Summary of PhD thesis in Accounting: The factors impacts on the application of management accounting techiques wthin enterprises in northern Vienam

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INTRODUCTION
1. Rationales
In the opening and integrating trend, Vietnamese businesses are facing
fierce competition within domestic enterprises as well as with foreign companies.
Vietnamese enterprises need to prepare in different aspects including capital,
technology, equipment and effective enterprise administration to stand firm and
prevail in this competition. In order to improve management efficiency and help
these companies to have their high positions in the competition, administrators
need to be equipped with modern management knowledge supported efficiently by
information of management accounting. It is significantly neccessary to conduct
research studying the actual situation of management accounting application as
well as factors’ impact on this application in enterprises so that appropriate
recommendations to promote management accounting’s development in
enterprises could be suggested. As a result, the author selected the thesis topic
named "The factors’ impacts on the application of management accounting
techniques within enterprises in northern Vietnam ".
2. Research objectives
The main research objectives of the topic are the actual status of management
accounting application in enterpries in northern Vietnam and the impact of a few
factors on this situation. To be specific, the topic was conducted with the aim of
achieving following objectives:
- Assessing the status of implementing management accounting techniques in
enterprises in northern Vietnam.
- Studying factors affecting the application of management accounting
techniques in enterprises in northern Vietnam.
3. Research questions
How are techniques related to management accounting applied by companies in

northern Vietnam?
How do selected factors influence the application of management accounting
techniques in enterprises in northern Vietnam?
4. Research subject and scope
* Research subject
- Actual situation of applying some management accounting techniques in
enterprises in Northern Vietnam.
- The relationship between a number of factors with the application of
management accounting techniques in enterprises in Northern Vietnam.
* Scope of the research

The research selected a few companies to study the status of management
accounting application. The selected enterprises should be divided differently
according to sectors, fields, types of ownership, scale and headquarters located in
northern Vietnam’s provinces.
5. Research Methods
The author used both qualitative research methods and quantitative research
methods to conduct the research.
Qualitative research was carried out through in-depth interviews and discussions
with experts for better understanding of research issues, which would identify the
scope of research, select independent variables and dependent variables in order to
build up research model, design questionnaires, research procedure as well as analyse
data.
Quantitative research consisted of 2 parts: preliminary quantitative research and
core quantitative research. The purpose of preliminary quantitative research was to
find out inappropriate points in survey questions and evaluate the reliability of the
scale before conducting core research. Official research was conducted to collect data
for the purpose of quantitative analysis. The revised questionnaire will be sent to
enterprises listed in the survey sample to synthesize data. Collected data will be
cleaned for factor analysis, correlation analysis, model verification and research

hypotheses by software SPSS 22.
6. Contributions of the research
- In terms of academic, theoretical aspect: The thesis synthesized important
researches about the relationship of some factors with the implementation of
management accounting in companies. In addition to using contingency theory to
explain and select independent variables in the research model, the thesis also applied
institutional theory to explain the low level of using management accounting in
enterprises in northern Vietnam.
- In terms of practice: The thesis researched and pointed out the status of
implementing management accounting in enterprises in northern Vietnam. Research
results illustrated that most enterprises apply techniques in management accounting at
a low level compared to other countries in the region and the world.
The thesis established research model and studied the factors’ influence on the
application of management accounting techniques in northern Vietnam’s enterprises.
These factors in the thesis model included: competitive pressure, administrative
decentralization in enterprises, the frequency of using IT, the rate of managers’interest
in management accounting as well as accountant’s professional qualifications.
Research results indicated that all of the factors listed in the model affected the
management accounting in enterprises in northern Vietnam.


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- New recommendations suggested from research results: Based on the
results, the author suggested recommendations to enhance the application of
management accounting in enterprises and thereby improve business management
efficiency.
7. Research structure:

In addition to the introduction, the thesis consists of 5 chapters:
Chapter 1: Research background of the thesis
Chapter 2: Theoretical framework of management accounting
Chapter 3: Research methods
Chapter 4: Research results and discussion
Chapter 5: Conclusion and recommendations

factors. Research objectives of above thesises were management accounting
techniques including traditional techniques and modern techniques. However, the
quantity and names of those techniques in each study were also very
different.Studies were carried out in various businesses, in different geographical areas
and in different economies in developed and developing countries. So far, there have
been 3 research projects about management accounting in Vietnam. Nevertheless, the
research of Nishimura (2005) and Nguyen Thi Phuong Dung (2014) only focused on
identifying the actual stage of management accounting in Vietnamese enterprises in
the process of developing management accounting. Similarly, Doan Ngoc Phi Anh
(2012) only studied the possibility of using western management accounting for
Vietnamese businesses. Although the purposes and methods of those researches may
be similar, the research objectives and the time conducting studies were different;
consequently, the results were quite different. Moreover, there have not been any
projects in Vietnam working fully on the status of management accounting application
as well as factors’ influency regarding companies working in several business aspects,
which is the gap for research.

