Accounting and Organizational Culture: A Literature Review

Running head: ACCOUNTING AND ORGANIZATIONAL CULTURE
ACCOUNTING AND ORGANIZATIONAL CULTURE
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1ACCOUNTING AND ORGANIZATIONAL CULTURE
Literature Review
Brief Summary
The work culture within an organization being immensely important, it is subject to
change with respect to the demands of the market. However, the management, while
operating these changes, frequently overlook the necessary changes that are required to do
away with the shortcomings of a traditional accounting system. Accounting systems exist and
function in a nuanced format, which has a direct bearing on organizational culture, especially
through efficient distribution of finances across various operative mediums within the
organization, which are in turn, proportionate with optimizing revenue generation through
performance. Thus, accounting systems of emerging economies tread a complicated path, the
handling of which requires certain managerial skills, which also takes into consideration the
spiritual, socio-psychological, as well as material factors pertaining to a prospective
organizational culture. The interrelation between the two variables, organizational culture and
accounting, are subject to certain key pedagogical dimensions, which seeks behavioural and
communicative changes within an organization. Accounting in this regard, takes into account
not only the financial capital, but also the intellectual capital, and their collaborated bearing
on a well-developed value proposition. Accounting helps in organizing and economizing a
company’s activities by channelizing management accounting practices, leading to the
sustainable development of the company. Hence, accounting draws largely on sustainable
dimensions. A process of ‘lean thinking’, elimination of redundant elements through
economic assessment helps in the process. Annual reports or accounts seek to improve
performativity and productivity thereby enhancing the profitability not only through
management of finances, but also that of the intellectual capital, which, although cannot be
measured on quantitative terms, still has a direct bearing on the finances (Clarke, Seng and
Whiting 2011). Thus the literature review attempts to highlight the points of commonality

2ACCOUNTING AND ORGANIZATIONAL CULTURE
and differences between the aforementioned areas of accounting and organizational culture
from a critical and theoretical perspective, especially around four specific articles. .
Common Themes
Apart from the fact that all the four chosen articles are directly related to the
managerial decisions for improvement of organizational culture based on an assessment
through efficient accounting systems and vice-versa, there are further subtle areas or themes
which are common across all of them.
A progressive organization, which integrates dynamic changes within its framework,
must also encompass modern techniques of sustainability accounting and ‘lean Management
Accounting Practices (MAP)’ which attempts to overcome the incompetence of conventional
accounting practices which were unable to keep pace with the dynamic changes, and
produced faulty information, which directly impacted the workflow of the company. Those
accounting practices are reported to allocate costs arbitrarily with short-term focus rather than
strategic accounting practices. Significant developments have been made in the fields of
finance accounting, cost accounting and management accounting, all leading to sustainability
accounting which reconsiders the social, environmental and economic risks and benefits,
bordering on the work culture within the organization, which interact with a nuanced
corporate accounting system. The paper by Fullerton, Kennedy and Widener (2014) focuses
on these management accounting practices through efficient use of ‘lean thinking’ in
manufacturing industries. Through a framework of ‘contingency theory’, which has been
referred to in the articles, it shows how strategic use of lean MAP and ‘value stream costing’
(VSC) can lead to a developed performance index for the company, along with the
empowerment of the employees (Fullerton, Kennedy and Widener 2014). Thus, it has a
significant bearing on the existing work culture within the organization, especially through
adoption of sustainable accounting techniques, which gives significant importance to