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Covaleski, M. A., M. W. Dirsmith and S. Samuel. 1996. Managerial accounting research: The contributions of organizational and sociological theories. Journal of Management Accounting Research (8): 1-35.

Summary by Michele Martinez
Ph.D. Program in Accounting
University of South Florida, Spring 2002

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Traditionally, Managerial Accounting Research (MAR) has utilized adapted versions of sociological and organizational theories in an attempt to investigate anomalies in managerial accounting practices. Consequently, this paper is an evaluation of the organizational and sociological theoretical traditions, which have been utilized throughout MAR. As a result the authors hope to facilitate a deeper understanding of such theories, while influencing greater usage by academics embracing more traditional research perspectives.

Contingency Theory

In this section of the paper the authors discuss the notion of contingency theory and what role it has played in situating control processes and structures of organizations in the context of managerial accounting. Contingency theory is "a theoretical perspective of organizational behavior that emphasizes how contingent factors such as technology and the task environment affected the design and functioning of the organizations." Based on its historical roots of the 1950s and 1960s, contingency theory represents a fusion of organizational theory and sociological functionalist perspectives of organizations. Through this blend of organizational decision-making and sociological functionalist concerns, contingency theory absorbed and took on the views of critical organizational processes such as decision-making and control. It is this explicit concern for issues of "coordination and control that has provided important contributions to MAR in ones understanding of issues (design of information and control systems, budgeting and strategic planning)."

Traditionally, the MAR utilizing contingency theory reflected and promoted the belief that decision-making should be rational, hence the managerial accounting information used by managers served as a quantitative terminology of organizational goals. However, currently accounting researchers have attempted to widen the contingency arguments to embrace the relationships between firms’ strategies and the design of their control systems.

While current and traditional contingency theory has had an overall broad influence on MAR, it has been criticized for representing a "deterministic, ahistorical view of organizations which provides limited insight as to the mediating processes of organizations."

Interpretive Perspective

Overall, the second section of this paper is concerned with the social construction and disbursement of rationality and the way in which this rationality affects the power and political structure of organizational functioning through a variety of organizational and sociological theories. The organizational and sociological theories utilized are referred to as interpretive perspectives, which also draw from the organizational decision-making perspective. Exclusively, a number of organizational and social theories including institutional theory, resource dependency theory, political perspectives, and the sociology of professions are looked at to examine the relevance of interpretive perspectives. In summary, "interpretive perspectives of managerial accounting have begun to see managerial accounting practices and information as socially constructed phenomena with the full implications of the power and politics of social construction rather than as a technically rational function driven by and serving the internal operations of organizations." Managerial accounting is seen as being implicated in the social construction of reality rather than as being passively reflective of the reality as depicted in contingency theory.

Critical Perspectives

The third section of this paper deals with the critical perspective. Explicitly, the critical perspective is concerned with the role that accounting plays in relation to issues of conflict, domination, and power as defined by the forever conflict of capitol and labor. The critical perspective provides an even more direct view of power and politics through organizational and sociological theories.

Labor Process Perspective

Labor process theorist deny that management accounting is a "neutral tool serving the general interests, of efficiency and emphasizing its role in legitimizing partisan interests, in contributing to the control and domination of labor, and in reinforcing the dominant mode of production. Labor process theory is consistent with the other organizational sociological perspectives such as contingency theory and interpretative work in the sense that it "embeds management accounting in a wider context than more orthodox approaches." However, labor process theory departs from these approaches by focusing on the "structural antagonism between classes inherent in capitalist societies."

The Foucaultian Perspective

The Foucaultian perspective remains consistent with the underlying views of the critical perspective. This perspective situates management accounting in a wider political and social context. Management Accounting is considered as part of a larger historical trend through which people are subjected to several disciplinary techniques. In contrast, labor process theory appears within the context of a class divided society. This perspective reveals management accounting as a general historical process by which people are made calculable and governable. In addition, the Foucaultian view also considers management accounting as a social practice rather than a technique.


The last section of the article provides concluding remarks in which the relationships among the organizational and sociological theories are discussed.

Summary of Concepts
Assumptions Contingency Theory Interpretive
Theory-Institutional Perspective
Critical Theory-
Labor Process Perspective
Critical Theory- Foucaultian Perspective
Purpose of Management Accounting Reflect and promote rationality in decision-making. Serves as a ceremonial means for symbolically demonstrating an organizational commitment to a rational course of action.
Develops legitimized categories.
Marxists tradition
Demonstrates the ambiguous position of mangers in accounting firms.
Contributes to the control and domination of labor.
Reinforces capitalist production.
Historical trend through which people are subjected to a variety of disciplinary techniques.
How Management Accounting is Used Quantitative expressions of organizational goals.
Passive reflection of the technology.
Technically rational function driven by and serving the internal operation of the organization.
A set of legitimizing organizations though the construction of an appearance of rationality and efficiency.
Socially constructed phenomenon with the full implication of the power and politics of social construction.
Class-divided society to aid economic expropriation.
Social practice.
People are made calculable and governable.
Social practice.


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