ABSTRACTThe general objective of the study is to the study is to examine the impact of management accounting practices on the performance of manufacturing firms in Ghana using manufacturing/producing firms in the Asunafo North municipality as a case. The approach to the study is quantitative with emphasis on cross-sectional and …
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ABSTRACTThe general objective of the study is to the study is to examine the impact of management accounting practices on the performance of manufacturing firms in Ghana using manufacturing/producing firms in the Asunafo North municipality as a case. The approach to the study is quantitative with emphasis on cross-sectional and exploratory strategies. The population came from the CEOs of the various firms in the Asunafo North Municipality of the Ahafo Region. In all 21 firms operate in the municipality, giving a sample size of 42 CEOs and one key management staff. Convenience and purposive sampling techniques are used to select the respondents. Questionnaires are used to gather data from the respondents, and analysed using quantitative statistical tools (descriptive and inferential). The study revealed that firms used MAP tools such as budgeting, cost volume profit analysis, costing (product costing) and working capital expenditure measures frequently in their business operations. However, MAP tools including standard costing variance analysis, performance management and evaluation, and decision support systems tool are occasionally used by the firms in their line of operations. Meanwhile, responsibility centers/accounting, and capital expenditure appraisal techniques are rarely used by the firms. The factors that influence management MAP decisions include professional experience of the owners or management, the nature of firm’s operations, the financial position of the firm, owners or management educational background, availability of MAP technology for use, whilst the lowest ranked factor is competition in the market. The adoption of MAP tools in their business, the study revealed that level of performance, the firm’s level of productivity, product quality, the number of deliveries on time, Sales growth of the firm, the firms’ operating profit growth rate, and cash flow growth. the adoption of MAP has helped management to plan the future strategies and operations of the firm, to control current activities, to improve internal and external communication, to measure and evaluate performance, and lastly reducing subjectivity in the decisions in decision making process. Major challenges confronting firms adopting MAP tools in their business operations include huge cost of acquiring the MAP software, training personnel and other cost, unavailability of the MAP software to use, the complex nature of MAP, needing special skills to implement which they don’t have, lack of support from top management/owners in terms of time, resources and personnel. The study recommends to AGI and the firms in Ghana to endeavor to adopt MAP tools in their business operation to derive the benefits associated with such as tools by helping management to plan the future strategies and operations of the firm, to control current activities, to improve internal and external communication, and to measure and evaluate performance. Key words: Management Accounting Practices, financial performance, costing, budgeting.
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