A case study to evaluate the utility of accounting reports to operating management
Draudt, Wayne J.
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Management accounting is charged with the responsibility of providing operating management with relevant accounting reports. In meeting this responsibility, the management accountant exposes himself to the world of the behavioral sciences. He must be sensitive to the people for whom he prepares economic information. He must be aware of their informational needs as well as their human needs. It is within this context that this study originated. This study sought to determine whether operating management's willingness to use accounting information was contingent upon their attitude toward accounting personnel, as well as upon the utility and comprehension of the information received. Other factors, such as the biographical background of the respondent, as well as his perceptions of various factors relating to the accounting function, were also analyzed. Data for the study was procured from the circulation of a questionnaire to all operating management personnel within a medium-sized manufacturing firm. The entire operating staff was asked for their evaluation of accounting personnel and the accounting reports they received. The responses which were received were then scrutinized in an attempt to find those variables which displayed a high degree of association. A review of the statistics generated by canned computer programs allowed the following conclusions to be drawn. The degree of association between the willingness to use accounting reports by operating management personnel and operating management's attitude toward accounting management was found to be nonexistent. Although accounting reports were not used to any great extent by operating management personnel, this could not be attributed to their attitude toward accounting personnel. It was found that the accounting management team was held in very high regard by the recipients of their reports. The failure to use these accounting reports was associated, however, with the lack of usefulness of the information, as well as the difficulty in comprehending the information contained in the reports. The non-usage factor was also associated with certain areas of responsibility within the organization, as certain departments tended as a group not to use the reports. It was also found that line management tended to use the reports to a greater extent than staff management personnel.