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Comparative Management Accounting

Literature Review on Similarities and Differences Between

Management Accounting in Germanic and Anglophone Countries

Andreas Hoffjan, Professor

WHU Otto Beisheim School of Management, Vallendar

Pascal Nevries, Assistant Professor

WHU Otto Beisheim School of Management, Vallendar

Ren Stienemann, Dipl.-Kfm.

cronos billing consulting GmbH, Muenster


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Comparative Management Accounting

Literature Review on Similarities and Differences Between

Management Accounting in Germanic and Anglophone Countries

This paper compares management accounting practices in Germany, the UK and the USA and

reveals a range of differences and similarities. The most significant difference is in the use of

either the general-ledger concept or the two-circle system. Through following these varying

approaches, further differences arise, e.g., the total lack of imputed costs in the Anglo-Saxon

countries and different bases for calculated profits in Germany. German management

accounting exerts a stronger influence on management, because in the Anglo-Saxon countries

financial accounting figures are not regarded as being useful for internal decision making.

Thus management in Germany relies much more heavily on internal calculations provided by

management accounting. Management accountants in the USA and UK exert a much deeper

impact on operational matters and are involved in broader fields of activity than their German

counterparts. While Anglo-Saxon management accounting is also directed at shareholders,

German management accounting is addressed at internal target groups alone. Apart from

these differences, several important similarities could also be observed. Management

accountants in all three countries have reasonably similar objectives and goals. Among the

most important are the provision of information, participation in the management process and

attempts to ensure rational decision making by management. In general, a converging

approach in management accounting practice is observable.


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1. Introduction

The competitive environment in which companies operate is steadily becoming more

challenging and demanding. Major corporate take-overs increase the demand for more

sophisticated and advanced management accounting information in order to react

appropriately to external market pressures. Multinational companies have to cope regularly

with various different institutional environments, management practices, and cultural

(mis)understandings between the respective countries.

While, in this context, the field of financial accounting has already attracted considerable

attention from the academic world at a comparative international level, the area of internal

management accounting has largely been limited to approaches focussing only on individual

countries. These approaches have been analysed thoroughly by national academic researchers

and, as a consequence, influenced practices in other countries. However, in order to initiate a

debate on the subject and to highlight best practices, as well as innovations and inefficiencies

in the management accounting world, a sophisticated comparison, drawing on the differences

and similarities between the observed countries, has only recently been conducted in the

management accounting literature.

Furthermore, different labels, in different languages, are used to refer to management

accounting around the world (IFAC, 1998: 84). The relatively young discipline of

comparative management accounting attempts to fill this gap in management accounting

research, by determining the degree of diffusion of applied concepts and practices in differentcountries. Divergences should be analysed in order to learn from other language areas and to

understand the approaches used.

The present paper analyses the different characteristics of management accounting in

Germany, the United Kingdom (U.K.) and the United States of America (U.S.A.). The

intention of this paper is to highlight the differences between the observed countries and the

effects they induce.


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The paper is organized as follows. First, we explain the choice of the selected countries

and the methodology used. Section 3 then introduces the general concept of comparative

management accounting. Based on the terminological specification of nationally diverging

definitions of management accounting labels, the following section 4 describes and compares

the main aspects and characteristics of management accounting in Germany, the U.S.A. and

the U.K. Finally, section 5 summarizes the findings.

2. Methodology

The present study concentrates on Germany, the U.K. and the U.S.A. These countries

have been selected due to various reasons. For a start, the U.S.A. is the worlds leading

economic power and thus of fundamental significance with respect to management

accounting. Many countries have been and still are influenced by new developments in

American management accounting (SHERIDAN, 1995: p. 293). Therefore, the inclusion of the

U.S.A. is considered essential in this comparative study. To a lesser degree, this also applies

to the UK. Furthermore both, the U.S.A. and the U.K., continuously influence management

accounting developments in other countries, because English is the dominant language in the

world of business (PISTONI and ZONI, 2000: 311). In addition, it is often claimed that

management accounting has its roots in the U.S.A. and has influenced accounting practices

and developments in German management accounting (Otto, 2000: 25).Secondly, Germany and the U.K., although having seemingly different management

accounting structures and institutions, are among the dominant countries in Europe with

respect to management accounting importance (BLAKE ET AL., 2000: 123). In this context,

many studies have revealed a significant impact of German management accounting on

several other countries in the world (KEYS andMERWE, 1999: 2; BLAKE ET.AL.,2000: 123).

Because the U.S.A. and U.K. can be assumed as being fairly similar due to the common

language, similar financial accounting orientation and the cultural proximity (CARR and


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TOMKINS,1998: 215-6; HOFFJAN and WMPENER, 2006: 238), in this paper, both countries

will be treated commonly as Anglo-Saxon or Anglophone countries, if nothing else is

stated to the contrary.

As comparative management accounting is a relatively young discipline, there are few

studies dealing with this topic (BLAKE ET AL.,2000: 122). In order to provide an overview of

the state of the art in comparative management accounting, the following literature review

identifies current research streams and future research questions. The first step is to develop a

framework for classifying the relevant literature.

The few studies published so far in this field of research do not claim to be representative

of comparative management accounting in general, and also vary with respect to objectives,

timeframe and methodological approaches (STOFFEL, 1995: 1). Nevertheless, some general

tendencies with respect to functional aspects of management accounting can be identified and

will be discussed in this paper.

STOFFELs (1995) study is one of the first to concentrate at length on controllership on an

international level. In his comparative work, STOFFEL analysed controllership in Germany, the

U.S.A. and France.

On a broader inter-country scale, BHIMANI (1996) focussed on differences and similarities

in management accounting in Europe. However, BHIMANI merely collected and published

nation-specific results from eleven European studies without explicitly stressing the

differences and similarities in detail. A similar study from L IZCANO (1996) deals withcomparative management accounting in Latin America.

More recent empirical studies focussing explicitly on the comparative element of

management accounting can be found in AHRENS (1997; 1999), OTTO (2000), ZIRKLER

(2002), JONES andLUTHER (2004) and HOFFJAN andWMPENER (2006).

In order to obtain an overview of the relevant comparative management accounting

literature analysed in this paper, the studies were grouped into six different categories as

presented in Figure 1:


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[Include Figure 1 here]

The categories are ordered with decreasing relevance to our selected countries and

comparative management accounting in general. Following this categorisation, all papers in

thefirstgroup cover the countries Germany, the U.S.A. and / or U.K. and deal simultaneously

with comparative management accounting. In the literature review, 30 papers could be

included in the first category. The second group includes papers that deal with national

management accounting from the respective countries. Although not dealing explicitly with

comparative management accounting, these papers are nevertheless useful for a deeper

analysis. Because they represent the characteristics and particularities of the specific

countries, these papers can be compared to one another.

