Bài viết này nghiên cứu tiến hành tổng hợp và đề xuất mô hình nghiên cứu cho các nghiên cứu thực nghiệm trong tương lai về các nhân tố ảnh hưởng đến việc áp dụng kế toán trách nhiệm ở Việt Nam. Để hiểu rõ hơn mời các bạn cùng tham khảo nội dung chi tiết của bài viết này.
Trang 1PROPOSING A MODEL OF FACTORS AFFECTING THE APPLICA-TION OF RESPONSIBILITY ACCOUNTING IN ENTERPRISES
ĐỀ XUẤT MÔ HÌNH NGHIÊN CỨU CÁC NHÂN TỐ
ẢNH HƯỞNG ĐẾN VIỆC ÁP DỤNG KẾ TOÁN TRÁCH NHIỆM TRONG DOANH NGHIỆP
MA Chu Thi Huyen - Ass Prof.Dr Pham Duc Hieu
Thuongmai University
chuthihuyendhtm@gmail.com
Abstract
Vietnamese economy has been constantly integrating into the world The integration process has created opportunities but also posed many difficulties and challenges Therefore, local enterprises are searching for effective management tools that assist them in making deci-sions One of the key management tools is responsibility accounting (RA) RA is an effective gov-ernance tool to execute control over both financial and strategic aspects, strengthen sustainable development of enterprises in integration stage However, the application of RA in enterprises depends on many internal and external factors By reviewing previous research, the authors syn-thesize and propose a research model for future empirical studies on factors affecting application
of RA in Vietnam
Keywords: Responsibility accounting, Influencing factors, Enterprises, Vietnam
Tóm tắt
Nền kinh tế Việt Nam đã và đang ngày càng hội nhập với nền kinh tế thế giới Quá trình này đã tạo ra nhiều cơ hội nhưng cũng đặt ra không ít những khó khăn, thách thức Bối cảnh đó đặt ra cho các doanh nghiệp Việt Nam phải nghiên cứu các công cụ quản lý hiệu quả nhằm phục
vụ cho việc ra quyết định Một trong những công cụ quản lý quan trọng đó là kế toán trách nhiệm.
Kế toán trách nhiệm là một công cụ quản lý hiệu quả nhằm thực hiện việc kiểm soát trên cả góc
độ tài chính và chiến lược, tăng cường sự phát triển bền vững cho các doanh nghiệp trong giai đoạn hội nhập Tuy nhiên, việc áp dụng kế toán trách nhiệm trong doanh nghiệp phụ thuộc vào rất nhiều yếu tố cả bên trong lẫn bên ngoài doanh nghiệp Qua tổng hợp các nghiên cứu tiền nhiệm, nhóm nghiên cứu tiến hành tổng hợp và đề xuất mô hình nghiên cứu cho các nghiên cứu thực nghiệm trong tương lai về các nhân tố ảnh hưởng đến việc áp dụng kế toán trách nhiệm ở Việt Nam.
Từ khoá: Kế toán trách nhiệm, các nhân tố ảnh hưởng, doanh nghiệp, Việt Nam
1 Introduction
In the context of international economic integration, businesses have realized that for better decision-making they should rely on advanced management techniques Among them, the one that helps businesses develop sustainably is responsibility accounting (RA) (Nguyen, 2017; Tran,
Trang 22017; Meda, 2003) RA is a management control system based on the principles of delegating authorities and assigning responsibilities in an enterprise The authorities and responsibilities are delegated to managers of different responsibility centers (i.e investment center, revenue center, cost center, and profit center) Therefore, RA is expected to provide financial and non-financial information useful for evaluating managers or heads of departments performance on what is under their control The primary objective of responsibility accounting is to motivate managers and their subordinates by emphasizing their performance
Starting with Higgins’ research in 1952, RA is an interesting research topic for more than
70 years Research findings show that RA has made a significant contribution to the success of businesses operating in different fields around the world, such as manufacturing (Lin and Yu, 2002; Akenbor et al., 2013), bank industry (Pajrok, 2014; Hanini, 2013), and healthcare services (Nyakuwanik et al., 2012; Karasioglu et al., 2012) However, not all businesses can successfully apply RA In Vietnam, RA is still a new concept in both theoretical and practical aspects and not widely adopted by local companies Recently, some empirical researches try to provide and ex-plain the reasons for the late adoption of RA in Vietnam However, the findings are contradictory and lack of generalization due to the absence of a stable research framework Therefore, this is the main reason that motivates the authors to develop a research model on factors affecting the application of RA in Vietnam The main purpose of this paper is that the proposed research frame-work will be tested by empirical studies in Vietnam in order to recognize the facilitating factors for the adoption of RA in Vietnamese firms in the coming time
The paper is structured as follows The next section presents theoretical framework that considers as foundation for RA development The third section is literature review and research hypothesis development, followed by the proposed research framework for studying factors af-fecting RA application in Vietnam Finally, the paper concludes with conclusions and directions for future research
2 Theoretical framework
2.1 Agency Theory
Agency theory refers to shareholders, ‘the principals’, and managers, ‘the agents’, and the relationships between them, which can be defined as a contract between these parties, or dele-gating some decision-making authorities from the principals to the agents in order to perform some services on their behalf (Jensen and Meckling, 1976)
Since the interrelationship among the shareholders and managers of a company fits the definition of an agency relationship, two problems are associated with agency relationships Firstly, there exists the conflict of objectives between the agent and the principal as each party chooses its actions optimally in regard to its self-determined goals (Ince, 1998)
