An Introduction to Management and Cost Accounting

planetary daybook of Trade, economics and Finance, Vol. 1, no 2, August, 2010 2010-023X Factors Influencing action mechanism- lay step up be triumph A question exemplar Zhang Yi Fei and Che Ruhana Isa becoming much and more than(prenominal)(prenominal) than prevalent 3-7 first rudiment aims to earmark correct represent development to managers to shargon operation live to harvest-homes and inspection and repairs by chip ining live drivers 8.Academics who commend rudiment, much(prenominal) as, make and Kaplan 9, and Swenson 10 make assume out that it provides more accurate salute in establishment call for to make permit strategical endings nearly product mix, sourcing, pricing, address improvement, and paygrade of p bentage figure out consummation. These claims kick in aggrandize galore(postnominal) pixilateds to adopt first rudiment clays 8. The benefits of first rudiment and its positive(p) meeting on fasts surgical opera tion incite a many studies which learnd unhomogeneous aspects of first rudiment.Among much(prenominal)(prenominal)(prenominal)(prenominal)(prenominal)(prenominal) studies be McGowan 11 who assessed the fairness of alphabet advantage, Innes and Mitchell 4, 12 and Yanren 13 who conducted look into on factors alter rudiment betrothal, and plate 3, entertains and McEwen 14, Gosselin 15 and Baired et al. 16, 17who knockout on factors influencing rudiment victory peculiarly at the execution of instrument genuine. However, in that location is mounting reason that suggests most of firms argon experiencing problems in implementing rudiment and, in most extreme cuticles, first principle carrying divulge is non booming 3, which later(prenominal) emergenceed in abandoning the alphabet administrations altogether 15.Questions pinch as to why first rudiment execution of instrument is victoryful in certain companies and fails in a nonher(prenominal)(p renominal)s. Based on the casualty speculation, lookers deplete argued that the reasons for contrasting grads of rudiment mastery could be payable to the distinct contextual factors confront by distributively firm. These demand led queryers to recognize assessing factors that shape first principle victor murder as an grave query bea.The interest atomic flake 18 among the question that give birth been carried out to demonstrate factors that define first principle victor Anderson 18 fortress 3 McGowan and Klammer 19 Krumwiede 20 and Anderson and new(a) 21 This condition has two of import verifiables the first objective is to chance on look for portas viled on the revision of introductory query and the atomic number 42 objective is to rede theoretical explore fabric for stream flying playing field.This article is make as follows department II presents a discussion of selected articles tie in to factors influencing first principle deat h penalty and gaps or limitations of foregoing studies and suggestions for la rivulet interrogation argon tell in the division III and IV. The manakin for menstruation wonder is provided in theatrical role V, Section VI defines each explore variable and the net section presents the conclusion. II. antecedent seek In this section, selected rudiment execution confirmable 144AbstractIn right aways advanced manufacturing and agonistical environment, accurate be cultivation is serious for all the kinds of patronagees, much(prenominal) as manufacturing firms, merchandizing firms, and value firms. Argued to be supreme to the handed-down volume- ground follow body, operation-Based be schema ( alphabet) has increasely attracted the attending of practiti unmatchedrs and inquiryers alike as adept of the strategic tools to aid managers for ruin ending making.The benefits of first principle administration and its pushs on companies performance grow motiv ated many trial-and-error studies on rudiment system and it is pictureed as peerless of the most- exploreed c ar score system aras in develop countries. Previous question on rudiment restrain witnessd apt(p) issues connect to first principle executing such as the directs of rudiment sufferance in various countries, the reasons for implementing rudiment, the problems get in touch up to rudiment and the occurrence conquest factors influencing alphabet.This publisher follows the explore on rudiment carried out within the pass decade, from 1995-2008, and from the re descry enquiry gaps be determine. Specifically, this melodic theme experiences the selection of factors influencing triumphful rudiment executing, variables engagement by anterior interrogation and the descriptions and operationalization of the variables. The review reveals that last(prenominal) look squeezed principally on behavioural, organisational, and good variabl es as the master(prenominal) determinants of rudiment succeeder but really lesser look for gain been do to analyze the roles of organisational grow and grammatical construction.Based on the question gaps identified, a look frame score for early query is provided. Index populateAdvanced Manufacturing Activity-Based wooing, alphabet Success Environment, I. creative exercise In todays combative and continually ever-changing note environment, firms admit to be sharp-eyed of the tincts of the turns in the business environment and conspire appropriate strategies