In the third category, aspects closely related to management accounting are discussed

from the respective country perspective. Topics such as culture do not deal explicitly with

management accounting, but nevertheless have a direct or indirect influence on different

perceptions of accounting in the various countries.

In the fourth category, the comparative element is highlighted again, although these

papers do not deal explicitly with the countries that form the focus of this paper. This

category is included, due to potential cross-references from other countries. If it is possible to

observe how management accounting differs or converges between other countries,

meaningful comparisons could possibly be made.The fifth and sixth categories are included in this categorisation for reasons of

completeness, but are not considered as sufficiently relevant to merit further examination.

3. Principles of comparative management accounting

3.1. Comparative management accounting


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Comparative management accounting compares management practices and principles

between countries and cultures in order to initiate discussion, to highlight best practices,

innovations and inefficiencies in management accounting. Managers can also achieve

competitive advantages by applying innovative management accounting techniques from

other countries or cultures (AMAT ET AL.,1999: 20). Additionally, comparative management

accounting aims at guiding techniques and practices towards convergence (HOFFJAN and

WMPENER, 2006: 241).

3.2. Management accounting versus controlling

Terms like management accounting or controlling are neither equally used nor understood

in all countries (AMAT ET AL., 1999: 19). In Germany for instance, the label management

accountant is not commonly applied as a description of the occupation neither in the

English term nor the German translation (SHERIDAN, 1995: 1; BIRKET 1998: 487).

In order to compare the work of management accountants in the three countries,

equivalences for the corresponding Anglophone meanings must be found. In this respect,

German controlling is generally viewed as similar to the Anglophone management

accounting in the relevant academic literature (SHERIDAN, 1995: 1; OTTO 2000: 38; WILLSON

ET AL., 2003: 5; KPPER, 2005: 6). The discussion of controlling-related problems and

innovations in Anglophone journals like Management Accounting Research, Management

Accounting Quarterly or Advances in Management Accounting can be regarded as anindication of the terminological proximity of German controlling and Anglo-Saxon

management accounting (KPPER, 2005: 6).

Although there is not such a demand for theoretical definitions in the U.S.A. that are

comparable to those used in Germany (Otto, 2000: 25), the following chapter tries to examine

whether deeper differences are identifiable from an initial view of the definition and

terminology of both terms.


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3.2.1. Management accounting terminology and definitions in the U.S. and the U.K.

In the Anglophone literature, it is evident that various terms are used for management

accounting. Labels like internal accounting, enterprise reporting and managerial

accounting are widely used as synonyms for management accounting (ZIRKLER, 2002: 17).

Given these different labels that are used for the same basic concept, AMAT ET AL.(1999: 19)

also observed that the term management accounting implies different meanings across

national boundaries. In general, two different perceptions of the scope of management

accounting can be observed in the relevant Anglo-Saxon literature (MUSSNIG, 1996: 13).

The first perspective defines management accounting from a narrow point of view, such

that the term refers mainly to internal cost accounting and internal calculations (MUSSNIG,

1996: 13; HORVTH,2003: 79).

A second, much broader perspective is more common in the Anglo-Saxon countries.

According to the NATIONAL ASSOCIATION OF ACCOUNTANTS (1981: 4) management

accounting is defined as:

[] the process of identification, measurement, accumulation, analysis, preparation,

interpretation, and communication of financial information used by management to plan,

evaluate, and control within an organization and to assure appropriate use of and

accountability for its resources. Management accounting also comprises the preparation of

financial reports for non-management groups such as shareholders, creditors, regulatory

agencies, and tax authorities.

In this definition, which is characteristic of management accounting in the Anglo-Saxon

countries (MUSSNIG, 1996: 13; Zirkler, 2002: 18) and will therefore be used in this paper, a

clear focus on financial information becomes apparent. Furthermore, it is noteworthy that the

definition includes non-management reporting for taxation and regulatory purposes as part of

management accounting (MUSSNIG, 1996: 13). Management accounting is therefore an


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integral part of the management process. It can be regarded as an umbrella term for the

general managerial process of planning, evaluating and controlling, as well as of reporting.

Another label which is commonly applied in both the U.S.A. and U.K., is the term

controller. WILLSON ET AL. (2003: 11) observe that, for the chief accounting officer (CAO)

especially in large companies, the most common title used is controller. Although the label

controller can therefore be regarded as widespread in the Anglo-Saxon countries, its

application is commonly reserved as a description of the highest-ranking management

accountant in the corporation, rather than for all management accountants. The authors also

acknowledge that, while various titles can be applied to the position of the CAO, the title

controllermay be an unfortunate one, because it emphasises the aspect of control more than

other also relevant responsibilities like reporting, management and planning.

The label controlling also raises some important issues. While the term controller is

commonly applied as stated above, controlling is only used as a description of the leadership

process of the final stage in the managerial decision making process (STOFFEL, 1995: 9;

KPPER, 2005: 6). Therefore, controlling and controller are only similar with respect to the

origin of the term in the Anglo-American countries, but not at the conceptual level

(SIEGWART, 1982: 98; STOFFEL, 1995: 10).

This difficulty concerning the job description of the controller is quite often referred to in

the Anglo-Saxon literature. The modern controller does not do any controlling in terms of

line authority except in his own department (HORNGREN ET AL. 2005: 13; STOFFEL, 1995:10).

Finally, the term controllership rather than controlling most often characterises the field

of activity of the controller or management accountant in the Anglo-Saxon countries (OTTO,

2000: 26).

3.2.2. Management accounting terminology and definitions in Germany


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In contrast to the Anglophone label management accounting, business managers in

Germany generally use the term controlling as a description of the field of activity of

management accountants (BIRKET, 1998: 487; AHRENS and CHAPMAN 2000: 482; KPPER,

2005: 3-.4f). In this context, controlling describes the relatively young discipline of

Betriebswirtschaftslehre (business administration). Contrary to the purely practical approach

in the U.S.A. and U.K., the basics of controlling have been developed within the academic

literature (SCHERRER, 1996: 100; AHRENS andCHAPMAN 2000: 482;JONES andLUTHER 2004:

4; KPPER, 2005: 6) and its definitions and interpretations are characterized by its great

variety and diversity. A widely-accepted definition of controlling in the German literature has,

therefore, not been so far discernible until the present (FREIDANK, 1993: 400).

