Management accounting change in a subsidiary organisation

Authors: Yazdifar, H., Zaman, M., Tsamenyi, M. and Askarany, D.

Journal: Critical Perspectives on Accounting

Volume: 19

Issue: 3

Pages: 404-430

eISSN: 1095-9955

ISSN: 1045-2354

DOI: 10.1016/j.cpa.2006.08.004

Abstract:

Parent-subsidiary relationships are commonplace nowadays, yet surprisingly there is a paucity of research analysing their dynamics over time. This paper presents a (longitudinal) case study, illuminating the dynamics implicated when a UK chemicals company imposed its systems and rules on a new subsidiary. Drawing on observations from a longitudinal case study (from 1993 to 2001), the study considers: (1) the extent to which a parent imposes its (management accounting) systems, rules and procedures on a subsidiary; (2) the role which (local) political, cultural and institutional factors in a subsidiary play in shaping the dynamics of such change implementation; (3) how new systems and practices become accepted and take root as values and beliefs and how they supplement earlier norms? The study provides insight for the questions above, and draws on institutional theories and a power mobilisation framework to assist in the interpretation of observations. We find that the operations of the subsidiary company are influenced by inter-related forces, both inside and outside the organisation encompassing issues of power, politics and culture. As such, existing institutions in a subsidiary organisation are influenced, sustained, and changed by the socio-economic context in which the subsidiary is located. Organisational practices designed to secure external legitimacy are not however always symbolic and decoupled from internal operations. © 2006 Elsevier Ltd. All rights reserved.

Source: Scopus