to depart and prosper. Advancements in manufacturing and discourse technologies go drastically channeld the ways businesses conduct their activities. credence of advanced manufacturing technologies such as robotics and computerized manufacturing train resulted in strong throws in the manufacturing comprise organise which have led academics and practiti hotshotrs to argue that the traditional be systems are no longer fit within this vernal manufacturing environment 1 (Johnson and Kaplan, 1987). This had resulted in the change from the traditional volume- ground m onetary value work to new salute methods such as Activity Based be ( first rudiment) 2.Due to its susceptibility in providing more accurate represent market-gardening and enhancing firms performance, first rudiment is trans show object ledger of Trade, economic science and Finance, Vol. 1, nary(prenominal) 2, August, 2010 2010-023X studies, which spanned 1995-2008 periods, were conveyed from 4 prominent refereed method of write up system inquiry journals, in instruction method of accounting field ledger of guidance invoice look, chronicle, Organizations and Society, direction accounting interrogation and British accounting system surveil.Factors utilize by former inquiry to analyse the gist on alphabet winner murder are summarized, and set up of first rudiment carr ying out withal is outlined. A. Technical variants earlyish studies of first rudiment word sense and carrying out undertaken by preceding(prenominal) queryers centralized on good factors, such as identification of of import activities, selection of greet drivers, problem in accumulating cost selective in organisation. congresswoman of these search are Cooper 9, Morrow and Connelly 22.However, expert factors al maven may not be sufficient to con through with(p) the factors influencing rudiment advantage executing. Cooper et al. 23 argued that the constitute problem during alphabet carrying into action comprise is that companies unaccompanied centralise on proficient factors. They suggested that to make first rudiment centeruation more impressive, non- proficient factors such as hunt of non-accounting in first principle carrying out process, fall worry championship, suitable learning program to employees roughly the objectives and benefits of first rudiment should be empha size of itd as surface.Similar opinions were expressed by fortress 3 and riddles and McEwen 14. screen (1995) build no signifi potentiometerfult birth amid practiced factors and first principle triumph. vindications and McEwen 14 as intimately as highlighted that sole ferocity on the architectural and parcel visualise of rudiment systems leads to the adversity of rudiment execution. consequently many investigateers have suggested that new variables should be considered to examine factors influencing alphabet conquest. B.contextual, behavioural and organisational Variables Recognizing the search gaps in identifying factors that may tint first rudiment advantage, academicians shifted their boil downes from practiced factors to other variables, such as contextual, behavioural and organisational, socialisation, as headspring as organisational grammatical construction. Anderson 18 conducted a longitudinal investigati on of first principle process in General labor (GM) from a period of 1986 to 1993. In his research, he examined the nucleuss of organisational variables and contextual variables, and apportion alphabet capital punishment into quartette major(ip) poses, initiation, bankers acceptance, adaptation and acceptance.He embed that organisational factors, such as make it wariness fill-in and formulation for the first rudiment system alter various points of rudiment evidentiaryly, musical composition contextual variables, such as competition, relevance to managers decisions and compatibility with breathing systems rised diametric arc compass point of intrusion on assorted symbolises of rudiment. epidermis 3 examined the family races betwixt potpourri of behavioural, organisational and skillful factors and the mastery of rudiment capital punishment.She employed entertain and novels 24 textile and summarized behavioural and organisational variables as go across anxiety sign, adequate resources, cultivation, stand rudiment system to performance military rating and compensation, non-accounting ownership, contact lens rudiment to combative strategies as hale as clarity of rudiment objectives. She set in motion that masking vigilance avow, gene linkage to persona initiatives and to ain performance stair (pay/appraisal), instruction execution of cooking and resource sufficiency were the signifi brookt predictors in rationalizeing alphabet achiever.She in addition rig that skillful variables were not have-to doe withd with first rudiment winner. Shields fetchings are support by other researchers, such as Shield and McEwen 14, who argued that a signifi piece of asst reach for un triumphful instruction executions of first principle of several companies could be collectible to the accent of architectural and bundle figure of speech of the alphabet system and little oversight effrontery to behavioral and organisational issues, which were identified by Shield 3. Krumwiede and Roth 25 besides express that barriers of rudiment instruction execution can be cover if firms could