performance. but under low levels it had a negative effect. Additional analysis showed that PEU interacts with different variations of MAS to influence performance.

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Purpose -First, this paper aims to provide empirical evidence of the interaction between the components of an internal control system. Second, it seeks to integrate work from the field of strategy and that on the internal control system from the field of auditing. The purpose of this paper is to enable a more profound understanding of how different strategic orientations may influence effectiveness, depending on the components of the internal control system. Design/methodology/approach -Data were collected through an online questionnaire and analyzed using multiple regression analysis, i.e. a three-way interaction model. The result was a usable sample of the opinions of 741 managers working in Finland. Findings -The results indicate that, for prospector firms, high degrees of internal control activity and low degrees of monitoring ensure a greater effectiveness of the internal control system. On the other hand, for analyzers a high degree of internal control activity and high degrees of monitoring lead to a highly effective internal control system. In addition, our findings indicate no significant differences between defenders and analyzers.Research limitations/implications -The research is limited to only two components of the internal control system, namely, internal control activities and monitoring. Future research is needed to examine the interactions of other components of the internal control system. Practical implications -The paper demonstrates the need for managers to be aware of the drivers of the effectiveness of the internal control system and the relationships essential to drive effectiveness, especially when operating in different strategic fields. While all components of an internal control system are vital, this study shows that a good fit between them can lead to improved effectiveness. Originality/value -This is the first empirical study that has used a three-way interaction method to study internal control structures and their effectiveness in an organizational context. Coupled with previous work, it suggests the need for both researchers and practitioners to examine the interactions of an internal control system and how they impact on the effectiveness of that system.

Purpose -This study aims to examine the combined effect of the interactive and diagnostic management accounting system (MAS) use and organizational culture on performance. Using the contingency perspective, this study suggests that the performance is enhanced by the interaction of organizational culture and the simultaneous use of both types of MAS. Design/methodology/approach -Data were collected through a questionnaire, and responses from 147 senior managers provide support for the research model and demonstrate that each type of organizational culture requires different combinations of both types of MAS uses to enhance performance. Findings -The results of the study indicate that although both uses of MAS are required, highest performance for flexibility value firms is achieved when high interactive and low diagnostic MAS use is employed. On the other hand, for control value firms, this study indicates that using both high diagnostic and interactive MAS creates a positive effect on performance. Research limitations/implications -As in the case of most survey empirical studies, this study is static and may not capture the changes in organizational culture over time. To prevent this bias, longitudinal follow up studies would be required. Second, the self-report data may be affected by common method bias. Practical implications -The present study indicates that managers should be aware of the dominant values of their organization cultures before deciding to use MAS in a specific way, and thus contributing to the effectiveness of organizations when both interactive and diagnostic are employed simultaneously. Originality/value -The results of the present study increase extant knowledge and understanding on the knowledge of the relationships between organizational culture and the use of MAS and how they influence performance. This is important because there are few empirical studies that have examined organizational culture using the competing values framework.

PurposeThe purpose of this paper is to investigate the relationship between perceived environmental uncertainty (PEU), supplier development (SUD) and the use of broad scope management accounting systems (MAS) information. In recent years, many companies have come to recognize the important role supply chain purchasing strategy plays in achieving competitive advantage. One of the key components of the supply chain purchasing strategy is supplier development. In addition, there have been calls for research into how changes in supply chain management affect the use of MAS.Design/methodology/approachAbout 78 managers from different organizations participated in this Finnish study. Using operations management and accounting literature, four hypotheses were proposed in the study. Data were collected from managers using a mail‐out questionnaire.FindingsThe results revealed that PEU is a determinant of SUD, which, in turn, is a determinant of the use of MAS. In other words, SUD plays a mediating role in the relationship between PEU and the use of broad scope MAS information.Research limitations/implicationsThis paper describes the responses from 78 managers in medium to large size manufacturing firms in North‐Western Finland and consequently a caveat about generalizability is appropriate notwithstanding the high‐global esteem of Finnish manufacturing.Practical implicationsThe competitive production environment that exists today has forced many firms into lean production. This paper suggests that under such conditions of uncertainty the incorporation of SUD data into the MAS may prove very salutary.Originality/valueThe findings of this paper should prove useful to firms entertaining an upgrade and broadening the scope of their MAS to include supply chain management information, particularly as it relates to supplier development.