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Title: Management accounting practices in the British food and drinks industry
Authors: Abdel-Kader, MG
Luther, R
Keywords: Management accounting practices;Food industry;Survey
Issue Date: 2006
Publisher: Emerald
Citation: British Food Journal, 108(5): 336-357
Abstract: Purpose – This paper investigates and reports on the management accounting practices in the British food and drinks industry. Design/methodology/approach – The data is generated by a large-scale postal questionnaire which was informed by preliminary interviews. Further interviews were carried out to aid interpretation of the responses. Descriptive statistics on the importance and frequency of use of individual practices provide the basis for discussion. Findings – Direct costing is widely practised and important, by contrast with activity-based costing and full absorption costing. Despite the limitations of conventional budgets, they remain a central management accounting 'pillar' and are frequently used in 'what if?' analyses. The balanced scorecard and other non-financial performance measures are perceived to be important but never or rarely used by 40% of companies. Product profitability analyses are frequently applied, and, surprisingly, the profitability of supplying individual customers is frequently calculated by over 50% of the population. Respondents were sceptical about sophisticated DCF investment appraisals. Practical implications – Traditional management accounting is 'alive and well' but there are indications of likely increased use of: information concerning the cost of quality; non-financial measures relating to employees and analyses of competitors' strengths and weaknesses. There is evidence of a gap between current textbooks and actual practices. Originality/value – The survey provides a unique detailed examination of actual management accounting practices and an indication of future trends.
ISSN: 0007-070X
Appears in Collections:Business and Management
Economics and Finance
Brunel Business School Research Papers

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