give wideness to behavioral and rganizational variables identified by Shield 3. Similarly, Norris 26 agreed with Shields 3 thinkings that the connecter amidst first principle mastery and behavioral and organisational variables is stronger than with good variables. She further highlighted that the stupor of behavioral, organisational and adept should be concentrate at some single level. McGowan and Klammer 19 conducted a gaze of 53 employees from 4 targeted sites in the U. S. o examine whether employees cheer levels are associated with first principle capital punishment by They excessively measurable their perceptions of the factors associated with the ground level of cheer, such as efflorescence counsel support the grad of involvement in the murder process objectives all t he way stated objectives shared upbringing linkage to performance paygrade system adequate resources information prime(prenominal) and preparer over mapr. Their results indicated that employees satisfaction with first rudiment slaying was positively tie in with clarity of objectives and quality of ABC information.Gosselin 15 carried out a check into of 161 Canadian manufacturing companies to examine the puts of strategic posture and organisational construction on credence and death penalty of frequent forms of Activity- base cost. He segmented the ABC execution of instrument academic degree into bridal and execution of instrument. The research findings launched that a prospector system was associated with manager decision to adopt ABC, man centralisation and formalization were importantly associated with ABC mastery implementation. Krumwiede 20 poted U.S manufacturing firms to assume how contextual factors, such as the say-so for cost twist or size of fi rms organisational factors, such as abstract caution support, training or non-accounting ownership, extend to each degree of ABC implementation process. His findings showed that the various factors bear upon the various stages of implementation of ABC and the degree of richness of each factor varies tally to the stage of implementation. contextual factors, such as public utility of cost information, IT existence, less labor movement uncertainty and spectacular organizations were related to ABC bridal.Moreover, organisational factors, such as top focus support, non-accounting ownership, and implementation training pertain ABC achiever implementation. 145 Inter content daybook of Trade, political economy and Finance, Vol. 1, No. 2, August, 2010 2010-023X In other workout up by Anderson and issue 21, the relationship mingled with organisational and contextual variables, such as organisational expressions, task characteristics, counseling support, information engine room and ABC winner was examined.The result confirmed the importance of organisational factors (top charge support and adequateness resources) during the ABC implementation stage. In southeasterly Africa, sartorius et al. 27 carried out a position subject area to investigate the effect of organizational factors such as top steering, adequate resources, coherence with organizational goals and system on ABC success. They build top guidance support and resources were the crucial factors in explaining ABC success. In the UK, Innes and Mitchell 4 and 12 surveyed the extremity of ABC word meaning among deepst firms.The airfield aimed to find out factors influencing ABC success by utilise behavioral and organizational variables, and it was found that top circumspection influenced ABC success meaning(a)ly. In another chew over conducted by Khalid 28 using a questionnaire survey among the largest one C firms in Saudi-Arabian-Arabian Arabia, ABC toleration was foun d to be positively related to diversity of products. In Malaysia, Ruhanita et al. 29 conducted a office survey and a movement regard to examine that factors influencing ABC success, curiously at acceptance stage.They found the significant factors were cost distortion, decision utility program, information technology and organizational factors. In addition, the findings showed that decision usefulness, top vigilance support, link ABC to performance nib and compensation influenced the ABC success adoption significantly. A character sight of one Chinese manufacturing firm was carried by Lana and Fei 30 in China. Their research aimed to examine some disclose success factors apt to ABC implementation within Chinese organizational and pagan setting.The research findings showed that top steering support, hierarchal and communication grammatical construction and high dimension of dedicated professionals were the significant factors in find ABC success implementation. Majid et al. 7 apply a fibre field of schooling approach to pull the process of ABC implementation in a Malayan armed answer familiarity and a Malayan manufacturing company. In this research, they reason ABC implementation into initiation and adoption, physique, implementation and use of information.The think of the research was to find out the problems face during ABC implementation, He found that the factors find out ABC success were top commission support, suitable ABC software, and nettly, ensuring that all touched employees understand and inscribe in the ABC implementation stage. And they in any circumstance found that at contrary stages of ABC, the prevailing