Secondly, the differences in the propensity to accept risk between each party (Haniffa, 1999) The principals who are not directly involved in the running of the business cannot observe the agents’ actions, and always feel that they are at a disadvantage compared to the agents, who have access to more information (Haniffa, 1999) Principals also need to determine whether the agents’ efforts are being discharged in a self-interested way or whether they are acting in an
Trang 3eth-ically and socially responsible way (Mangos and Lewis, 1995) This may raise concerns that the agents will take advantage of their position to maximise their self-interests at the expense of the principal (Beaver, 1981)
To reduce information asymmetry and conflict of interests, managers try to prove their commitments to shareholders by maintaining effective mechanisms of control within a business
In this perspective, RA helps managers in practicing this control However, the decentralization will also create information asymmetry and conflicts of benefits between responsibility centers
As a result, RA promotes the reporting and performance assessment mechanisms Therefore, it can be concluded that the agency theory explains not only the responsibilities of managements
to shareholders but also explains the responsibilities of different managers inside a company In fact, to fulfill commitments to shareholders, managers instead of doing by themselves, intelli-gently delegate authorities and assign responsibilities to their subordinates at different manage-ment levels The establishmanage-ment of the responsibility centers in the company proves an effective way to get the company’s target objectives set by the shareholders
2.2 Contingency theory
The foundations for the contingency theory evolved from the research of Burns and Stalker (1961), Lawrence and Lorsch (1967), Thompson (1967), and Woodward (1965) These re-searchers discovered that organizational performance and effectiveness can be influenced by how well an organization fits its characteristics to the contingencies it faces (Covaleski et al., 2003; Donaldson, 2001, Pleshko, 2007; Rant and Rozman, 2008) A simplified definition of a contin-gency is a changing variable that is beyond the control of the organization (Thompson, 1967) The contingency theory further expands this definition to include any variable that moderates the effect of an organizational characteristic on organizational performance (Donaldson, 2001) The most prevalent contingencies in empirical research include business environment (Burns & Stalker, 1961), organization size (Child, 1975), organizational strategy (Chandler, 1962), and technology (Thompson,1967) Additional contingency factors such as competition, produc-tion type, degree of centralizaproduc-tion/decentralizaproduc-tion, and product diversity may influence an or-ganization (Malmi, 1999; Zhou et al., 2007)
The basic assumption of the theory is that it is impossible to have a common pattern that applies to all organizations The organization’s performance depends on technology, environment, size, features of its distinctive organizational structure and information system of the organizations (Islam and Hu, 2012) Therefore, the contingency theory specifies that organizations should be designed and managed so they are in harmony with the environment (Donaldson, 2001; Freder-icks, 2005; Koo et al., 2007; Lemak and Arunthanes, 1997; Rant and Rozman, 2008) Specifically, the organizational structure should be designed to fit the external environment (Anderson and Lanen, 1999) The proper design of an organizational structure will depend on the level of un-certainty in the environment and the strategic objectives of the company (Husted, 2000) The contingency theory shows that it is impossible to build a RA model applicable to all businesses The application of RA in the business depends on industrial characteristics, production technology, organizational structure, size, and the organizational strategy in each stage, suitable with internal and external environment in which the enterprise is operating
Trang 42.3 Diffusion of innovations theory
Diffusion of innovations theory was developed by Rogers, a communication theorist at the University of New Mexico in 1962 In this theory, diffusion is the process through which inno-vations (new ideas, beliefs, knowledge, programs, technologies or practices) are communicated over time among the members of a social system (Rogers, 2003) Process innovation has been defined as an intentional attempt to bring change and/or new methods of arranging work struc-tures, processes or procedures in organizations, as well as changes in individual and group be-haviors and roles (Damanpour, 1987; West and Farr, 1989) Therefore, the diffusion of an innovation is the spread over time of a new idea through a social system via communication chan-nels (Rogers, 1969)
The theory deals with the processes of diffusion of innovation and a variety of contextual factors influencing the diffusion of innovations in organizations (Rogers, 2003) Rogers (1971), Rogers and Shoemaker (1971) suggested that the innovation diffusion stage is relatively depend-ent on the flow of innovation information and technological know-how This flow is facilitated
