Gary Oliver - Managerial Accountant’s Compass: Research Genesis and Development

Having been a managerial accountant in industry, government and the education sector for over 30 years, I found they all had one thing in common. The everyday expectations that my manager had of me were always different from what I was told when I was hired. (The expectations of non-accountant managers were also different to what my hiring manager had outlined.) This was not an error in specifying my role and responsibilities. Nor was it an error in distinguishing between different levels of managerial accountant duties, although this frequently played a part. The symptoms of the problem were being asked for information well beyond the terms of reference I had been given for a task or project, being asked ad hoc questions on totally unrelated matters in cost and managerial accounting, and being assigned to fix problems left unresolved after earlier attempts by other managers. Sitting in meetings with other managerial accountants, I found the same was true for them.

In the tradition of self-help, I started tentatively assembling my own answer to this problem, always expecting to find a book or article that described the problems I had witnessed and setting out a systematic solution. I began with the history of the profession but found little of use. Outside it, there were some promising lines of enquiry. Systems and cybernetics asked for interrelationships to be considered (e.g., Checkland, 1999). Neurolinguistic programming used language and other types of communication to enable a person to recode brain responses to stimuli (Bandler & Grinder, 1989). Social complexity theory emphasized starting points, emergent phenomena, and chaos (Waldrop, 1992). At the same time, I was asking others what criteria they used, and that become the first generation of the managerial accountants compass.

Eventually, when I began teaching managerial accounting to postgraduate students in 2009 using case studies, I revised the original analytical framework then called the managerial accounting compass. The third generation is described in this book based on classroom experience and feedback from colleagues. Its emphasis changed from accounting to accountants to orient new managerial accountants to their role and responsibilities so they can make use of their skills and abilities. Contact the author for supplementary materials at: managerialaccountantscompass.mail.com.

The managerial accountants compass combines immediate concerns and the context for planning the future to guide thinking. Thinking spans a range: critical or evaluative thinking, creative thinking, problem solving, and decision making. The managerial accountants compass can help new and old managerial accountants make sense of their role and responsibilities to their employer and the wider society. The author welcomes constructive feedback. Contact address: .

Many thanks to the staff at Routledge associated with this book for their wholehearted support. David Varley enthusiastically accepted the manuscript and guided its revision. Megan Smith handled the paperwork very ably. Mary Del Plato was patient while the argument was refined. Chris Mathews ensured excellence in the production. The structure and content of the entire book has benefited from the comments of the anonymous reviewers.

Note: Suffix d denotes definitions. Page numbers in bold indicate tables. Page numbers in italic indicate figures.

abilities

absorption costing

abstraction

accounting equation d

Accounting Information System (AIS)

accounting period

accounting treatment

acquisition

activity

activity-based costing

advice

Agency Dilemma see

aggregating information

AIS see

alliance

Amortization

analysis

analytical framework

assumptions

attribution theory

average cost

barriers to entry

barriers to self-care

batch-level cost

behavioral accounting

behavioural consequences

belief systems

benchmark

benefits exceed costs principle

black swan event

borrowings

boundary

boundary systems

d bounded rationality

brainstorming

breakeven

breakthrough

broad average costing

budgetary slack

business life-cycle see

capability

capacity

capital budget

capital cost

capitalism

capitalization see

cash flow

center compass point see

channel

classifications

codification

cognitive bias

collegiate relationships see

committed cost

communication

competence

competitive advantage

completion time see

compliance

concepts

conceptual framework

confidentiality

conservative

constraint

consumer choice theory

context

context: geographical factors

context: industry characteristics

context: organization characteristics

context: trends and particular events

contingency

contract

control

controllable cost

conversion cost

core competency

corporate backing

cost allocation base

cost assignment

cost behavior

cost category

cost center

cost classification by behavior and function

cost hierarchy

cost object

d cost of goods manufactured

cost of goods sold

cost of quality

cost pool

cost reduction

cost relationships d

cost responsibility

cost standards see

cost structure

cost-volume-profit

creative accounting

creativity

credibility

critical success factor

CSF see

culture

curvilinear cost

customer

customer relationships see relationships with customer and supplier

customer value

cycle time

decision

decline

degree of managerial influence

demand and supply

department see

depreciation

differential cost

direct cost

direct labor cost

direct material cost

disaster

discourse

discretionary cost

discursive perspective see

disruptive innovation

distinctive competence

distribution (function)

distribution channel see

division see

double-loop learning

drill down

Duopoly

duration

duties

dynamic capability

dysfunctional decision

East compass point see

economic event

economic sector