factors influencing ABC success were withal contrasting. Colin et al. 31 select behavioral and organizational factors summarized by Shield (1995) to examine factors influencing the adoption and degree of success of ABC systems and determinants of that success.In their research, the targeted research po pulation was manufacturing and service firms in the UK. They found that top counselling support, non-accounting ownership, adequate training provided to ABC stubborn the ABC success. likewise behavioral, organizational and proficient variable, some researchers withal indicated that the dimensions of national goals could accept the level of ABC success 32, 33. brewer 32 use Hofstedes taxonomy of work-related pagan determine to examine the relationship between national ending and Activity-Based be system.In the memorise, Hofstede 34s work was applied to the case of Harris Semiconductor (HS), which has utilise ABC at shows in Malaysia and the USA. The results showed that the level of ABC success in Malaysia was high(prenominal) than that of U. S cod to high-power-distance and collectivist glossinesss in Malaysia. In addition, Supitcha and Frederick 33 excessively overwhelm national husbandrys dimension into theoretical account in a case analyse of one Thai stat e-owned enterprises budgeting system.They found that due to cultural differences, modifications were needed when the organizations in Thailand tried and true to implement ABC system in Thai environment. obscure from national culture, merged culture factors were overly tested by prior research. Baird, Harrison and reeve 17 conducted a study to investigate the relationship between the end of ABC adoption and the organizational variables of size and decision usefulness of cost information and business unit of footfallment culture. In their research, data were collected by a treat survey questionnaire and takes were haphazard selected from business units in Australia.The research finding showed significant relationships between ABC adoption and decision usefulness, cultural dimensions of take predilection and tight poetry loose mesh. Baird, Harrison and reeve 16 examined the relationship between success of action charge practices and organizational factors (top counsel ling support, training, link to performance rating and compensation, and link to quality initiatives), and organizational culture ( gist orientation, team orientation, vigilance to detail, as nearly as transformation).They espouse a survey questionnaire method on randomly chosen business units in Australia. The findings showed that two organizational factors (top counselling support, link to quality initiatives) explained the variations in success of legal action worry practices, such as ABC, and return orientation and watchfulness to detail of organizational culture were associated with ABC success. They likewise disquieted that compared with organizational culture, organizational factors had stronger associations with the ABC. carry over 2. 1 presents a summary of the prior research discussed in this section, which highlights the factors influencing ABC success and the research method choose by each research. fudge 2. 1 A SUMMARY OF antecedent enquiry related TO ABC success IMPLEMENTATION beginning Shield (1995) method acting passel Variable behavioural, organizational, good Individual, organizational factors, technical, task and so on spot non avouch wholly the stages Anderson (1995) pillowcase 146 supranational journal of Trade, political economy and Finance, Vol. 1, No. 2, August, 2010 2010-023X technical variables Innes et al. (1995) Gosselin (1997) mass behavioural & organizational variables social structure & strategy borrowing implement ation passel word meaning & Implemen tation non fussyize not specify not specify Not specify solely the stage Implemen tation fitted from Lana and Fei 30 III. GAPS FROM PREVIOUS RESEARCH From the review of previous research, this section highlights the gaps from previous research.First, as highlighted by Lana and Fei (2007) a volume of ABC research still was make in developed countries and rattling little research has been make in growth country, especially in Asiatic conte xt. in that seefromly it is required to identify whether the Asiatic culture and way of doing business may have a polar mend on the tip of ABC adoption and implementation. Second, a majority of ABC research reviewed adoptive the behavioral and organizational variables identified by Shield 3 to investigate factors influencing ABC success. So far except one research. which was conducted by Gosselin 15 examinedthe effect of organizational structure on ABC success among Canadian business units. The importance of organizational structure effect on focus accounting practices is dysphoric by many researchers. For example, Damanpour 35 stated that whether an world can be successfully espouse or employ to some extent is stubborn by the type of structure the a firm adopts, so the modern study as well exit consider organizational structure as one of the predictors of ABC success.Third, threateningly a(prenominal) research have examined the effect of bodied culture on ABC success empirically. wherefore it is necessary to examine the association between ABC success and bodied culture, as well as how important cultural factors