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Profitability analysis in UK organizations: An exploratory study

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  • Drury, Colin
  • Tayles, Mike

Abstract

Recent research into management accounting practices suggests that companies are now placing considerable emphasis on profitability analysis and consider it to be one of the most important management accounting practices. There is however little recent empirical research relating to the content and role of profitability analysis in companies. This paper will address this omission and report the findings derived from a survey of UK companies relating to information that is contained in profitability reporting, generated for managing the existing mix of a firm's activities. In particular, it focuses on the nature, content and role of profitability analysis carrying out some exploratory analysis and testing various propositions to explain the divergence in observed practices.

Suggested Citation

  • Drury, Colin & Tayles, Mike, 2006. "Profitability analysis in UK organizations: An exploratory study," The British Accounting Review, Elsevier, vol. 38(4), pages 405-425.
    • Handle: RePEc:eee:bracre:v:38:y:2006:i:4:p:405-425
    DOI: 10.1016/j.bar.2006.05.003
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    References listed on IDEAS

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    1. Colin Drury & Mike Tayles, 1994. "Product costing in UK manufacturing organizations," European Accounting Review, Taylor & Francis Journals, vol. 3(3), pages 443-470.
    2. John Brierley & Christopher Cowton & Colin Drury, 2001. "Research into product costing practice: a European perspective," European Accounting Review, Taylor & Francis Journals, vol. 10(2), pages 215-256.
    3. Bhimani, Alnoor, 1996. "Management Accounting: European Perspectives," OUP Catalogue, Oxford University Press, number 9780198289661.
    4. Drury, Colin & Tayles, Mike, 2005. "Explicating the design of overhead absorption procedures in UK organizations," The British Accounting Review, Elsevier, vol. 37(1), pages 47-84.
    5. Kari Lukka & Markus Granlund, 1996. "Cost accounting in Finland: current practice and trends of development," European Accounting Review, Taylor & Francis Journals, vol. 5(1), pages 1-28.
    6. Chenhall, Robert H., 2003. "Management control systems design within its organizational context: findings from contingency-based research and directions for the future," Accounting, Organizations and Society, Elsevier, vol. 28(2-3), pages 127-168.
    7. Malmi, Teemu, 1999. "Activity-based costing diffusion across organizations: an exploratory empirical analysis of Finnish firms," Accounting, Organizations and Society, Elsevier, vol. 24(8), pages 649-672, November.
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    Cited by:

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    4. Wildauer, Rafael & Kohler, Karsten & Aboobaker, Adam & Guschanski, Alexander, 2023. "Energy price shocks, conflict inflation, and income distribution in a three-sector model," Energy Economics, Elsevier, vol. 127(PB).

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