Nevertheless, it can be observed that the majority of definitions focus on the decision-

support function (BERENS ET AL., 1995: 144), the coordinative function (HORVTH, 2003:

148-9; KPPER,2005:5) or define controlling as safeguarding managerial rationality (WEBER,

2004: 47).

While controlling concentrates more on internal accounting matters, in the Anglo-Saxon

countries, management accounting includes internal as well as external accounting aspects

and can be seen as a general term for accounting as a whole (M USSNIG,1996: 13).

Comparing controlling with management accounting definitions, it can therefore be

argued that, on the one hand, management accounting is defined and understood in a

functional broader context, whereas controlling definitions, on the other hand, are comparablycharacterised by their greater universality (e.g. WEBER, 2004: 48).

Despite this broader scope of management accounting, some similarities are evident. All

definitions cover the aspect that the responsibility of management accountants or controllers

is to support managers with relevant information so as to promote objective and fair decision-

making.


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3.3. Determinants of and influences on differences between management accounting

processes

To analyse why and how management accounting differs between countries, it is

important to concentrate on the main determinants and key drivers that lead to such

variations. The most frequently-stated influence factor held responsible for differences in

management accounting is culture (CHOW ET AL., 1991: 209-10; Chow et al., 1999: 441).

Other factors such as academic and institutional background, as well as the economic

situation of the particular country, can have an impact on diverging management accounting

systems (PISTONI andZONI, 2000: 285; SHIELDS, 1998: 505-6).

3.3.1. Culture as an influence factor in management accounting

Culture can be defined as a system of collectively held values (HOFSTEDE, 1991: 5). In

this context, the cultural framework of HOFSTEDE is commonly applied by management

accounting researchers to explain the variations between different nations and their cultures

(CARR and TOMKINS, 1998: 217). HOFSTEDE (2001: 373-4) developed the familiar five

dimensions of power distance, uncertainty avoidance, individualism vs. collectivism,

masculinity vs. femininity and long versus short-term orientation. Using this framework, it

can be argued that, for instance, Japanese business managers are characterised by more

organisational commitment than their American colleagues, due to a lower tendency towards

individualism (CARR andTOMKINS, 1998: 218).In the economic literature, special attention is also paid to the differences in financial

culture. While, on the one hand, it is commonly stated that the Anglo-Saxon world is more

shareholder and stock-market driven, on the other hand, many scholars do in fact refer to the

German financial culture as more stakeholder driven (SHERIDAN, 1995: 290).

Culture can therefore explain national differences in management accounting. However,

whenever culture is quoted as an influence-factor on management accounting, it is important

not to treat this complex field too simplistically (HARRISON and MCKINNON, 1999: 483).


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Moreover, because this paper focuses on the characteristics and consequences of these

differences, rather than on their cultural causes, these studies are only considered peripherally.

3.3.2. Education, occupation and management accounting institutes as influence factors

The respective educational and institutional situation also varies between the analysed

countries and should be included in the comparative framework. While both in the U.K. and

U.S.A., management accounting is based on a professional environment (AHRENS and

CHAPMAN, 2000: 480; JONES andLUTHER, 2004: 4), management accounting in Germany can

be characterised more as a discipline taught at university than a fully-fledged profession

(SHERIDAN, 1995: 289; AHRENS andCHAPMAN, 2000: 482).

Furthermore, institutional bodies like the Chartered Institute of Management Accountants

(CIMA) and the Institute of Management Accountants (IMA) represent the interests of

management accountants in the Anglo-Saxon countries. Conversely, German management

accounting is highly educationally oriented (Jones andLuther 2004: 3) and there is no well-

established institutional environment. Although not all studies explicitly compare German

with Anglo-Saxon management accounting institutions, all studies nevertheless mention

either the highly sophisticated management accounting profession in the U.S.A. and the U.K.,

or stress the minimal institutional background in Germany. Therefore, the analysed literature

generally concurs with the statement that professional institutions for management accounting

are more sophisticated in the Anglo-Saxon countries than in Germany.Consequently, German developments in management accounting are mostly based on

new ideas and concepts from academics, whereas Anglophone scholars have a reputation for

focussing much more on practical research (AHRENS andCHAPMAN, 1999: 42).

There are also differences between Germany and the U.K. with respect to the type of

qualification of accountants that they acquire before applying for a job in accounting. The

occupational biographies of management accountants highlight the fact that the main route

into the profession of management accounting is achieved via a university degree (AHRENS


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and CHAPMAN, 2000: 480-1). However, while in Germany, it is almost mandatory for

management accountants to have graduated in controlling or at least some other field within

Betriebswirtschaftslehre, AHRENS and CHAPMAN (2000: 480) found that all but one

practitioner in Britain had graduated in a subject that was not relevant to business or

economics.

It can therefore be noted that education in German management accounting is

predominantly acquired by means of an university degree in economics, whereas accountants

in the U.K. are predominantly trained and qualified on the job.

3.3.3. Economic background as an influence factorIn terms of economic background, fluctuations continuously influence and affect different

countries in different ways (GOLDSTEIN, 1995: 719-20). The economic situation in a particular

country can influence the management accounting practices in that country, as well as in other

countries (BLAKE ET AL.,2000: 123). If, for example, one country has to cope with high levels

of inflation, management accountants must consider these circumstances (BLAKE ET AL.,

1998: 56). In addition, if a country is dominated by the economic power of another country,

management accountants will inevitably adopt the latters practices; although with varying

degrees of responsiveness.

4. Comparison of relevant management accounting concepts

4.1. Responsibilities and objectives of management accounting

4.1.1. Objectives and target groups of management accountingIn contrast to Germany, management accounting practices in Anglo-Saxon countries also

include, by definition, the provision of financial reports for non-management groups like

shareholders, creditors and tax authorities. Consequently, one could assume that both the

target groups and the objectives of management accounting differ between these countries.


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According to the NATIONAL ASSOCIATION OF ACCOUNTING (1982: 24) in the U.S., the

objectives of management accounting include providing of information and participating in

the management process. Analysing these objectives further, it becomes apparent that there

are many similarities to the German understanding of management accounting objectives. In

Germany, the aim of management accounting is commonly described as that of ensuring

rational managerial decision making as well as safeguarding the processes of controlling,

planning and governing (AMSHOFF, 1993: 216; MACHARZINA, 2003: 393; WEBER, 2004: 29-

30; KPPER, 2005: 11). Furthermore, it can be stated that all management accountants pursue

the company goal of profit maximisation as well as that of supporting the management.

