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Relevance Lost: Rise and Fall of Management Accounting
£1.50
“Relevance Lost” is an overview of the evolution of management accounting in American business, from textile mills in the 1880s and the giant railroad, steel, and retail corporations, to today’s environment of global competition and computer-automated manufacturers. The book shows that modern corporations must work toward designing new management accounting systems that will assist managers more fully in their long-term planning. It is the winner of the American Accounting Association’s Deloitte Haskins and Sells/Wildman Award Medal. It is also available in hardcover.
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Additional information
| Publisher | Harvard Business Review Press, New edition (1 Mar. 1991) |
|---|---|
| Language | English |
| Paperback | 272 pages |
| ISBN-10 | 0875842542 |
| ISBN-13 | 978-0875842547 |
| Dimensions | 15.88 x 2.54 x 23.5 cm |
by Angus Jenkinson
this is one of the pioneer works in the development of ABC costing, finance, and directs management towards the tools of analysing money and cost flows in a business rather than the static functional summaries that are the norm. Much more powerful management system.
by Mojca
yes.
by Nick Dougan
This is one of those books that is, I suspect, more referred to than actually read, being a precursor to one of the author’s subsequent extensive work on “The Balanced Scorecard” and a general reassessment of the role of management accounting that continues today.
The authors’ hypothesis, stated in the first sentence, was that management accounting information of the day (1986) was “too late, too aggregated and too distorted to be relevant for managers planning and control decisions”. They proceed with a history of the development of management accounting techniques from the early nineteenth century, and business enterprises in Britain and the US became much bigger and more integrated than they had been. It’s quite fascinating to see how quite sophisticated techniques to support management control and decision making were developed unencumbered by the need for rigorous financial accounts to be presented to shareholders and the outside world. Johnson and Kaplan proceed to show how, as those external reporting requirements grew management accounting was compromised by the need to make use of data collected for this different (and often, the authors suggest, futile) purpose.
My particular interest was to learn what they had to say about “nonfinancial indicators”, which is one of the foundation of the balanced scorecard and other recent strategic management accounting techniques; the section actually devoted to these was actually quite short – a half dozen pages at the end. Nevertheless, I am delighted to have added this seminal work to my library, and (assuming you are interested in the development of accountancy!), if you get the chance to pick up a second hand copy yourself I’d snap it up!