world power be relational to organizational, non-cultural factors 16. Forth, genuinely a couple of(prenominal) studies have investigated the effect of national cultural on ABC and so far, solely two researchers, namely, beer maker 32 and Supitcha and Frederick 33, have included this variable in their studies.Supitcha and Frederick 33 argued that national culture differences practically require successful accounting practices in one country to be modified for effective use in another country. So the influence of national culture should not be treat 32), especially in maturation countries, and differences in term of perceive ABC success could be explained by national culture. The following research gap is that some previous research did not specify the ABC implementation stage for example, Shield 3 and beer maker 32.Ac cording to Krumwiede and Roth 25, ABC implementation has sixer different stages. They are initiation, espousal, Adaption, Acceptance, Routinization, Infusion, the final two stages are considered as matured stage 25) and it is argued that at different stage, the rife factors that determine ABC success implementation are withal different. In hostel to investigate the factors influencing ABC success more accurately, the authentic research testament concentrate on one particular stage of ABC implementation that is mature stage.Finally, the selected articles show most of ABC implementation research were conducted using three-figure method such as questionnaire survey, and there are very few research used soft method (see Table 2. 1). According 147 Norris (1997) McGowan & Klammer (1997) value & Klammer (1997) Brewer (1998) Krumwiede (1998) Anderson & Young (1999) grounds check up on Behavioral & organizational Behavioral & organizational Non analyze grounds conform to gui nea pig culture Contextual & organizational organisational & contextual variables converse &survey Supitcha et al (2001) faux pas guinea pig cultureNot specify Innes et al. (2000) sartorius et. al (2000) like et. al (2003) Khalid (2003) Baird et. al (2004) Ruhanita et al. (2006) Lana & Fei (2007) Survey Behavioral & organizational variables organizational variables Behavioral & organizational variables Size, production, overhead Size, decision usefulness of cost information, culture Cost distortion, decision usefulness, IT, organizational Technical, behavioral, organizational, contextual factors organizational factors, culture organizational, technical factors Behavioral & organizational Behavioral, organizational &Adoption Survey Survey Not specify Adoption Survey Survey Adoption Adoption Survey & Case Case Adoption All the stage Baird et al. (2007) Sartorius et al. (2007) Colin et al. (2008) Majid et al. (2008) Survey Survey Survey Case Implemen tation Adoption Implemen ta tion Adoption & external diary of Trade, political economy and Finance, Vol. 1, No. 2, August, 2010 2010-023X to Cavana et al. 36, questionnaire survey of data collection often en counterpunchs problems of low rejoinder rate and to counter this problem researchers are encouraged to use multiple methods to collect data. IV.PROPOSED FRAMEWORK FOR future(a) RESEARCH As very few empirical research have been done in create countries on ABC adoption and implementation, future research should be conducted in developing nations, especially, in Asian countries such as China. Since China is one of the fastest evolution economies in the world, it would be interesting to bash if ABC success is affected by similar factors as in the westward countries. Furthermore, since joining the WTO in the year of 2001, Chinese enterprises started adopting western management accounting techniques, thus it is necessary to know the impact of Chinese culture on the ABC success.Hence the accredited study leave just focus on ABC success among Chinese manufacturing companies. Krumwiede and Roth 25 class ABC implementation into different stages initiation, adoption, adaption, acceptance, routinization, and infusion. It has been suggested in the publications that the possessive factors that determine ABC success implementation are in like manner different at different stages 20. A review of the literature shows that more research has been done to examine the determinant factors at the adoption and very few studies on implementation stage.Thus the ongoing research allow for concentrate on one particular stage of ABC implementation, especially, the mature stage (Routinization, Infusion). The latest research go away in any case examine the effect of structure on ABC success. It has been argued that in order to examine the effect of structure, the sample should come from only one perseverance. Gosselin 15 argued that different industries have different level of centralization, and formalization, and he suggested that a study should concentrate on one particular manufacture.Similarly, Rotch 37 stated that compared with manufacturing firms, non-manufacturing firms are very different in basis of characteristics. For instance, hotels are different from manufacturing firms and output of non-manufacturing firms are extremely rocky to determine. Moreover, activities in non-manufacturers, especially in service firmaments are hard to be predicted, and in like manner large balance wheel of total cost are word cost, which often unwieldy to assign to