Therefore, despite a broader field of management accounting target groups in Anglo-

Saxon countries compared to Germany, it can be argued that management accountants in the

observed countries share similar goals and objectives.

4.1.2. Long-term versus short-term goals

A widely-discussed question in comparative management accounting literature is whether

Anglo-Saxon countries like the U.S. or the U.K. are short-term oriented, whereas countries

like Germany and Japan are possibly more long-term oriented with respect to their business

decisions (SHERIDAN, 1995: 290;AHRENS,1997: 557-8; CARR and TOMKINS, 1998: 217)

The dominance for managerial decision making of stock markets in London or New York

is often stated as a key argument for this short-term orientation of Anglo-Saxon managers(SHERIDAN,1995: 290).

In addition to economic reasons, cultural background is also often cited as a reason for the

differences between these countries. Many scholars refer to the cultural model of HOFSTEDE

(2001) for an explanation for the short-term vs. long-term orientation (SHERIDAN, 1995: 290;

COATES ET AL., 1995: 132).

Drawing on empirical findings in the literature, management accountants from the U.K.

consider themselves to be under high pressure to achieve short-term oriented goals, in contrast


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to their colleagues in Germany (AHRENS,1996: 149-50). Similar results can be found in the

comparative study of COATES ET AL.(1995:127), according to which German managers are

longer-term in their thinking than their U.K. and U.S. counterparts. Finally, according to the

empirical study of CARR andTOMKINS (1998: 220), company payback periods are also shorter

in the Anglo-Saxon countries than in Germany. The majority of research discussed above,

thus agree on the short-term orientation of Anglo-Saxon countries in contrast to the long-term

orientation in Germany (COATES ET AL. 1995: 132; SHERIDAN, 1995: 290; AHRENS, 1997:

557-8; CARR AND TOMKINS, 1998: 217). The findings from the literature are summarised in

Figure 2:


Despite this apparent consensus in the literature, an excessively undifferentiated analysis

of these stereotypes must be criticised, because of a lack of questioning the reasons behind

and the implications of these assumptions (AHRENS, 1997: 558). HOROVITZ (1978), for

instance, found no significant differences between long-term planning in the U.K. and

Germany. In his comparative study, he found that the same percentage of chief executives in

Germany and the U.K. use long-range plans (HOROVITZ, 1978: 100). In a long-term

orientation index developed by HOFSTEDE (2001), Germany is also ranked as only slightly

more long-term oriented than the U.S.A. and the U.K. (HOFSTEDE, 2001: 356).

Furthermore, assuming a convergence of management accounting practices as observedby the majority of scholars, a growing similarity of the instruments used for both long-term

and short term business-orientations is identifiable as well (COATES ET AL.,1995: 131).

4.1.3. Management accounting versus financial accounting

Creditor protection and the principle of prudence are historically strongly emphasised in

German accounting. Hence, stringent regulations concerning the reported content to outsiders


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of the company can be observed in Germany (BAETGE ET AL., 2002: 112). Consequently,

financial accountants are driven by statutory requirements, particularly with respect to the

(German) legal and commercial codes and the tax regime (JONES and LUTHER, 2004: 13).

Their task is to emphasise legal requirements, rather than economic needs inside the

company. Financial accounting is directed formally at the state, and not primarily towards

shareholders, as in Anglophone countries.

Consequently, external reports from financial accounting are sometimes considered as

not relevant to management decision making in Germany (JONES andLUTHER, 2004: 13),

probably leading to a denial that financial accounting is a bone fide component of

management (ibid.).

Furthermore, Anglo-Saxon management accounting does not operate with imputed costs

such as opportunity costs for managing owners, as is common in German management

accounting (ZIRKLER, 2002: 23; MESSNER, 2003: 262). Anglophone accounting figures are

based on the same business values that are used in financial accounting. Due to imputed costs,

profits calculated in financial accounts normally differ from those calculated in the

management accounting system in Germany (BAETGE ET AL., 2002: 565-6). Managers in

Germany still emphasise that the numbers reported in the financial statements are not relevant

for internal decision-making purposes.

Because the data reported by financial accountants is based on the protection of

stakeholders and is not relevant for supporting managerial decisions, financial accounting is

separate from controlling. The former is responsible for reporting to the state, taxation

authorities and other stakeholders such as creditors. The latter concentrates on entrepreneurial

or managerial efforts in order to fulfil managerial needs for relevant decision support (KEYS

andMERWE, 1999: 7; JONES andLUTHER, 2004: 14).

In Anglo-Saxon countries, management accounting and financial accounting are also

treated as two separate fields of accounting activity. However, comparing the degree of

separation, it can be observed that a much clearer split between financial and management


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accounting is prevalent in Germany than in the U.S. or the U.K. (JONES andLUTHER, 2004:

13). Indeed, this has already been stated in the definition of management accounting from the

NATIONAL ASSOCIATION OF ACCOUNTANTS (1981). Management accounting in the U.S.A. or

the U.K. not only operates with the same data base as for financial accounting, but a clear

division of financial and management accounting of the occupational level as in Germany, is

also uncommon.

4.1.4. Fields of activity for management accountants

Comparing the fields of activity for which management accountants are responsible,

internal cost management is regularly identified as being one of the main functions of

management accountants in all observed countries (MUSSNIG, 1996: 13-14; ZIRKLER, 2002:

17). This is backed up by empirical findings, that internal cost management is relevant for

65% of German controllers and for 91% of the interviewed U.S. management accountants

(STOFFEL, 1995: 156).

While this common ground for activities may not be surprising, many studies dealing

with U.S. accounting show that management accountants agree with the definition of the

NATIONAL ASSOCIATION OF ACCOUNTANTS (1981), which is responsible for financial

managementactivities like reporting to investors and creditors or dealing with tax authorities

(STOFFEL,1995: 83).

The key results from STOFFEL concerning the fields of activity of German and U.S.management accountants, are presented in Figure 3.


With respect to these findings and in conformity with the studies mentioned above,

financial accounting plays a dominant role for U.S. management accountants, with 97% being

responsible for external accounting matters. Conversely, in Germany, financial accounting is

considered to be relevant for only 21% of management accountants (ZIENER, 1985: 23-4).


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This is the most significant difference that can be identified between German and Anglo-

Saxon management accounting activities.

German controlling is far more detached from cost accounting matters than Anglo-Saxon

management accounting. This again becomes apparent in the relevance of accounts

receivable, for which 66% of U.S. management accountants are responsible, compared to 9%

in Germany.