by the level of contact between the originators and adopters of innovation, personality character-istics of early adopters, nature of the information flow, and the choice of communication channels They stressed that the best strategy to accelerate the diffusion process is through the identification and involvement of opinion leaders who can be influential early adopters Attewell (1992) clar-ified four factors influencing the decision to adopt innovation: company size, company profits, innovation champions and corporate attributes Research shows that larger firms have more op-portunities to innovate than small firms A more profitable company has more resources and available capacity to undertake the innovations Innovation leaders are motivated to persuade others to adopt a particular innovation Organizational and environmental attributes such as con-centration, functional specialization, expertise and decentralization of the decision-making process that facilitate the adoption of innovation
Applying RA can be seen as an innovation, so it takes time for learning RA is a new tech-nique of management accounting (IFAC, 1998) It is an “innovation” Therefore, the study of the impact of business’s internal factors on the RA application should also be considered This theory proposes two factors that influence the RA application in firms including: (1) the size of the busi-ness; (2) Manager’s factors related to their perception and qualifications
3 Literature Review, Hypothesis Development and Proposed Research Model
Company size: Nowak (2000) and Zimnicki (2015) argue that the company size affects
the definition of responsibility centers They state that besides the size of the company, the types
of centres are affected by the following factors: the scope and specificity of the company’s activity, the complexity of the economic process, and the ability to define the scope of authorities and re-sponsibilities The studies of RaJan (2011) and Alshormaly (2013) conclude that the size of rev-enue, total assets, employees and financial resources have significant influence on RA application Mohamad et al (2014) show that RA is related with the size of an organization It is useful for the large-scale companies, while small-scale companies are not useful as compared to large scale According to Kamilah (2012) and Quesado et al (2016), there is an impact of company size on the application of RA in a firm Research shows that large-scale enterprises, to better manage
Trang 5them, need to implement decentralization and this affects the RA organization in the business Similarly, the studies of Tran (2105), Ngo and Ngo (2018), Le and Pham (2018), Huynh and Ta (2018), Ma and Tran (2019), Tran et al (2020) conclude that organization size has a positive im-pact on the application of RA Inspired from the above studies, the first hypothesis is generated
as follows:
Hypothesis 1: Company size has a positive influence on the application of RA in
Viet-namese enterprises
Enterprise’s characteristics: The establishment of RA depends on characteristics of each
enterprise (Shields, 1995) Nowak (2000) argues that the specificity of business operations is one
of the factors affecting the responsibility centers Meanwhile, the identification of responsibility centers is an important content of RA Research by Venkatrathnam and Reddy (2008) also showed that RA is related to corporate control system because it is based on the principles of authorization and determination of responsibility Similarly, Fowzia (2011) also emphasizes that RA is a control tool under the enterprise’s control system So the control system is a factor that affects RA in an enterprise Nguyen et al (2019) state that we need to use enterprise characteristics to design the
RA system that is suitable and effective when operating control activities for target objectives The divisions of an organization into responsibility centers are based on its operational charac-teristics (Nguyen, 2020) The researches of Nguyen et al (2019) and Bui (2019) show that orga-nization’s operational characteristics affect the application RA of businesses Therefore, the second hypothesis is developed:
Hypothesis 2: Firm’s characteristics have a positive influence on the application of RA in
Vietnamese enterprises
Accountant qualifications: Researches by Haldma and Laats (2002), Alomiri (2003),
Is-mail and King (2007) shows that the accountant’s qualifications are related to the level of RA application in an enterprise The qualifications of accountants are considered as one of the po-tential factors that can affect the organization of RA in the business McChlery et al (2004) claim that qualified accountants helps RA in business growth The study of Nawaiseh et al (2014) also indicated that the insufficiency of employee training programs in managerial accounting in Jor-danian Industrial Companies listed at Amman Stock Exchange was one of the factors hindering the implementation of RA at a very high level, accounting for 74.8% Similarly, the research re-sults of Ern et al (2016) also show that the presence of qualified accountants is related to the high degree of RA application The research results of Nguyen (2015), Tran and Ly (2018), Le and Pham (2018), Huynh and Ta (2018), Ma and Tran (2019), Nguyen and Le (2019) showed that accountant qualifications affect the RA applications From previous results, the next hypoth-esis is formulated as follows
Hypothesis 3: Accountant qualifications have a positive influence on the application of
RA in Vietnamese enterprises
