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Implementation of activity based costing in Malaysia


  • Jamaliah Abdul Majid
  • Maliah Sulaiman


Purpose - The study aims to document and highlight the problems and benefits of implementing activity‐based costing (ABC) in two companies in Malaysia. Design/methodology/approach - A case study methodology was used to describe the process of ABC implementation in a Malaysian based multinational company as well as a Malaysian multinational company. Findings - Although ABC is not widely adopted by companies in Malaysia, it is recognized as a valuable tool to improve the performance of these two companies. Additionally, many of the problems that hinder the implementation of ABC are related to managerial factors rather than the technical aspects of the tool itself. Several factors are pertinent to ensure the success of ABC: top management support, simplifying the ABC implementation process, sourcing suitable ABC software, and finally, ensuring that all affected employees understand and actively support the implementation process. Originality/value - The findings have significant implications for companies that want to embark on ABC. The problems highlighted may help companies planning to adopt ABC in the near future to better address these issues.

Suggested Citation

  • Jamaliah Abdul Majid & Maliah Sulaiman, 2008. "Implementation of activity based costing in Malaysia," Asian Review of Accounting, Emerald Group Publishing Limited, vol. 16(1), pages 39-55, May.
  • Handle: RePEc:eme:arapps:v:16:y:2008:i:1:p:39-55
    DOI: 10.1108/13217340810872463

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    Cited by:

    1. Abedalqader Rbaba’h, 2013. "The influence of Company Characteristics Factors to Activity Based Costing System Implementation," Journal of Education and Vocational Research, AMH International, vol. 4(2), pages 36-46.
    2. Kabinlapat, Panravee & Sutthachai, Siriluck, 2016. "An application of activity-based costing in the chicken processing industry: a case of joint products," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 20(1), January.
    3. Martha Ríos Manríquez & Clara I. Muñoz Colomina & M. Lourdes Rodríguez Vilariño Pastor, 2014. "Is the activity based costing system a viable instrument for small and medium enterprises? The case of Mexico," Estudios Gerenciales, Universidad Icesi, July.


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