Measuring management accounting practices using textual analysis

Publication Type

Journal Article

Publication Date

3-2023

Abstract

Management accounting is an important component of managerial decision-making to help guide the overall business strategy in organisations. Appropriate measures of management accounting practices (MAPs) allow academics and practitioners to assess the organisations’ MAP adoption effectively. In this study, based on qualitative information disclosed in annual reports from 2003 to 2019, we construct and validate novel and comprehensive measures of firm-level MAPs using the word embedding model Word2Vec. We illustrate the predictive validity of our measures by examining the determinants and value creation function of fitted MAPs. Our novel measures of MAPs not only provide a solid foundation for large scale sample empirical analyses of management accounting research but also pave a new way to investigate MAPs as a package.

Keywords

Contingency theory, Corporate lifecycle stages, Management accounting practices, Value creation, Word embedding model

Discipline

Accounting | Finance and Financial Management | Numerical Analysis and Scientific Computing

Research Areas

Information Systems and Management

Publication

Management Accounting Research

Volume

58

First Page

1

Last Page

16

ISSN

1044-5005

Identifier

10.1016/j.mar.2022.100818

Publisher

Elsevier

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1016/j.mar.2022.100818

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