Towards Implementation of Sociology Theory on Management
Accounting Research
Sofik Handoyo and Syaiful Anas
Faculty of Economics and Business, Universitas Padjadjaran, Bandung, Indonesia
Keywords: Management Accounting, Sociological Theory, Economics Theory, Management Accounting Techniques.
Abstract: This article aims to give another perspective for Management accounting scholars to potentially implement
sociology theories in theirs accounting researchers. Traditionally, accounting researches have been conducted
relying on accounting theory, management theory, economics theory and psychological theory. However, in
line with popularity academic research that involves interdisciplinary field of study, it is therefore open
possibility to adopt another perspective of theory from related discipline. Since Management accounting
discipline is closely associated with organization and behavior of individual within the organization, sociology
theory is considered fit to be adopted. This article will figure out potential research in management accounting
discipline using framework sociology theory.
1 INTRODUCTION
Management accounting is branch of accounting
study that mainly focus on how accountant provide
information for decision making, organizational
planning, controlling and performance
measurements. Mostly, people understand
management accounting discipline that is identically
with quantitative data and business and economics
theory. However, actually in major part of
management accounting is dealing with social
context originated from sociological and
psychological field of study. In line with advanced of
information and technology, accountant function as
information provider decision making slow but sure
replaced by machines. The challenges of management
accountant in today’s business environment are
technology adaptation and empowering member of
organization to achieve maximum benefits for the
organization. Therefore, social aspect that appears
between member of the organization is obvious.
After a long period of neglect, the roles of
accounting in shaping the economy are currently
being rediscovered by sociologists (Miller, 2007).
Across the following two decades, the researches that
are involving interactions between sociology and
accounting enormously developed. The sociological
analysis of accounting came to be located more
within the discipline of accounting, and in the process
the concepts used and the definition of the object of
attention itself altered (Miller, 2007). Since
accounting was identified as a proper object of
sociological analysis and the ground was already laid
within sociology and organization theory, the analysis
of the institutional environments of accounting is
widely increasing (Miller, 2007).
Historical studies have played an increasing role
in economics and sociology, which provide
theoretical bases for management accounting
research (Luft, 2007). Organizational and
sociological theories explicitly recognize the
centrality of issues of social control and coordination
in organizations, thus providing intellectual
approaches from which to study managerial
accounting as important aspects of the manner in
which organizations and society function (Covaleski
et al., 1996). However, many researches in
accounting and management accounting are majority
based on economic and business theory. Accounting
and management accounting are tool to help business
organization achieve their goal. However, success
and failure of those tool is very much depending on
the executor. Therefore, today’s management
accounting research should not only focus on
implementation of management accounting
techniques but also actors who implemented the
techniques.
Since studying people in organization is closely
associated with social context, therefore there is
Handoyo, S. and Anas, S.
Towards Implementation of Sociology Theory on Management Accounting Research.
In Proceedings of the 2nd International Conference on Sociology Education (ICSE 2017) - Volume 2, pages 313-317
ISBN: 978-989-758-316-2
Copyright © 2018 by SCITEPRESS – Science and Technology Publications, Lda. All rights reserved
313

urgency to adopt and implement sociology theory to
conduct research in management accounting. In this
paper, several sociology theory and potential research
topic relevance with management accounting was
discussed and explained. It is expected that the
description will give an inspiration for researchers in
management accounting study to conduct research in
the area of social context. Additionally, by adopting
theory from other disciplines, it will open possibilities
to conduct collaboration research with other scholar
cross field of study. There is increasing acceptance of
the contributions that can be made by researchers
working at the interface of management accounting
research and sociology. By building on these existing
links, we can enrich both management accounting
research and the discipline of sociology (Miller,
2007). Additionally, sociology theory described in
this paper is expected can contribute to enrich horizon
of accounting scholars besides economics and
business theory that are already widely known
previously.
2 LITERATURE REVIEW
2.1 Sociology Theory in Management
Accounting Research
Roslender (1995) offers an introductory review of
critical Management Accounting Researches. He
identifies self-awareness as its basic purpose and
stresses how it can help management accountants
understand their position in organizations and society,
and the effects of their calculative techniques. He
points out that in the best Management Accounting
research, researchers are aware of the impact of their
studies. He identifies several theoretical approaches
that emphasize awareness namely interpretive
sociology, political economy, labor process and
critical theory. The design of management accounting
research is guided by economic principles, however,
the social context of the firm and the mutability of
management accounting suggest that other social
sciences (e.g., sociology, psychology, political
science) offer equally compelling explanations for
observed practice.
Sociology theories provide more explanation for
the beyond organization level of a complete model of
management accounting than psychology and
contingency theories do. Some sociology theories
focus on events while others focus on attributes, and
linking events and attributes remain problematic
(Luft and Shield, 2007). A set of constructs derived
from anthropology, social psychology, and sociology
to explain and predict how people function in a social
context (Birnberg et al., 2007). Managerial
accounting research, which has adapted
organizational or sociological theories to examine the
development, maintenance and change in managerial
accounting practices, explicitly recognizes the
centrality of issues of social control and coordination
in organizations, thus providing intellectual
approaches from which to study managerial
accounting as problematic aspects of the
organizational and social context (Covaleski et al.,
1996). The sociology theories employed in
management accounting research often focus on
beyond organization variables, both attributes of
societies (e.g., discourse, symbolic values) and events
that occur similarly across a whole society (e.g.,
capital-labor conflict, resistance to management
accounting (Luft, and Shield, 2001).