Management accountants in both countries ultimately agree that budgeting and internal

reporting are important aspects of management accounting in contrast to the field of internal

auditing, which is uniformly regarded as being rather less relevant for daily work. However,

despite this low circulation of internal auditing, the comparison reveals that it is still more

frequently integrated into Anglo-Saxon management accounting than into German

management accounting (ZIENER 1985, p. 23-4). In Germany, internal auditing can be

described as operating closely together with the German controller, but not necessary as being

integrated into the controlling department itself (HORVTH, 2003: 811; STOFFEL, 1995: 93).

By contrast, internal auditing is regarded as a potential activity for management accountants

in the U.S.A. (HABERLAND, 1970: 2182).

Further differences with German und U.S. management accounting can be found in the

appropriate insurance of the corporations assets or the responsibility for computer services

(HABERLAND, 1970: 2184; STOFFEL, 1995: 113-14; WILLSON ET AL., 2003: 4). Normally,

neither of these two fields of activity is assigned to German controlling (STOFFEL, 1995: 93).Finally, because the fields of activity are positively correlated with the numbers of

employees working in a company, these results are only representative for corporations above

certain levels of size (Otto, 2000: 273). Therefore, it is evident that, in smaller firms, the

management accountant is responsible for a broader range of activities in all observed

countries (WILLSON ET AL.,2003: 14).

4.2. Management accounting systems and instruments


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Management accounting systems are intended to satisfy managers needs and to motivate

and assist them in achieving their organizational objectives in a timely, efficient, and

effective manner (KAPLAN andATKINSON,1998: 1). In this context, management accounting

systems must fulfil other requirements than those of financial accounting systems. Concerning

the former, data relevance is regarded as one of the main aspects, whereas the data used for

financial accounting systems is characterised primarily by objectivity and auditability.

4.2.1. General ledger versus two circle system

The handling of data used for external and internal accounting needs is handled in

different ways in the observed countries. As in Germany, management and financial

accounting are separated to a high degree (as stated above), and the systems of management

and financial accounting are also separated by the use of a two circle concept. That is, two

different accounting circles apply to internal and external accounting (Messner, 2003: 249).

At first glance, there is a dividing line between financial accounting and management

accounting in the U.S.A. and the U.K., due to the different activites and accounting goals.

Contrary to Germany, proximity between internal and external accounting can nevertheless be

observed in the sense that no two completely separated data bases are used in the Anglo-

Saxon countries (KAHLE, 2003, p. 775). More specifically, a common data base named

general ledger is commonly applied (KAHLE, 2003: 775).

While this general ledger system is widely accepted at an international level, the two-circle or dual cost system is still the most commonly used in Germany. Financial and cost

systems are run independently in Germany, with a reconciliation module provided to

articulate between the two sets of statements at the end of the year when financial statements

are prepared (KAPLAN and ATKINSON, 1998: 8). In the following discussion, both the

characteristics, consequences and differences that arise due to this variation will be discussed.

The general ledger system can be described as an integrated system that includes all

accounts in the financial statements. The key characteristic of this system is that the two


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different systems - financial accounting and management accounting - access a jointly-used

data base (OEHLER,1997: 358; ZIRKLER,2002: 19). While the same data is used for external

reporting as well as for internal decision support, both financial accounting and management

accounting therefore calculate with the same values and basics. Consequently, costs are

computed based on aggregate, average allocations of manufacturing overhead, and control

procedures use monthly variances computed from general ledger financial accounts (KAPLAN

andATKINSON,1998: 8).

Because the capital market now plays an important role for Anglo-Saxon companies,

external reporting to both shareholders and creditors can be regarded as very important for

corporations. Significantly more management accounting information is used for external

reporting in the U.S.A. than, for instance, in Germany (ZIRKLER, 2002: 16). Consequently, it

can be assumed that the general ledger system is dominated by financial accounting data

(ZIRKLER, 2002: 21).

A further significant difference from the German point of view, is the virtually non-

existence of imputed costs in Anglo-Saxon management accounting as mentioned above

(ZIRKLER, 2002: 21; MESSNER, 2003: 262). While imputed depreciation and interest are of

great importance in German management accounting (SCHERRER, 1996: 105), they rarely

appear in Anglophone management accounting theory and practice (ZIRKLER, 2002: 21;

JONES andLUTHER, 2004: 17; WEBER,2004: 16).

The difference between costs and expenses is deemed very important in Germany. Profitscomputed in the financial accounting system differ from those in the cost accounting system,

due to imputed costs such as depreciation or an opportunity cost for the managing owner

(CHRISTENSEN andWAGENHOFER, 1997: 255).

As a consequence, the potential scope for manipulation in the field of management

accounting is greater in Germany, with the use of imputed costs, compared to Anglo-Saxon

countries, which calculate solely with actual costs (KPPER, 1995: 24-5). The determination

of imputed depreciation or imputed management salary, for instance, offers a window of


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opportunity for managers to justify a different level of profit to that presented in the external

reports (MESSNER, 2003: 264).

Similar to imputed costs, opportunity costs are uncommon in Anglo-American countries

(HORNGREN ET AL. 2003: 397-8). If required, these types of cost are calculated in special

calculations for particular purposes. Therefore, in contrast to Germany, a relatively high

percentage of diverse special analysis can be found in the general ledger system (Z IRKLER,

2002: 22). Finally, a spin-off of accounts payable and accounts receivable from the main

ledger into subsidiary ledgers is also typical for the general ledger system (OEHLER, 1997:

358;ZIRKLER,2002: 22).

As a reason for the joint use of a common database, KAPLAN and ATKINSON (1998: 8)

state that at the beginning of the last century, the high cost of information collecting,

processing, and reporting [] led companies to attempt to manage their internal operations

with the same information used to report to external constituencies.

In Germany, the benefits of separating management and financial accounting data and

hence having an autonomous data base for internal calculations is regarded as more important

than the higher costs of keeping two sets of books. Although the demand for financial

information is taken into consideration in this system, many managers consider this

information alone as insufficient for running a company (CHRISTENSEN and WAGENHOFER,

1997: 255; KEYS and MERWE, 1999: 8). Moreover, the benefits are seen as the ability to

support managerial decisions without any additional calculations from data that is basedinitially on the strict rules for external reporting. The disadvantages of additional costs for

collecting and maintaining separated data bases are currently reduced by state-of-the-art

software (KEYS andMERWE, 1999: 8).