CHAPTER 1
RESEARCH BACKGROUNDS RELATED TO THE THESIS
1.1. Researches on the status of application of Management Accounting in enterprises
The thesis reviewed domestic and foreign studies about actual situation of
Management Accounting application. From this, the author synthesized results from
identical research projects in and outside Vietnam regarding the status of management

accounting application in enterprises.
1.2. Researches in terms of factors affecting the application of management
accounting techniques
The thesis reviewed domestic and foreign studies about actual situation of
Management Accounting application. From this, the author synthesized results from
identical research projects in and outside Vietnam regarding the status of management
accounting application in enterprises.
1.3. Conclusion about previous studies and research gaps
Studies related to the topic were divided into two main groups. The first
group included studies focusing on the status of management accounting
application in enterprises without studying the effects of factors on this application.
The second group consisted of researches studying both the status of the application
and the factors’ impact on it. In terms of theoretical framework, those researches
was mainly based on the contingency theory of Otley (1980) and the diffusion of
innovations. Regarding researches’ purposes, they all worked with the aim of
studying the status of management accounting application in enterprises as well as
factors impacts on this application. Regarding research methods, in addition to
some researches using qualitative research methods such as authors (Armitage &
Webb, 2013), the remaining researches applied quantitative research methods using
the Likert 5-point scale to determine the application’s situation and influencial

CHAPTER 2
THEORETICAL FRAMEWORK OF MANAGEMENT ACCOUNTING
2.1. The process of developing Management Accounting
The management accounting development was divided into 4 main periods
by IFAC (1998, p.84): Period I was from earlier until 1950, management
accounting was called as cost accounting (Wilson and Chua, 1988). Characteristics
of techniques developed during this period focused on identifying costs and
financial control such as standard costs, cost estimation, department reports,
breakeven analysis techniques, systems assessing the departments’ productivity,

transfer pricing method, financial performance indicators such as ROI, ROE, ROA,
etc. (Kaplan, 1984). The second period was ranging from 1950 to before 1965, the
major points of this period switched to techniques for planning and control (AbdelKader, 2006). Techniques developing in this period included information analysis
techniques for decision-making progress and activity accounting. Period III was
from 1965 to before 1985 in which the change of production technology and the use
of computers in automation processes changing the cost structure made the
traditional cost allocation methods no longer available, as a result, the activity-base
costing method was proposed by Kaplan and Norton. Regarding the forth period
from 1985 until now, management accounting concentrated on providing
information to use resources efficiently and support the strategies implementation.
Management accounting techniques aimed to create added value for customers,
shareholders and enterprises innovation.


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2.2. Content and techniques of Management accounting
2.2.1. Definition of Management Accounting:
There have been different definitions of Management accounting (Drury,
2012). According to the American Accounting Association, Management Accounting
was the process of identifying, measuring and communicating information which
allowed information’s users to evaluate and make decisions. According to Nishimura
(2005), Management Accounting played the role of providing information for
managers to make decisions, set plans, control and measure operation efficiency.
2.2.2. Management Accounting techniques
Based on the list of techniques which were used by Chenhall & Langfield-Smith
(1998), Luther & Longden (2001), El-Ebaishi et al (2003), Wu et al (2007), Doan
Ngoc Phi Anh (2012) together with Management Accounting techniques taught

