Strategic orientation of management accounting - A case study:

Abstract: This thesis aims to study the use of management accounting in a strategic context. How management accounting was used to accentuate strategic aspects in an evaluation process was studied through a qualitative case study. A global pharmaceutical company that evaluated the future of a number of its local products, constituted the object of study. A theoretical framework based on Strategic Management Accounting (SMA) has been developed. Previous normative research and practical studies provided inspiration for the identification of five perspectives seen as prominent when management accounting is used to evaluate strategic aspects (external, long-term, collaborative, improvement and selective). Using this theoretical framework in an abductive manner, it was found that management accounting was used to accentuate strategic aspects in some situations. Strategic aspects were accentuated mainly through the application of external, long-term and collaborative perspectives by making adjustments to traditional management accounting practices. The generated management accounting information was used to communicate and report strategic aspects in the corporate hierarchy. It was, however, also found that strategic aspects were, in some situations, evaluated without the use of formal accounting analysis; strategic aspects were then discussed separately. Nevertheless, management accounting was, in these situations, occasionally used to initiate strategic discussions.