4.2.2. Management accounting instruments

Management accounting instruments are among the key drivers of convergence in

management accounting. In the search for best practice, management accounting instruments


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are easier to adopt than a new accounting system or a foreign culture. It can furthermore be

assumed that management accountants are familiar with the most common instruments of

management accounting. Therefore, although German and Anglo-Saxon managers approach

accounting from different directions, the instruments and tools can be assumed to be largely

similar, and specific management accounting techniques enjoy various degrees of popularity

in different countries (SHERIDAN, 1995: 291).

WhileActivity Based Costing (ABC), for instance, has attracted considerable attention in

the Anglo-Saxon countries since the mid-1980s, ABC is less commonly applied in Germany

(SCHERRER, 1996: 104; FRIEDL ET AL., 2005: 56). Comparing the application of ABC in

Germany, the U.K., or the U.S.A., it is evident that there are also different approaches to

ABC.

The classical ABC in the Anglo-Saxon countries links the overhead allocation to the

activities carried out to produce and sell a product. In Germany, an alternative approach,

Prozesskostenrechnung (process cost accounting), is applied more commonly and only

considers costs external to the manufacturing department (FRIEDL ET AL.,2005: 60). In this

respect, DAVIS and SWEETING (1991: 44-5) analysed the use or planned use of cost

management techniques in the U.K. and ranked ABC with an affirmation rate of 60% as

important for U.K. manufacturing enterprises. In Germany, FRANZ andKAJTER (2002: 579-

80) recently analysed the spread of ABC and found that only 47 % of large German firms

used ABC, and only half of these companies (48%) applied it regularly. In this context,BHIMANI (1996: 103) observed that ABC seems to be particularly strong in the U.K. and

comparatively weak in Germany.

Contrary to the use of ABC, Grenzplankostenrechnung (flexible margin costing) can be

deemed one of the most important cost accounting tools for German companies (FRIEDL ET

AL.,2005: 56). This concept focuses on contribution margins and variable costs, rather than

on full costing (as in ABC) and hence supports short-term decisions such as whether to accept

or reject an additional order.


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While another instrument such as budgeting is regarded as more or less equally important

for all management accountants (Sheridan, 1995: 291), instruments like discounted cash flow,

payback or internal rate of return are applied to varying degrees. COATESET AL.(1995:132)

found thatmanagement accounting instruments are used in terms of the financial goals and

orientation of a company and may therefore differ in their appliance and use.

4.3. Organisational integration of management accountants in the corporation

4.3.1. Hierarchical level of management accountants within the corporation

As analysed with respect to the definitions of management accounting,as well as to the

activities presented above, management accountants deal with objectively fair and highly

relevant data within the corporation. Therefore, calls for a high hierarchical rank of

management accountants can be found in the management accounting literature in all

countries (HABERLAND, 1970: 2183; MACHARZINA 2003: 390).

Therefore, management accountants should operate at a relatively high organisational

position within the corporation and should be integrated sufficiently into the operational,

strategic and tactical planning of the corporation (MACHARZINA 2003, p. 390). Additionally,

securing the independence, neutrality and authority of the controller is considered important.

This could be maintained by positioning the accountant at least at the second hierarchical

level, or as part of the board of directors (HABERLAND,1970: 2183; STOFFEL, 1995: 98). Such

demands for an influencial and responsible position within the company, as generallyproposed in the literature can to some extent be supported by empirical data.

In Germany, empirical studies conducted in the 1980s and 1990s were in line with the

above-mentioned statements and showed a dominance of controlling at the second

hierarchical level (SERFLING, 1992: 82). UEBELE (1981) and AMSHOFF (1993)found 54% and

60% respectively of controllers to be positioned at the second hierarchical level within the

corporation (UEBELE, 1981: 31; AMSHOFF, 1993: 335). In the U.S.A. however, there are


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hardly any recent empirical studies on the positioning of management accountants in the

hierarchy (STOFFEL,1995: 103).

STOFFEL examined the hierarchical integration of German, U.S. and French management

accountants. According to his results as presented in Figure 4, 8 % of German management

accountants are classified at the first hierarchical level, 65 % at the second, 26 % at the third

and only 1 % at the fourth hierarchical level. By contrast, in U.S. corporations, no controller

can be found at the first level, 39 % at the second, 50 % at the third and 11% at the fourth

level.


Because most U.S. management accountants (50%) are currently assigned to the third

hierarchical level in this study, a generally lower positioning, compared to their colleagues in

Germany, could be assumed. However, before drawing any further conclusions from the

findings of the above study differences between the structures of large companies in the three

observed countries have to be taken into account.

In Germany, the law requires an organisational structure for public limited corporations

which is fairly distinct from the Anglo-Saxon board system. In contrast to the one-tier system

in the U.S.A. or U.K., German Public Limited Corporations are characterised by a

management board with at least three members. Therefore, the top level in German

corporations is by nature broader than in Anglo-Saxon corporations, whereas only the CEOcan generally be identified as representing the highest level of management. Consequently,

comparing the levels of hierarchical integration, it seems that a second hierarchical level in

the U.S. can be regarded as somewhat higher in the organisation than an equivalent position

in German corporations.

Therefore, despite the differences between German and Anglo-Saxon companies

identified above, it is evident that management accountants in Germany and the U.S.A. are

both ranked at a relatively similar level of influence and responsibility within the corporation.


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4.3.2. Interrelations and connections to adjacent departmentsAnalysing the organisational integration of management accountants in the hierarchy of

the corporation, entails firstly, examining the name given to the department in which

management accountants work. This term can then be interpreted as an indicator of both the

activities and the interrelations within the company.

In German companies, the department in which management accountants are located is

nearly always labelled controlling department or something similar which includes the term

controlling, such as Betriebswirtschaft/Controlling (STOFFEL, 1995: 140). In the U.S.A.,

by contrast, the nomenclature can vary significantly. STOFFELs findings indicate that, 25 % of

the departments for management accountants are also called Controllers department,

whereas 42 % are labelled Finance Department and 28 % Accounting Department.

In the U.S.A., controllership remains closely interwoven and connected with financial

aspects. Moreover, the controller is often seen as a financial executive, who reports to the

CFO at the same hierarchical level as the treasurer (SIEGWART, 1982: 99; STOFFEL, 1995: 143;

WILLSON ET AL.,2003: 18).

An analysis of the situation in Germany reveals similar variations in the practical

environment (KPPER, 2005: 518). As a common denominator, controlling departments can

normally be observed at the same hierarchical level as finance departments. In contrast to the

U.S.A., this does not necessary include any interrelations between the departments(SHERIDAN,1995: 291).