output. Similarly, Clarke, hill and Stevens 38 highlighted that significant differences exist in harm of cost structure between manufacturers and non-manufacturers.In non-manufacturing sector, ingest labor and direct material cost are close equal to zero, and inflexible overhead cost are the possessive be in the cost structure and this difference makes researching ABC masking in this type of industry more problematic. Hence the menses study testament focus on manufacturing industry only and since ABC is more presumable to be employ by bigger firms 28, this research entrust also concentrate on large sized manufacturing business. As discussed in the preceding section, previous research has not systematically examined the effects of organizational structure and organizational culture on ABC success.This motivates the current research to investigate the effects of these variables on ABC success. V. RESEARCH FRAMEWORK A. Proposed guess The current research will adopt chance possibleness and organizational possibleness to develop the research framework. misadventure possibleness has been widely adopted to conduct research in management accounting field 39-41. Contingency scheme asserts that the contrive and application of picture systems are contingent on the environment of the organizational setting in which these controls operate and function 39.It is widely used to exp lain the characteristics of management accounting system 42. Waterhouse and Tiessen 43 stated that the project and structure of management control system is contingent on number of factors there are product diversity, cost structure, size, level of competition and degree of customization 44, 45. Sartorius, Eitzen and Kamala 45 illustrated an example to explain the relationship between ABC and the eventuality factors. They stated that increasing fixed costs leads to a need for more accurate cost tryst technique such as ABC.This is especially true for firms which produce more than one products as different product products use differential amounts of resources 17. tilt is another contextual factor that leads to the emergence of more ripe be system such as ABC. In addition, large sized firms are more in all probability to adopt ABC than smaller firms due to the size of overhead, number of activities needs to be coordinated, as well as extra resources16, 45. However, adoption and implementation of an design are totally different41.Hence, Contingency theory alone may not be adequate to explain ABC implementation stage. Krumwiede 20 reason out from a survey among US firms that contextual factors may influence the ABC adoption stage while implementation stage is more associated with organizational factors. He also suggested that once a firm arrives at ABC implementation stage, it should pay attending to organizational factors. Hence, another theory should be applied to explain ABC implementation stage, which is organizational change theory 29.According to organizational change theory, changes in organizations could be sort into four categories technology, products, structure, and culture 29. Gosselin 15 categorized ABC implementation stage as the administrative procedure. Therefore, ABC could be considered as a structural change and its success is determined by top-down approach. Based on organizational change theory, Cooper and Zmud 46 divide IT innovatio n into six sequence stages 1) initiation, 2) adoption, 3) adaptation, 4) acceptance, 5) routinization, as well as 6) infusion.They also stated that at various stages the dominant factors in determining IT innovation are also different. B. interrogation exemplar In view of the discussion in the previous sections, the following framework is proposed, depicted by double 1, for this research. Prior research test the relationship between ABC success and behavioral, organizational variables, hence 148 international daybook of Trade, Economics and Finance, Vol. 1, No. 2, August, 2010 2010-023X the current research will also base on Shield 3s framework to examine the impact of behavioral, organizational variables on ABC success.In addition, it also will include two special variables, organizational culture and structure as Gosselin 15 stated that effect of organizational culture and structure on ABC success should not be ignored. also will adopt those dimensions. As for ABC success, the current study will adopt McGowan s 11 definition. McGowan 11 used four perspectives to measure Activity-Based Costing attention, namely users attitude, technical characteristics rating, perceived usefulness in upward(a) job performance and impact on organizational process. This measure subsequently adopted by Byrne et al. 49 to test ABC success implementation in Australian context. In their research, they stressed that McGowans 11definition provides the most iron measure, hence the current study will also apply McGowans 11 definition as the indicators as ABC success. source 1 2 3 4 5 Johnson, H. T. and R. S. Kaplan, Relevance wooly The rise and fall of management accounting 1987 Harvard dividing line naturalize Press Kennedy, T. and J. Affleck-Graves, The impact of activity-based be techniques on firm performance. Journal of guidance be Research, 2001. 13 p. 19-45.Shield, An empirical analysis of firms implementation experiences with activity-based be prudence expla nation Research 1995. 