The Evolving Role of Management Accountants in a Changing Business Environment

Abstract
The prime objective of the paper is to explain the traditional management accounting and how it
has evolved. The paper critically evaluated the role of management accountants present in the
firm for examining the change induced by using emerging advanced and sophisticated
management accounting tools and techniques in their roles. The paper assessed the roles which
was perceived traditionally to be as a controller and cost recorded and how their roles have
evolved to broader strategic roles which are important vitally in decision-making and planning.
The paper been separated into two sections where the suggestion from various scholars on the
roles being changed and not changed have been mentioned. The paper can be considered as a
modest study of various literature works for identification of reasons as to why some scholars
have suggested that the role of management accountants have changed and some disagree with
the same. The paper attempts to evaluate critically the various sets of arguments. In order to
assess their roles, the roles, activities and skill requirements of the management accountants have
been studied.
Introduction
The changes being incorporated in the recent years in the role of management accountants have
been argued strongly in the academic literature due to the development of various emerging
advanced and sophisticated management accounting (MA) systems, tools and techniques
(Guilding, Cravens and Tayles 2000; Tsamenyi, Cullen and Gonzalez 2006; Scapens and
Jazayeri2003). The emerging management accounting techniques like the balanced scorecard
(BSC), activity-based costing (ABC), strategic pricing, quality costing, strategic management
accounting (SMA), throughput costing etc. have been investigated and examined by various
researchers and academics (Atkinson, Balakrishnan, Booth, Cote, Groot, Malmi, Roberts, Uliana
and Wu 1997;Emsley 2005). The acceptance of the management accounting tools being
mentioned above and the inherent skills being demanded from the management accountants have
been argues in favor and against the motion (Yazdifar and Tsamenyi 2005; Kennedy and
Sorensen 2006).
The applications of these management accounting tools and techniques have been contributed to
the change in the roles of all the management accountants by becoming a vital member of the
organization participating in the decision-making team and being a strategic planner as compared
to the traditional functions of the cost controllers and the scorekeepers. (Seal, Cullen, Dunlop,
Berry and Ahmed 1999; Burns, Ezzamel and Scrapens 1999). The effectiveness of the
management accountants tools and techniques have been evaluated by various scholars (Haka
and Heitger 2004), and how these tools have been adopted in the firms and organization as
opposed to the counterpart traditional tools (Joshi 2001; Crenhall and Langfield-Smith 1998a).
Further the preferences and attitudes of the managers regarding the realized and perceived
benefited were also derived by various study from using the specific tools (Guilding, Cravens
and Tayles 2000; Adler, Everett and Waldron 2000).
Arguments In Favor of the Changing Role
Earlier it was seen that the management accountants were functioning as support staff for all the
decision makers but with the emergence of various tools and techniques, their roles is seen to

have evolved from serving as internal customers directly to the strategic planner and business
partners. Now that the management accountants are equal member of the decision making
system, they have the authority and responsibility for telling the operating executives and the
various types of information which they may or may not consider relevant to the business
decisions and they also have the authority to improve the quality of decisions, if they desire to do
so (Zimmerman 2009: 13).
The researchers like Emsley 2005 and Abernethy and Brownell 1999 suggest that due to inherent
relationship of Mas with diverse array of disciplines of management, it might be suggested that
the use of tools and techniques can help in expanding the tasks of management accountants from
bean counting, score keeping, cost controlling to a wider strategic and multi-disciplinary roles.
For example, the BSC or Balance Scorecard is not merely a performance measurement
framework in the organization but is used as a comprehensive strategic planning system,
sustaining the ability for transforming and improvement, enabling all the Mas in recognizing the
image of organization in customers’ eye and for focusing on the critical business processes.
(Kaplan and Norton 1992; Silk 1998).
This indirectly suggests the fact that the management accountants spend more time in
classifying, identifying activities and analyzing the costs. Further they have to allot these costs to
procurement, designing, distribution and marketing of products and services (Cardinaels et al.
2004). Therefore the accountants have to assess the system of products, marketing,
manufacturing and other work processes of the various departments (Cadez and Guilding 2008).
Additionally, it has been investigated by various manufacturing firms that a varying combination
of various tools and techniques of Mas are used for greater strategic focus (Crenhall and
Langfield-Smith 1998a).
Granlund and Lukka (1998), and Malmi (1999), investigated the transition phase in the practices
of MAs Finland and studied the transformation in their roles and responsibilities from being the
cost controllers to one of the most vital part of the managerial decision-making. The table
provided below compares the usage rate traditional as well as advanced MA techniques.

Similarly, a study by Yazdifar and Tsamenyi’s (2005) estimated that one of the most important
skill required in the Mas was the business performance evaluation. This factor continues to
remain the most important task for MAs in future. The other strategic tasks and requirements
were estimated to be planning and managing operations of the budget, cost and financial control
and profit improvement.