This is supported by empirical findings, according to which 54 % of German controlling

departments have no organisational connection to financing, whereas such a strict separation

was evident in only 3 % of the U.S. corporations (STOFFEL, 1995: 144). Controlling can

therefore be found either at the same hierarchical level as the finance department, being an

administrative department supporting the head office, or in conformity with the Anglo-Saxon


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model, as the same level as the treasurer who reports to the accounting department (KPPER,

2005: 528).

4.3.3. Size of management accounting departments

Comparable to the field of activity which was identified to be broader in the Anglo-Saxon

countries than in Germany, management accounting departments also normally operate with

more employees in Anglophone countries (STOFFEL, 1995: 117). This is empirically

supported by STOFFEL (1995),who found that, on average, 29.3 people are employed in U.S.

management accounting departments, compared to 12.7 employees in German controlling

departments (STOFFEL, 1995: 150).

4.4. Role of the controller in the observed countries

The fields of activity, the instruments used to achieve goals and the organisational

integration of management accounting may be similar or vary between countries. However,

the topics discussed above give only a limited indication of the self-perception and the role

that management accountants actually play within the organisation.

In all three countries, both the changes and the development of the role of management

accountants are important and must be taken into consideration. Variances and differences in

the role of the accountants can be seen as an indicator of the degree to which management

accounting itself is converging or diverging throughout the observed countries. In thiscontext, there is consensus among management accounting scholars that the former, familiar

role of the controller as a pure score keeper is at least partly obsolete in all countries

(KAPLAN and ATKINSON, 1998: 1; WEBER, 2004: 5). Observing the current status of

management accountants and their role within corporations, some differences between the

three countries are identifiable.

4.4.1. Role of management accountants in Germany


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The relevant literature and practice concur that, in Germany, the management accountant

has evolved from a pure score keeper of past performance into a central contact person who

participates in the management process (MUSSNIG, 1996: 15; WEBER, 2004: 21).

In this context, the mission statement of the INTERNATIONALER CONTROLLER VEREIN,

conveys an image of the German management accountant who concentrates on the creation of

transparency and visualisation of economic consequences, rather than operational

involvement in actual decision making. Furthermore, in Germany, the role of the management

accountant is characterized as that of a modern coordinator and moderator of plans and

processes within the corporation. By maintaining and creating the management accounting

system, the management accountant should be able to support decision makers within the

corporation by providing relevant information on a wide range of issues (INTERNATIONALER

CONTROLLER VEREIN, 2006). This represents an image of the German management

accountant as an advisor and provider of relevant information who visualises the economic

consequences rather than being involved in the decision-making process.

This image is supported by German scholars, who stress either the coordinative

function, the provision of information function or the function of controlling as a special

aspect of leadership (STOFFEL,1995: 79; HORVTH,2003: 148-9; WEBER 2004: 30-1). What

all of these functions have in common, is that management accounting is no longer seen as

pure score-keeping.

In his numerous comparative studies of the role of British and German managementaccountants, AHRENS (1997: 583) also supports this image, whereby in Germany, controlling

has no official input into concrete action and carries no operational responsibility

(AHRENS, 1997: 564). Referring to his findings, German management accountants consider it

necessary for the controlling department to be distanced from operational action and merely

analyse or investigate the economic consequences of the organisational effort. Management

accounting in Germany can, therefore, be seen as a representational effort, focussing on the

coordination of business activities through plans. Through this rather bureaucratic


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perspective, it can be stated that German controllers first and foremost see the organisation

through the plan. (AHRENS,1997: 564).

We are responsible for the planning process and generate the planning calendar,

the schedule of activities. We are responsible that the planning systems are

available, but we are not responsible for the contents of plans. [] so we carry not

(operational) responsibility. (ibid.)

In conformity with the above image of a supporter and advisor of decision makers within

the corporation, the management accountant should help, advise and ensure, that planning

takes place (AHRENS,1997: 562).

SHERIDAN (1995: 291) discusses another aspect of management accountants in Germany,

namely that management accountants are much more future-oriented, than for instance, their

colleagues in Anglo-Saxon countries. In Germany, companies are management by the real

[internal] figures as opposed to publicly reported ones. Therefore, SHERIDAN argues that it is

possible for accountants to look much more at the future than, for instance, British

management accountants.

4.4.2. Role of management accountants in the U.K. and the U.S.

Contrary to the above findings, the management accountants analysed by AHRENS regard

themselves as more future-oriented than their colleagues in Germany (AHRENS, 1997: 583).

Rather than being too distanced from operational matters and just acting as scorekeepers,

British management accountants see their strengths in the involvement with proactive

decision making and the formulation of strategic direction (AHRENS, 1997: 584). Furthermore,

planning and coordinating, which have been identified as key instruments of German

management accountants (HORVTH, 2003: 165), were seen in the U.K. as something that

just has to be done sometimes (AHRENS,1997: 573) and hence did not share the same status

as in Germany. Although it is open to debate whether the latter aspects of planning and

coordination are representative for U.K. management accountants in general, this statement


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nonetheless supports the perception of the role of management accountants in the Anglophone

literature.

Several researchers agree with AHRENS and consider the modern Anglo-Saxon

management accountant as being far more deeply involved in operational decision making

than, for instance, in Germany (STOFFEL,1995: 120; WILLSON ET AL.2003: 5-6). This is based

on the notion that the Anglo-Saxon management accountant is, by definition, responsible for

supporting and coordinating the decision-making processes in upper management

(GRANLUND andLUKKA, 1998: 164). Due to the close organisational connection with finance

and especially with the internal cost management department, this role of the management

accountant as a pure consultant or provider of information, who is detached from operational

matters, cannot be supported (STOFFEL, 1995: 122).

Nevertheless, for all observed countries, it can be stated that the management accountant

has developed from the above mentioned pure cost accountant to someone with broad

management and interpersonal skills who can interact with other departments (WILLSON ET

AL.2003: 9; WEBER, 2004: 20-1). Management accountants are no longer mere scorekeepers

of past performance and have become value-adding members of management teams (KAPLAN

and ATKINSON, 1998: 1). As opposed to previous observations, the management accountant

can now be described as a modern manager with at least as much management experience as

accounting knowledge (WILLSON ET AL.2003: 7).

