Accounting information and managerial work

Despite calls to link management accounting more closely to management (Jonsson, 1998), much is still to be learned about the role of accounting information in managerial work. This lack of progress stems partly from a failure to incorporate in research efforts the findings regarding the nature of managerial work, as well as inadequate attention devoted to the detailed practices through which accounting information is actually used by managers in their work. In this paper I draw on prior research to develop a series of propositions focused on three primary insights into how and why managers use accounting information in their work. First, managers primarily use accounting information to develop knowledge of their work environment rather than as an input into specific decision-making scenarios. In this role, accounting information can help managers to develop knowledge to prepare for unknown future decisions and activities. Second, as accounting information is just one part of the wider information set that managers use to perform their work, it is imperative to consider its strengths and weaknesses not in isolation but relative to other sources of information at a manager’s disposal. Third, as managers interact with information and other managers utilising primarily verbal forms of communication, it is through talk rather than through written reports that accounting information becomes implicated in managerial work. These insights have important implications for how managers use accounting information, and, in particular, require reconsideration of the types accounting information that managers find, or could find, helpful. The paper also considers how existing experimental and field-based methods could fruitfully be adapted to focus on the detailed activities through which managers engage with accounting information. 2009 Elsevier Ltd. All rights reserved. Despite calls to link management accounting more closely to management (Jonsson, 1998), much is still to be learned about the role of accounting information in managerial work. For what purposes do managers use accounting information beyond its role in specific decisionmaking scenarios? With many other information sources on offer, what is it about accounting information that managers find helpful? How exactly is accounting information used by managers in discussions and debates with subordinates and other managers? Over 10 years ago, Jonsson (1998) exclaimed in the title of his paper the need to ‘‘relate management accounting research to managerial work!” Despite Jonsson’s (1998) fervent arguments, future research has generated few studies directed towards understanding howmanagers engage with accounting information in their work. Much management accounting research has been focused on how managers use accounting information to make decisions in well-defined scenarios. Although managers do make decisions, and many of these are undoubtedly important, empirical investigations of what managers actually do show that decision-making is only a relatively small part of managerial work and sometimes not that critical (for example, see Hales, 1986; Kotter, 1982; Mintzberg, 1973; Stewart, 1988; Whiteley, 1985). In addition, much managerial work involves addressing problems that involve turbulence, doubt, uncertainty, and the potential for significant error (Hales, 1986; Isenberg, 1984; Kotter, 1982; Landau & Stout, 1979). As such, a strong focus on 0361-3682/$ see front matter 2009 Elsevier Ltd. All rights reserved. doi:10.1016/j.aos.2009.09.003 * Tel.: +44 (0)20 7849 4633; fax: +44 (0)20 7955 7420. E-mail address: [email protected] Accounting, Organizations and Society 35 (2010) 301–315