Context and change in management accounting and control systems: a case study of Telecom Fiji Limited

Citation

Sharma, U. (2010), "Context and change in management accounting and control systems: a case study of Telecom Fiji Limited", Journal of Accounting & Organizational Change, Vol. 6 No. 2. https://doi.org/10.1108/jaoc.2010.31506baa.002

Context and change in management accounting and control systems: a case study of Telecom Fiji Limited

Article Type: Doctoral research abstracts From: Journal of Accounting & Organizational Change, Volume 6, Issue 2

Purpose – The paper aims to contribute to research in management accounting and control systems (MACS) in a developing country context: that of Fiji. It seeks to gain a theoretical understanding of how MACS reflect the social and political contexts in which they operate by using a case study of Telecom Fiji Limited (TFL) (a major supplier of telephone communications in Fiji). The definition of “MACS” for the purpose of this paper is broad – a social constructivist perspective is adopted in which systems are used to align employee behaviour with organisational objectives and to assist external relationships (with the state, commerce commission, aid agencies and customers).

Design/methodology/approach – The paper adopts a qualitative interpretive approach. In particular, the paper draws on institutional theory while raising questions as to how to refine and extend institutional theory in the management accounting literature. This paper has often been associated with institutional embeddedness (stability). The social constructivist approach helps to incorporate agency and cultural issues normally missing in conventional applications of institutional theory to accounting change.

Findings – TFL is restructured under the Fiji Government’s public sector reforms. Such reforms are insisted upon by the international financial agencies of the World Bank, the Asian Development Bank and the International Monetary Fund. Under the reform policy, TFL is transformed from a government department into a corporatised organisation and is subsequently privatised. The MACS changes, which eventuated helped to change TFL management and employees’ interpretive schemes. However, employees resisted initial changes to commercial business routines and it took some years for TFL actors to assimilate commercial practices.

Originality/value – While the literature dealing with MACS changes has mostly portrayed changes as occurring with little resistance, MACS changes at TFL took several years to become institutionalised, partly because of cultural and political factors specific to Fiji. The paper has practice implications as it shows that management accountants can act as institutional entrepreneurs in organisations, shaping new accounting technologies in reformed entities, and changing actors’ interpretive schemes. The paper has implications for policy makers, consultants and other stakeholders in terms of promoting a need for better understanding of the sensitivity to cultural and political circumstances in less developed countries like Fiji in relation to the introduction of MACS changes. The paper has implications for other recently corporatised/privatised and state-sector organisations in Fiji and elsewhere. It also has implications for other researchers as institutional theory can be refined on the basis of new empirical evidence.

Keywords Management accounting, Control systems, Institutional theory, Culture, Fiji

Research type – Qualitative research

Award Institute – University of Waikato, New Zealand

Supervisors – Professor Stewart Lawrence and Professor Alan Lowe

Contact e-mail: ups@waikato.ac.nz

Department of Accounting, Waikato Management School, University of Waikato, Hamilton, New Zealand

Umesh Sharma