5. Conclusion and future prospects

5.1. Current developments

One current development seems to erode the strict separation in German financial

accounting practice (JONES and LUTHER, 2004: 14; WEBER, 2004: 176). The increasing

implementation of international accounting standards like IFRS or US-GAAP in German-

based multinationals is sparking a debate on the use of external reporting data for

management accounting calculations (WEBER, 2004: 172). Companies like SIEMENS,BAYER


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orDAIMLER-CHRYSLER have abandoned the isolated orientation on operating profits based on

imputed internal data. Instead, these companies focus rather on operating profits for internal

calculations, which are derived from external figures. This development in German

accounting is commonly referred to as Biltrolling1

(CHRISTENSEN and WAGENHOFER, 1997:

255; ZIRKLER,2002: 282; MACHARZINA,2003: 392).

Accordingly, a harmonisation of internal and external accounting can be observed in a

growing number of German companies. Consequently, a system with a nearly identical basis

for internal and external values allows for comparisons with the general ledger system in

Anglo-Saxon countries.

This approach of externally and internally reported figures becomes feasible due to the

characteristics of the international accounting standards IFRS and US-GAAP. They are

viewed as resulting in less biased numbers (CHRISTENSEN and WAGENHOFER, 1997: 255)

and are much more committed to delivering and procuring relevant information. Furthermore,

these standards are less tax-driven and put less emphasis on valuation principles such as

prudence (CHRISTENSEN and WAGENHOFER, 1997: 255; KAHLE, 2003: 773). The

implementation of IFRS or US-GAAP provides reasons for firms to combine internal and

external accounting figures within the corporation (KAHLE, 2003: 774). A stronger orientation

on the economic reality and measurement of managerial efficiency stresses the modification

of international accounting standards for internal control needs.

Considering recent developments in management accounting practice, the above-mentioned statement on the lack of relevance of financial accounting figures for internal

management decisions seems to be unwarranted (CHRISTENSEN and WAGENHOFER, 1997:

255).

In the past, little knowledge and experience has been transferred from Germany to the

Anglo-Saxon countries. Recent developments in both management accounting practice and in

1Biltrolling is an amalgam of the two words Bilanz and Controlling and refers to a combination ofcost-oriented controlling and financial management accounting.


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the literature signal a reversion of this knowledge transfer from German management

accounting to Anglo-Saxon countries.

As described above Anglophone corporations are increasingly becoming aware that

management accountants are excessively involved in operational matters. Therefore, a

satisfactory level of support of management with respect to making objective and fair

decisions is not always ensured (HORVTH, 2006: 3).

As a solution, the concept of German management accounting is discussed regularly in

the Anglophone management accounting literature (HORVTH, 2006: 3). In the past two years,

the monthly release of STRATEGIC FINANCE, the journal of the U.S.-Institute of Management

Accountants (IMA), has published a series of papers dealing with German management

accounting (HORVTH, 2006: 3).

Turning to practical developments, the German SAP enterprise resource planning

software can be regarded as an important driver of convergence and knowledge transfer from

Germany to the Anglo-Saxon countries. This software is widely used in large companies

worldwide and offers the conceptual framework of German flexible-margin costing. A

transfer of this knowledge is gaining increasing acceptance in management accounting

practices in the Anglo-Saxon countries (FRIEDL ET AL.,2005: 56; HORVTH, 2006: 3).

5.2. Summary

The present paper compared management accounting practices in Germany, the U.K. andthe U.S.A. and analysed the directions in which they are moving. Dealing with management

accounting at an international level reveals a range of both differences and similarities.

The most significant difference between Anglo-Saxon and German management

accounting is therefore the use of the respective management accounting system; either the

general ledger concept or the two-circle system. Due to these varying approaches, further

differences arise, such as the lack of imputed costs in the Anglo-Saxon countries and different

bases for calculating profits in Germany. In comparison to the U.S.A. or the U.K., German


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management accounting exerts a stronger influence on management, because financial

accounting figures are deemed as not useful for internal decision making (JONES andLUTHER,

2004: 13).

Further important differences were revealed in the deeper involvement in operational

matters and the broader fields of activity of management accountants in the U.S.A. and the

U.K. While Anglo-Saxon management accounting is also directed at shareholders, German

management accounting is addressed at internal target groups alone.

Besides these differences, some similarities and commonalities could also be observed.

Regardless of the varied target groups, management accountants in all three countries apply

reasonably similar objectives and goals, which are to provide information, participate in the

management process and ensure rational managerial decision making.

This is the main driver behind the convergence of Anglo-Saxon and German management

accounting. The instruments applied by management accountants are the catalyst for

achieving this. They are independent of most distinguishing factors such as cultural and

educational background. Therefore, the more instruments that are applied and the more best-

practice instruments that are mutually exchanged between the countries management

accountants, the quicker and broader is the convergence in the respective field of activity. As

has already been stressed, this is currently happening. German management accounting and

Anglo-Saxon accounting are both recognising the advantages of each others techniques and

practices. In Germany, the concept of Biltrolling indicates a harmonisation of internal andexternal accounting similar to the Anglo-Saxon model. Conversely, German cost management

is commonly presented as best practice in recent U.S. management accounting literature.

Furthermore, applications of the German based software SAP also lead to a knowledge

transfer from Germany to the Anglophone countries.

In discussing the fundamental need for a discipline like comparative management

accounting, it can be stated that, despite these convergence tendencies, differences in

management accounting practices still exist and will presumably remain in the future. Due to


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increased competition and changing environments, management accounting characteristics

may converge in most aspects and between most countries, but it will continue to diverge

between other countries and industries (SHIELDS, 1998: 506; SHERIDAN, 1995: 291).

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Topic

Comparative

management

accounting

National

management

accounting

Peripheral to

management

accounting

Germany, U.S.

and / or U.K.

(1)

'main focus

of the paper'

30 studies

(2)

'comparison with

other countries'

7 studies

(3)

'consider some

aspects'

7 studiesCountries

Others

(4)'search for

similarities'

3 studies

(5)not

relevant

(6)not

relevant

Figure 1: Categorisation of management accounting literature

German management accounting is more

long-term oriented than U.S. and U.K.

management accounting

Others

2

22%

Disagree

2

22%

Agree

5

56%

Agree

Disagree

Others

Figure 2: Comparison of long-term orientation of management accountants


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Fields of activities of management accountants

0 20 40 60 80 100

Budgeting

Operational planning

Strategic planning

Internal reporting

Pre-investment analysis

Internal cost management

Financial accounting

Liquiditiy management

External reporting

Tax planning and administration

Accounts receivable

Insurance

Internal auditing

Computer applications

%

Germany

U.S

Figure 3: Fields of activity for management accountants(Source: Adapted from STOFFEL, 1995: 157)

Comparison of management accountants integration

0

10

20

30

40

50

60

70

1 2 3 4level of hierarchy

%

Germany

U.S.

CMA UK Germany

Documents

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