It seems likely that theories and methods drawn
from anthropology and sociology are more suited to
understanding how these subtle factors combine to
influence how individuals respond to MCS
(Chenhall, 2007) and various streams of sociology
that have been used in MCS research (Chenhall,
2007). Accounting, in the sense of both budgetary
management and capital accounting, was central to
his analysis of the sociological conditions of
economic activity. He argued that money is ‘the most
‘‘perfect’’ means of economic calculation, that is,
‘formally the most rational means of orienting
economic activity’. Calculation in terms of money,
rather than its actual use, was the mechanism by
which rational economic provision could be
conducted, and capital accounting was the form of
monetary accounting peculiar to rational economic
profit-making.
2.2 Structural Functionalism Theory
Structural functionalism, or in many contexts simply
functionalism, is a broad perspective in sociology and
anthropology which sets out to interpret society as a
structure with interrelated parts. Functionalism
addresses society as a whole in terms of the function
of its constituent elements; namely norms, customs,
traditions and institutions. Structural Functional
Theory in management accounting is identical and
widely known as contingency theory. The
sociological tradition embedded in contingency
theory developed during the 1960s through various
structural approaches to organizational studies
(Covaleski et al., 1996). Contingency theory
represents a rich blend of organizational theory it has
roots in the organizational decision-making
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perspectives and sociological functionalist
perspectives of organizations, it has roots in the
sociological concerns about organizational structure
(Covaleski et al., 1996)
Contingency theory took the insights on such
critical organizational processes as decision making
and control as depicted in the literature on
organizational decision making and combined these
with sociological functionalist concerns regarding the
impact of such structural factors as environment, size,
technology, etc., on organizational behavior.
Contingency theory is essentially a theoretical
perspective of organizational behavior that
emphasizes how contingent factors such as
technology and the task environment affected the
design and functioning of organizations. (Covaleski
et al., 1996). These contextual factors are
hypothesized to influence dimensions of structure
including the degree of formalization, specialization,
differentiation and bureaucratization. (Covaleski et
al., 1996). These studies suggested that organizations'
structures are contingent upon contextual factors
which have been variously defined to include
technology, dimensions of task environment and
organizational size (Covaleski et al., 1996)
Among the earliest managerial accounting
research which adopted a contingency perspective
was Hofstede's in 1967 classic field work which
found that economic, technological and sociological
considerations have a significant impact on the way
budgeting systems function, concluding that
managers used budgetary information in difficult
economic environments to pressure workers; but in
more lucrative environments, the budget was used
more in a problem solving mode (Covaleski et al.,
1996). Traditional management accounting research
which has been based in the contingency literature (as
well as its predecessors—organizational decision
making, human relations and scientific management)
suggests that managerial accounting information
should reflect and promote rationality in decision
making.
Important to both the decision-making
perspective of organizations and the sociological
concerns for organizational structure are issues of
organizational control and coordination (Covaleski et
al., 1996). Organizational decision-making
perspective with the sociological functionalist
concerns regarding the impact of such structural
factors as environment, size, technology, etc., on
organizational behavior. Implementation in
management accounting research in the context using
contingency theory or structural functional theory
such as the influence of characteristic organization
(industry classification, size, age, profile) in
determining successful implementation of
management accounting techniques. Characteristic
organization is also relevant used to conduct research
about voluntary and mandatory sustainability
reporting disclosure. Another perspective
implementation of structural functional theory in
management accounting research is key factors in
determining management control system in
organization. The factors refer to structural
organization, distribution of power and compensation
management.
2.3 New Institutional Sociology Theory
In recent years’ institutional theory has had a major
impact on research in a wide variety of fields within
the social sciences, including economics, sociology,
political science, organizational theory, public
administration, and also accounting (Scapens and
Varoutsa, 2010). In the accounting literature three
particular types of institutional theory have had
significant influences on accounting research, and
especially on management accounting research.
These are generally referred to as new institutional
economics (NIE), old institutional economics (OIE)
and new institutional sociology (NIS) (Scapens and
Varoutsa, 2010)
In general, NIS asks how organizations are
influenced by the institutions in their environments.
Much of the research documents the impact of the
state and professions on organizations, and traces the
diffusion of new organizational forms and practices
(Scapens and Varoutsa, 2010). The focus of much of
this work is on how institutions shape the patterning
of organizations and lead to homogeneity in
organizational fields (Scapens and Varoutsa, 2010).
According to NIS, it is the search for legitimacy and
resources that explains why specific organizational
forms and procedures are diffused across
organizations operating in similar settings – e.g.
similar environments, societal sectors, or
organizational fields (Scapens and Varoutsa, 2010).