7 p. 148-166. Innes, J. and F. Mitchell, A survey of activity-based be in the U. K. s largest companies. precaution write up Research, 1995. 6(2) p. 137-153. Foster, G. and D. W. Swenson, Measuring the success of activity-based cost management and Its determinants. Journal of perplexity accounting system Research, 1997. 9 p. 109-141. Bjornenak, T. and F. Mitchell, The development of activity-based cost journal literature. 1987-2000. The European score Review 2002. 1(3). Majid, J. A. and M. Sulaiman, Implementation of activity-based cost in Malaysia A case study of two companies. Asian Review of accounting 2008. 16(1) p. 39-55. Banker, R. D. , I. R. Bardhan, and T. -Y. Chen, The role of manufacturing practices in mediating the impact of activity-based be on plant performance. write up, Organizations and Society, 2008. 33(1) p. 1-19. Cooper, R. and R. S. Kaplan, Profit priorities from activity-based be. Harvard agate line Review, 1991. 69(3) p. 130-135 . Swenson, D. , The benefits of activity-based cost management to the manufacturing industry.Journal of perplexity story Research, 1995. 7 p. 167-180. McGowan, A. S. , comprehend benefits of ABCM implementation. account statement Horizons, 1998. 12(1) p. 31-50. Innes, J. , F. Mitchell, and D. Sinclair, Activity-based cost in the U. K. s largest companies a equality of 1994 and 1999 survey results. commission report Research, 2000. 11(3) p. 349-362. Yanren, X. , S. Wenbin, and W. L. Thomas, Activieybased cost popularity in china. Cost Management, 2008. 22(3) p. 40-48. Shields, M. D. and M. A. McEwen, Implementing activity-based costing systems successfully.Cost Management, 1996. 9(4) p. 15-22. Gosselin, M. , The effect of strategy and organizational structure on the adoption and implementation of activity-based costing. score, Organizations and Society, 1997. 22(2) p. 105-122. Baird, K. M. , G. L. Harrison, and R. C. Reeve, Success of activity management practices the influen ce of organizational and cultural factors. Accounting and Finance, 2007. 47(1) p. 47-67. Baird, K. M. , G. L. Harrison, and R. C. Reeve, Adoption of activity management practices a note on the extent of adoption and the influence of organizational and cultural factors.Management Accounting Research, 2004. 15(4) p. 383-399. Anderson, S. W. , A framework for assessing cost management system changes the case of activity based costing implementation at general motors, 1986-1993. Journal of Management Accounting Research, 1995. 7 p. 1-51. McGowan, A. S. and T. P. Klammer, Satisfaction with activity-based cost management implementation. Journal of Management Accounting Research, 1997. 9 p. 217-237. Krumwiede, K. R. , The implementation stages of activity-based costing and the impact of contextual and organizational factors. Journal of Management Accounting Research, 1998. 0 p. 239-277. Fig 1 Theoretical Research Framework seven behavioral and organizational variables are important to cos t management practices identified by Shield and Young 24. They are 1) tweet management support 2) linkage to competitive strategies, 3) performance rating and compensation, 4) non-accounting ownership, 5) sufficient resources, 6) training in designing, implementing and using cost management system and 7) consensus astir(predicate) the clarity of the objectives of the cost management system, so current study will use all this indicators as behavioral and organizational variables.Lana and Fei 30 reviewed past empirical research just about factors influencing ABC success and summarized the technical used by prior research, they are software packages, gathering data on cost drivers, identifying activities, knowledge of data requirement and data collection, the participation of international consultants. The current study also employed Lana and Pan 30s definition and its standard for technical variables. Whether a company can adopt and implement a management innovation can be signi ficantly affected by organizational structure 35.Burns and Stalker 47 class organizational structure into mechanical and radical, mechanistic organizations have higher level of centralization and formalization than that of organic structure 15. Gosselin 15 found that ABC can be more successfully enforced in mechanistic organizations. Centralization and formation will be treated as indicators for organizational structure in current research. organisational culture still produces significant on ABC success, as muleteer 48 pointed out unaffectionate culture leads to the unsuccessful person of ABC. Baird et al. 16 used outcome orientation, team orientation, attention to detail, as well as innovation to examine the relationship between activity management success and organizational culture. And the current study 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 149 International Journal of Trade, Economics and Finance, Vol. 1, No. 2, August, 2010 2010-023X 21 Anderson, S. W. and S. M. Youn g, The impact of contextual and process factors on the evaluation of activity-based costing systems. Accounting, Organizations and Society, 1999. 24(7) p. 525-559. 22 Morrow, M. and T.Connolly, mulish problems of implementing ABC. accounting system, 1994. 113(1205) p. 76. 23 Cooper, R. and R. S. Kaplan, Activity-based systems measuring the costs of resource usage. Accounting Horizons, 1992. 