Technological and organizational influences on the adoption of activity‐based costing in Australia

Abstract

The present paper examines one set of potential reasons for the paradox as to why so few firms have adopted activity-based costing (ABC) despite the demonstrated benefits of this costing system. A cross-sectional survey of Australian firms is used to examine the influence of seven technological and organizational factors on firms' initial interest in ABC and their decision to adopt it or not. The organizational factors of top management support, the support of an internal champion, and organizational size were shown to be associated with initial interest in ABC. The decision to adopt or reject ABC had one organizational factor associated with it, the support of an internal champion. Copyright (c) 2004 Accounting and Finance Association of Australia and New Zealand.

Management Accounting Change: ABC Adoption and Implementation

“…However, the researchers have developed various interpretative perspectives to know and highlight the factors affecting ABC adoption and implementation (Shield, 1995;Swenson, 1995;Malami, 1999;Maelah & Ibrahim, 2006) and the stages of its implementation processes (Anderson, 1995;Krumwiede, 1998;Brown, Booth & Giacobbe, 2004). However, most of these studies arrived to ambiguous, different and divergent results.…”

The Impact of Strategic Management Accounting and Cost Structure on ABC Systems in Hotels

“…Many field studies and surveys demonstrated that the adoption of ABC tend to be more frequent in large organizations (Innes and Mitchell, 1995;Bjornenak, 1997;Malmi, 1999;Krumwiede, 1998;Pierce and Brown, 2004;Armitage and Nicholson, 1993;Innes et. al., 2000, Gosselin, 2007Brown et al 2001;Groot, 1999). Α possible reason for this is that larger organizations have relatively greater access to resources to experiment with the introduction of more sophisticated accounting systems.…”

An Examination of the Factors Influencing the Level of Consideration for Activity-based Costing

“…However, this research has been somewhat fragmented because of the different ways in which it has defined the extent to which operating units have or have not adopted ABC (see Brown et al, 2004). This is illustrated below, which shows the different definitions of ABC adoption in research conducted in manufacturing industry.…”

“…Only Booth & Giacobbe (1998), Brown et al (2004) and Krumwiede (1998) have examined the issue of consideration for ABC. (Note 2) Booth & Giacobbe (1998) compared operating units with an interest in ABC (or those who were at least willing to consider it) to those that had not considered ABC.…”

“…(Note 2) Booth & Giacobbe (1998) compared operating units with an interest in ABC (or those who were at least willing to consider it) to those that had not considered ABC. Brown et al (2004) compared operating units that had shown an interest in ABC by either currently considering it or having considered it with those that had not considered it. The problem with this approach, however, is that it assumes that operating units with an interest in ABC are a homogeneous group.…”