The influence of trust, communication and commitment on ethical behavior in universities: a case of South Africa

Abstract

Abstract

Factors affecting the adoption of activity-based costing in a South African state university

“…Studies have shown that the traditional organisational structure hinders effective communication on ABC between departments and other areas of the organisation. For instance, Madwe et al (2020) and Naidoo (2011) suggested that conventional hierarchical structures make it difficult for employees to understand the importance of ABC and its implications for their work.…”

“…Budgetary constraints associated with freezing of fees, government-regulated tuition increases and limited government funding (Aislinn 2015;Su et al 2021) have increased the pressure to reform cost management strategies in state-funded South African universities (Naidoo 2011). The increased competition for limited government funding now means that proper management of escalating costs as well as being cost efficient is imperative in state universities in South Africa.…”

“…These changes demand more accurate cost allocation techniques. An enhanced costing system, such as activity-based costing (ABC), could be a solution towards effective cost management (Naidoo 2011). Al-Halabi and Shaqqour (2018) defined ABC as an approach to internal cost accounting that involves analysing, recording, controlling and reporting on the costs and wider performance of activities, rather than the traditional narrow emphasis on the costs of departments and cost centres.…”

“…In essence, ABC focuses attention on the costs of various activities required to produce a product or service and assigns these indirect costs to cost objects, such as products or services, based on activities performed for the cost objects (Baird, Harrison & Reeve 2004). Despite these positives, ABC has not yet been widely implemented or adopted in universities (Naidoo 2011). Most studies have focused on ABC implementation in general (Hashim 2015) with some studies focusing on specific sectors, such as life insurance companies (Adams 1996), health institutions (Goldberg & Kosinski 2011), transport companies (Baykasoglu & Kaplanoglu 2008), financial institutions (Baird et al 2004), hotels (James 2013), with most studies highlighting successful application under constrained budgetary conditions.…”

“…There have only been a few studies on ABC implementation in public or state-funded universities (Hashim 2015). In the South African context, studies have focused on Technical and Vocational Education and Training (TVET) colleges (Madwe 2017) and private universities (Naidoo 2011). Literature shows that there has not been an investigation on the factors affecting the adoption and implementation of ABC in South African state universities.…”