The mediating effect of management accounting system on the relationship between competition and managerial performance

Abstract

Purpose

This study aims to examine the effect of interaction between market competition and management accounting system (MAS) characteristics on managerial performance. Scope of the study is concentrated on Iranian financial organizations and managers of these organizations were identified as respondents for the questionnaire survey.

Design/methodology/approach

This study used the SmartPLS to analyze the data, and the model of the study was estimated with structural equation modeling (SEM). It follows the recommended two-stage analytical procedures of SEM: assessing confirmatory measurement models (factor analysis) and confirmatory structural models (path analysis).

Findings

The study uncovered the existence of direct relationships between competition and MAS, and between MAS and managerial performance. The study also confirmed that the relationship between competition and managerial performance is mediated by MAS.

Research limitations/implications

The findings provide valuable insights to guide managers in financial organizations to improve their performance through suitable MAS by considering internal and environmental factors. Recommendations on how to improve MAS and managerial performance are provided accordingly.

Originality/value

Prior researches confirm that there is no unique and universal MAS for all organizations, as this depends on internal firm characteristics and environmental features. However, there has been a lack of empirical evidence on MAS researches in the service organizations.

Citation

Ghasemi, R., Azmi Mohamad, N., Karami, M., Hafiz Bajuri, N. and Asgharizade, E. (2016), "The mediating effect of management accounting system on the relationship between competition and managerial performance", International Journal of Accounting & Information Management, Vol. 24 No. 3, pp. 272-295. https://doi.org/10.1108/IJAIM-05-2015-0030