How Can Management Accounting Contribute to Risk Management Strategies Within Organization Case Study of Small and Medium Enterprises: Evidence from Emerging Countries

Abstract

Purpose: Current study aimed at exploring the impact of management accounting in supporting risks management strategies within Small and Medium Enterprises in Jordan and GCC countries during the fiscal year 2021-2022. Theoretical framework: Competency of management accounting was chosen as the independent variable which included (Strategic Management, Professional Ethics and Values, Reporting and Control, Leadership, Technology and Analytics, Business Acumen and Operations), while the variable of risk management strategies was chosen to be the dependent variable. Design/methodology/approach: Through quantitative approach and distributing a questionnaire on (257) financial and accounting managers within Small and Medium Enterprises in Jordan and GCC countries. Findings: Based on screening the data through SPSS; results of study was able to identify and accept the main hypothesis which argued that "Management accounting competency has a statistically positive influence on risk management strategies within Small and Medium Enterprises in Jordan and GCC countries " with R= 0.877 and a variance of influence that reached 76.9%. As for sub-variables, it was seen through statistical processing that business acumen and operations and leadership were the most influential variables on risk management strategies with a high variance that indicated a statistical influence of 72% and 42.3% respectively. Research, Practical & Social implications: Study recommended developing and increasing awareness of the importance of management accounting in organizational risk management by promoting the comprehensive and integrated perspective and abandoning the individual perspective of management accounting in the organization; further recommendations were presented in the study. Originality/Value: These finding could be used as a reference for Small and Medium Enterprises in Jordan and GCC countries

Risk Management: The Awareness of Public Managers on Risk as a Social Construction

“…Issues and discussions regarding risk management (RM) in the media and accounting literature have become increasingly intense since the 2008 global financial crisis (Beasley et al, 2015;Braumann, 2018;Braumann et al, 2020;Hashem & Hashem, 2023;Kulinich et al, 2023). RM issues are closely related to control commonly practiced by academics and practitioners (COSO, 2017;The Institute of Risk Management, 2012), and it also has consequences for budgeting (Arena & Arnaboldi, 2013).…”

“…First, based on previous research, the traditional view is that RM has been interpreted and acted upon as mere compliance (Hashem & Hashem 2023;Mahama et al 2023;Vasileios & Favotto 2022). RM is only seen as a 'box ticking' exercise that has no impact on the day-today activities in an organization, other than to meet external needs regarding internal coherence (Soin & Collier, 2013).…”