Management decentralization: Vlogel (1962) refers to the construction and establishment
of RA in an enterprise, the author believes that RA should be built on the basis of management decentralization to collect information, implement business control, and provide information for managers to make effective decisions Similarly, Gordon (1963) shows that RA only actives when
Trang 6the business is decentralized and organized The studies of Belkaoui (1981) and Anderson (1995) also state that management decentralization has a significant influence on the application of RA
in an enterprise In 1997, Atkitson et al concluded that RA can only be implemented when the business has a clearly decentralized organizational structure Similarly, by analyzing the factors that influence the RA system, the studies of Casey et al (2008), Fowzia (2009), Fowzia (2011), Smith et al (2012), Nguyen (2015), Ngo and Vu (2017), Ngo and Ngo (2018), Tran and Ly (2018), Huynh and Ta (2018), Nguyen et al (2019), Bui (2019), Ma and Tran (2019), Nguyen (2020) show that management decentralization affects the application of RA in enterprises Hence, the next hypothesis is developed
Hypothesis 4: Management decentralization has a positive influence on the application of
RA in Vietnamese enterprises
Manager’s educational background and awareness: Gordon (1963) argued that if
econ-omists were only interested in economic efficiency without caring about attitudes of subordinate administrators, the RA would not be able to fulfill its inherent role Koske and Muturi (2015) argue that when managers understand the usefulness of RA in performance assessment, the more likely they apply RA for its benefits Shixian (2014) believes that the application of RA in busi-nesses is significantly affected by the training and qualifications of business leaders Nyakuwanika
et al (2012) identify the relationship between the human factors and RA, without the participation
of managers in the design of the RA system, it will not be effective The research results of Nguyen (2015), Tran (2105), Ngo and Vu (2017), Tran and Ly (2018), Le and Pham (2018), Ngo and Ngo (2018), Huynh and Ta (2018), Ma and Tran (2019), Nguyen and Le (2019), Tran et al (2020) show that manager’s educational background and awareness has an impact on the organ-izations of RA As a result, the following hypothesis is formulated as follows:
Hypothesis 5: Manager’s educational background and awareness have a positive influence
on the application of RA in Vietnamese enterprises
Competition: Researches by Hwang (2005), Huang et al (2010) emphasized the need to
consider the level of competition in management accounting in general and RA in particular Ac-cording to Doan (2012), the competition factor implies the extent to which an enterprise have to cope with rivals in terms of sources of raw materials, human resources, product quality, services, prices, distribution channels, and diversity of products The studies of Libby and Waterhouse (1996), Granlund and Lukka (1998), Mia and Clare (1999), and O’Conner et al (2004) state that the keener the competition an enterprise is facing, the more management accounting devices are employed Similarly, Doan’s (2012) conclusion also shows that the competition has profound impacts on strategic management accounting application The studies of Ahmad (2012), Le and Pham (2018) show that competition has an impact on the application of RA in enterprises
Hypothesis 6: Competition has a positive influence on the application of RA in Vietnamese
enterprises
Legal environment: Li (2017) believes that legal environment is an important external
fac-tor and forms a good foundation for the development of management accounting RA is a part of management accounting needs to be flexible in order to adapt to changes in the legal environment (Shields, 1995) Nguyen et al (2019) show that legal environment is one of the factors that affect
Trang 7the performance of animal feed processing enterprises in Vietnam Nguyen (2015), Nguyen et
al (2019) and Bui (2019) believe that the legal environment positively affects organizations of RA
Hypothesis 7: Legal environment has a positive influence the application of RA in
Viet-namese enterprises
From hypothesis development presented above, the factors affecting RA application in Vietnamese enterprises can be summarized on the proposed research model below
(Source: Collected from literature review)
Figure 1: Research model on factors affecting the application of RA in enterprises
5 Conclusions and direction for future research
In the rapid changing business environment, companies are required to utilize all of their resources to pursue competitive advantage RA is a way to gain sustainable competitive advantage
by helping manager have valuable information for making decisions RA can be applied in various organizations However, it depends on numerous factors, such as organization size, accountant qualifications, management decentralization, competition, manager’s educational background and awareness, legal environment, and enterprise’s characteristics
The main aim of this paper is to propose a theoretical model for empirical studies on factors affecting the application of RA in Vietnam In the coming time, the empirical studies will be car-ried out in order to verify the hypotheses generated from proposal research model The findings from empirical studies will be foundations for recommendations to facilitate the application of
RA in Vietnamese enterprises
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