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The Association Between Activity-Based Costing And Performance: Empirical Evidence From Moroccan Companies

Author

Listed:
  • Karim Charaf

    (Groupe ISCAE, Morocco)

  • Ahmed Fath-Allah Rahmouni

    (LAREFAG, ENCGT, Abdelmalek Essaadi University, Tangier, Morocco)

  • Mohamed Sabar

    (Groupe ISCAE, Morocco)

Abstract

Research Question - Can the adoption of ABC have a positive impact on the performance of the company? Motivation - We have observed in the literature that studies on the impact of ABC on performance most often focus on financial performance. We want to explore this theme by studying, in addition to financial performance, non-financial performance. Idea - This study attempts to study the impact of ABC on performance. Data - Data was gathered using a multi-item questionnaire survey on large companies. To obtain rich data, three semi-structured interviews were conducted with management controllers. In total, 62 companies responded to the questionnaire. Tools - We used two types of tests to analyze the data: the Wilcoxon and Mann-Whitney tests and the median test. Findings - The results indicate that, overall, companies that have adopted ABC have improved their performance significantly. Indeed, its adoption has a positive effect that is more important than the traditional method on the non-financial performance of companies. However, a direct relationship between ABC and financial performance has not been confirmed. Contribution - Previous studies have focused on the effect of ABC on financial performance with inconclusive results. Our contribution has been to demonstrate the positive impact of ABC on non-financial performance. We have also concluded an indirect relationship between ABC and financial performance, which happens precisely through improving non-financial performance. We also concluded the importance of the time variable in evaluating the link between ABC and performance. The expected benefits from ABC depend on time and cannot be delivered immediately and simultaneously.

Suggested Citation

  • Karim Charaf & Ahmed Fath-Allah Rahmouni & Mohamed Sabar, 2022. "The Association Between Activity-Based Costing And Performance: Empirical Evidence From Moroccan Companies," Journal of Accounting and Management Information Systems, Faculty of Accounting and Management Information Systems, The Bucharest University of Economic Studies, vol. 21(1), pages 25-50, March.
    • Handle: RePEc:ami:journl:v:21:y:2022:i:1:p:25-50
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    References listed on IDEAS

    as
    1. Banker, Rajiv D. & Bardhan, Indranil R. & Chen, Tai-Yuan, 2008. "The role of manufacturing practices in mediating the impact of activity-based costing on plant performance," Accounting, Organizations and Society, Elsevier, vol. 33(1), pages 1-19, January.
    2. Witchulada Vetchagool & Marcjanna M. Augustyn & Mike Tayles, 2020. "Impacts of activity-based costing on organizational performance: evidence from Thailand," Asian Review of Accounting, Emerald Group Publishing Limited, vol. 28(3), pages 329-349, May.
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    4. Azzouz ELHAMMA & Zhang YI FEI, 2013. "The Relationship between Activity Based Costing, Business Strategy and Performance in Moroccan," Journal of Accounting and Management Information Systems, Faculty of Accounting and Management Information Systems, The Bucharest University of Economic Studies, vol. 12(1), pages 22-38, March.
    5. Trond Bjørnenak & Falconer Mitchell, 2002. "The development of activity-based costing journal literature, 1987-2000," European Accounting Review, Taylor & Francis Journals, vol. 11(3), pages 481-508.
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    More about this item

    Keywords

    Activity-Based Costing; performance; management accounting; performance dimensions;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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