Strategy-related factors moderating the fit between management accounting practice sophistication and organisational effectiveness: the Global Management Accounting Principles (GMAP) perspective

Abstract

This study examined strategy-related factors (Business strategy, Information technology, Quality of management accounting skills, and Organisational culture) moderating the fit between management accounting practice (MAP) sophistication and organisational effectiveness from the perspective of the Global Management Accounting Principles (GMAP). The GMAP was jointly developed and endorsed by The American Institute of Certified Professional Accountants (AICPA) and The Chartered Institute of Management Accountants (CIMA) to support Chief Executives, Boards of Directors, Chief Finance Officers and Management Accounting Practitioners to benchmark and improve management accounting practices. The study focused on 131 firms across various industries in Nigeria. Analysis of data collected through questionnaire revealed that the two high-ranking factors responsible for the degree of MAP sophistication are business strategy and quality of information technology. It was observed that although business strategy and information technology significantly moderate the relationship between MAP sophistication and Organisational effectiveness, business strategy exerts greater influence. The finding that business strategy strongly moderates the relationship between MAP sophistication and organisational effectiveness connotes that forward-thinking business entities would leverage on the strategy-formulation and strategy-implementation capabilities of contemporary management accounting techniques to drive performance and achieve business imperatives.