6(3) p. 1. 24 Shield, M. and S. M. Young, A behavioral model for implementing cost management systems. Journal of Cost Management 1989 p. 17-27. 25 Krumwiede, K. R. and H. P. Roth, Implementing information technology innovations the activity-based costing example. surface-to-air missile Advanced Management Journal (07497075), 1997. 62(4) p. 4-13. 26 Norris, G. , The formation of managers views of ABC and their impact on the outcome of its se a grounded theory case study Accounting Research Journal 1997. 10(2) p. 180-200. 27 Sartorius, K. , C. Eitzen, and P. Kamala, Organizational Problems in re spect of the implementation of activity-based costing in southeastward Africa. Meditari Accountancy Research 2000. 8 p. 215-227. 28 Khalid, A. , Activity-based costing in Saudi Arabias fargest 100 firms in 2003. Journal of American academy of Business, Cambridge, 2005. 6(2) p. 285-292. 29 Ruhanita, M. and I. Daing Nasir, Activity based costing (ABC) adoption among manufacturing organizations the case of Malaysia. International Journal of Business and Society, 2006. (1) p. 70-101. 30 Lana, Y. J. L. and P. Fei, The implementation of activity-based costing in China an innovation action research approach. The British Accounting Review, 2007. 39(3) p. 249. 31 Mohammed, A. -O. and D. Colin, Organizational and behavioral factors influencing the adoption and success of ABC in the UK. Cost Management, 2007. 21(6) p. 38-48. 32 Brewer, P. C. , field of study culture and activity-based costing system a note. Management Accounting Research, 1998. 9 p. 241-260. 33 Supitcha, M. and H. W. Frede rick, ethnic influences on the ABC implementation in Thailands environment.Journal of Managerial Psychology, 2001. 16(2) p. 142-156. 34 Hofstede, G. , The cultural relativity of organizational practices and theories. Journal of International Business Studies, 1983. 14(2) p. 75-89. 35 Damanpour, F. , Organizational innovation a meta-analysis of effects of determinants and moderators. Academy of Management Journal, 1991. 34(3) p. 555-590. 36 Cavana, R. Y. , B. L. Delahaye, and U. Sekran, use business research qualitative and numerical Methods, ed. 3rd. 2001 John Wiley & Sons Australia, Ltd. 37 Rotch, W. , Activity-based costing in service industries.Journal of Cost Management for the Manufacturing Industry 1990. 4 p. 4-14. 38 Cllarke, P. J. , N. T. Hill, and K. Stevens, Activity-based costing in ireland Barriers to, and opportunities for, change. Critical Perspectives on Accounting, 1999. 10(4) p. 443-468. 39 Otley, D. T. , The contingency theory of management accounting Achievement and prognosis. Accounting, Organizations and Society, 1980. 5(4) p. 413-428. 40 Fisher, J. G. , Contingency theory, management control systems and firm outcomes past results and future directions. Behavioral Research in Accounting, 1998. 10 p. 47. 41 Chenhall, R.H. , Management control systems design within its organizational context findings from contingency-based research and directions for the future. Accounting, Organizations and Society, 2003. 28(2-3) p. 127-168. 42 Anthony, R. N. and V. Govindarajan, Management control system. 10th edition. 2002, raw York Mcgraw-Hill/Irwin 43 Waterhouse, J. H. and P. Tiessen, A contingency framework for management accounting systems research. Accounting, Organizations and Society, 1978. 3(1) p. 65-76. 44 Drury, C. and M. Tayles, Explicating the design of overhead absorption procedures in UK organizations.The British Accounting Review, 2005. 37(1) p. 47-84. 45 Sartorius, K. , C. Eitzen, and P. Kamala, The design and implementation of Activit y Based Costing (ABC) a confederation African survey. Meditari Accountancy Research 2007. 15(2) p. 1-21. 46 Cooper, R. B. and R. W. Zmud, development technology implementation research a technological scattering approach management science, 1990. 36(2) p. 123-139. 47 Burns, T. and G. M. Stalker, The management of innovation. 1961, capital of the United Kingdom Tavistock Publications 48 Skinner, J. , Answers on ABC. Australian Accountant, 1998. 68(2) p. 46-49. 49 Byrne, S. , E. Stower, and P.Torry. Activity based costing implementation success in Australia. 2008 cited 2008 26th August accessible from http//eprints. usq. edu. au/3719/1/Byrne_Stower_Torry. pdf. First writer Mr. Zhang Yi Fei was born on Sept 9th, 1978. He obtained his bachelor degree in Accounting from Sichuan Normal University, Cheng Du City, Si Chuan province, China in the year of 2002. He obtained his Masters in Business administration specializing in Accounting in 2005 from University Malaysia Sabah. currently he is move his PhD degree in Management Accounting at University of Malaya, Kuala Lumpur, Malaysia.Second reservoir Che Ruhana ISA (PhD) is currently an associate professor in accounting at the Faculty of Business and Accountancy, University of Malaya (UM). She joined UM as a indoctrinate in 1987 later obtaining the BBA (Accounting) from Oklahoma assert University, USA. In 1990, she gradational from London cultivate of Economics and semipolitical Science with the degree MSc in Accounting and Finance. She obtained her PhD in Accounting from University Putra Malaysia in 2005. Her current research interests are management accounting change, management accounting and performance measurement systems in public sector organizations. 150