This process of diffusion can create pressures that
lead organizations to become isomorphic with other
organizations in their institutional field. Competitive
isomorphism, for instance, through market forces, is
not dismissed, but the emphasis is placed instead on
three types of institutional isomorphism namely
coercive, normative and mimetic isomorphism that
highlight the social and political dimensions of the
environment in which organizations are located
(Scapens and Varoutsa, 2010).
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The early NIS work tended to emphasize the
structural nature of institutions. In other words, how
organizations are molded by institutional forces;
forces which are external to the organization. Rather
less attention was given to the way in which
institutions are created and how institutions change
(Scapens and Varoutsa, 2010). NIS to explore how
organizations respond to pressures from the
institutional environment and that organizations are
not necessarily passive, they can act strategically in
their response to institutional pressures (Scapens and
Varoutsa, 2010) Organization may purposefully
comply with external requirements by adopting
specific formal structures and procedures, but in a
manipulative fashion, in order to gain legitimacy and
thereby secure the resources which are essential for
their survival (Scapens and Varoutsa, 2010). recent
work in NIS has begun to explore the processes which
shape practices within organizations
Implementation of NIS in management
accounting research is to study about management
accounting practice such as adoption of strategic
management accounting techniques. Practice in
business organization showed that adoption strategic
management accounting techniques is increasing.
NIS can be applied to understand the nature of
adoption of strategic management accounting
techniques. Why certain management accounting
techniques is adopted and neglected other is
fundamental research question that can be answered
using NIS. Another perspective of adoption of NIS in
management accounting research is understanding
behavior of organization that following others
organization in terms of adoption certain
management accounting techniques considered
successful. In order to get detail understanding about
the behavior, qualitative method of research is
suggested.
2.4 Actor Network Theory
Actor-Network Theory (ANT) enables researchers to
explore inter-connections between accountants,
inscriptions and the technology they use and how
accounting intercedes local actions. (O’Connell et al.,
2014). Everything in the social and natural worlds
does not exist separately, but is being constantly
generated by relationships between actors in
networks (Law, 2007). ANT explains how, over time,
networks of actors are built to support claims to
specific knowledge by those who use accounting
numbers and reports in an effort to persuade and
influence (Mouritsen et al., 2001)
Alongside other sociological method theories,
ANT has thus changed our understanding of
management accounting from the consideration of
only technical and functional system characteristics
to the study of the social and organizational contexts
in which accounting operates (Lukka and Vinnari,
2005). The fundamental premises of ANT may be
expressed in terms of four key notions: actors,
translation, alliances and trials of strength. An actor
is defined as any human or non-human thing which
has an effect on another thing (Lukka and Vinnari,
2005). ANT is considered particularly suitable for the
study of innovations (Lukka and Vinnari, 2005)
Another branch of ANT-inspired management
accounting research has investigated processes
related to the fabrication or implementation of various
innovations such as Activity-Based Costing, the
Balanced Scorecard and ERP (Lukka and Vinnari,
2005). ANT has been used by accounting researchers
to provide insights into the organic nature of change
(O’Connell et al., 2014). ANT specifically examines
how networks are developed and maintained and the
interacting role of the various actors (human and non-
human) within these changing accounting processes
(O’Connell et al., 2014).
Actor Network theory fits perfectly to
management accounting research about management
accounting changes. Nowadays, business
environment is changing quickly and adoption
management accounting techniques follows the trend.
Historically, adoption management accounting in
business practice is changing gradually. However,
Motive and reason why business practice tends to
change their management accounting techniques is
still mystery. Therefore, there is urgency to
understand behavior among industry practice
regarding changing the management accounting
techniques. Actor Network Theory will provide
answer the motive of changing from perspective
internal organization (Actor) and External
organization (Network). Qualitative research is
suggested in order to get detail understanding of the
behaviour.
3 CONCLUSIONS AND
DISCUSSION
Management accounting is field of study that is not
merely related with quantitative data. In line with
advanced of information technology, role of
management accountant as information provider for
decision making is reduced and replaced by
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technology. However, challenges of management
accountant in assisting organization to achieve its
business objective are still existing. Management
accountant is forced to make sure process serial
process of planning, budgeting, controlling and
performance measurement functional properly.
Those serial process is heavily about interaction with
member of organization. Therefore, understanding
social context is urgently required by management
accountant. Sociology theory is believed as relevant
theory to understand nature of human behavior in
organizational context.
Structural Functionalism theory or contingency
provide framework in management accounting
research that there is no single management
accounting technique that fits to all organization. It is
very much depending on many factors that make
implementation has different impact in one
organization to another organization. New
Institutional Sociological (NIS) Theory posits that
there are institutional factors that influence why
certain organization adopt certain management
accounting techniques. NIS is basically asking
motive behind in decision making in organization.
Lastly, Actor Network Theory (ANT) is framework
of management accounting research about
innovation. ANT is best theory suggested to be
adopted to understand behavior among business
organization related management accounting
changes.
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