popularly in Vietnamese universities, there were some techniques chosen for this
research, which included:
- Decision support techniques
- Cost accounting techniques
- Performance measurement system
- Types of estimates
- Strategic management accounting techniques
2.3. Theories applied in the research of Management accounting
2.3.1. Institutional Theory
Institutions are formal and informal rules, monitoring and enforcement
mechanisms, and value systems defined in the context in which the organizations
operate and interact with each other. Applying institutional theory to explain the
enterprises’ application of management accounting techniques, Scapens (1993)
considered management accounting as a set of rules and habits, along with other
organizational rules and habits, which allows copying and is associated with
organizational life (Scapens, 1993). In the increasingly competitive environment and
scarce resources, enterprises must find ways to improve business efficiency through
effective decisions based on appropriate information. The need for information which
was suitable for making decisions had motivated businesses to build and apply
management accounting techniques. According to the mimetic processes, the
efficiency in the decision-making process based on management accounting
information of companies also spread to other enterprises, which made them imitate
the same way (normative pressures). Imitating large enterprises with strong influence
would increase the ability to be accepted and thus increase the viability (Nguyen Van
Thang, 2015, p.42). After acknowledging the effects and necessity of management
accounting techniques in improving business performance, the normative pressures

would help companies approach and apply management accounting techniques with
models which were conducted successfully by previous enterprises.
Institutional theory also refers to the matter of power under two perspectives:

the power of employees in proposing and introducing new management accounting
techniques based on the need to implement the plan, long-term goals as well as
companies resources. On the other hand, the introduction of new management
accounting techniques would encounter resistance of forces that hindered the
adoption of new technologies, which was in the form of "the power of system", with
the aim of maintaining inherent stability and counteracting the change which was
challenging them (Burns, Ezzamel, & Scapens, 1999).
2.3.2. Contingency Theory
Contingency theory was developed and mentioned in organization’s documents
around the early 1960s. During the mid-1970s, this theory was used by many studies to
select and explain the effects of a number of uncertain indicators on the management
accounting application of enterprises (Selto et al, 1995; Chenhall & Langfield-Smith,
1998; Chenhall, 2003).
The basic argument in contingency theory recommended by Otley (1980) in the
research on management accounting was "there was no theoretical model which could
fit for all kind of organizations." Each organization had its own characteristics of
operation objectives and operating environment; therefore, it was necessary to
establish an organizational model suitable for their activities (Otley, 1980).
CHAPTER 3
RESEARCH METHODS
3.1. Hypothesis and research model
Hypothesis H1: Competitive pressure had a positive impact on the application of
management accounting techniques.
Hypothesis H2: Decentralization in enterprises had a positive influence on the
application of management accounting techniques.in enterprises.
Hypothesis H3: The actual status of using information technology had a positive
effect on the application of management accounting techniques in enterprises.
Hypothesis H4: The level of administrator’s interest in management accounting
has positively impacted the application of management accounting techniques in
enterprises.

The theory of H5: Accountant’s professional qualifications had a positive
influence on the application of management accounting techniques in enterprises.
The hypotheses were linked according to the research model as diagram 3.1


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Diagram 3.1. Research model
In the above model, there are independent variables and dependent variables.
Independent variables include the following factors namely Competitive
pressure, Decentralization’s level, The status of information technology application,
The level of administrator’s interest in management accounting, Accountants’
professional qualifications.
Dependent variable is the status of applying management accounting techniques
in enterprises.
3.2. Research Methods
The thesis used both qualitative research methods and quantitative research
methods.
3.3. Variables selection in the research model
3.3.1. Independent variables selection
From the original research model based on Contingency theory and with
reference to previous studies, the author discussed with experts about the relevance,
possibility and meanings of independent variables in the research model. Selected
independent variables in the model were Competitive pressure, Decentralization’s
level, The status of information technology application, The level of administrator’s
interest in management accounting, and Accountants’ professional qualifications.
3.3.2. Dependent variables selection
Management accounting techniques is a term which refers to techniques and tools

used to collect and analyze information with the aim of serving management functions
and management decision-making process in enterprises. In order to make a method or

technique popular, user must understand fully its usage as well as its benefits. Therefore,
based on research materials, especially the study by Doan Ngoc Phi Anh (2012) as well
as the discussion with experts about management accounting methods, which were
taught in universities, colleges and were applied widely in Vietnamese businesses, the
thesis selected Management accounting techniques for the research model as
followings:
Table 3.1. Selected methods / techniques
Classified by
Classified by
2
Methods / techniques
function
function
1
Price from variable cost
C
Cost accounting
2
Target cost
C
Cost accounting
3
ABC
C
Cost accounting
4
Production cost estimation

B
Planning
5
Sales cost estimation
B
Planning
6
Profit estimation
B
Planning
7
Budget estimation
B
Planning
8
Financial report estimation
B
Planning
9
Product profit analysis
D
Deciding
10 CVP analysis
D
Deciding
11 Analysis estimations’ gaps
D
Deciding
12 Standard cost and gaps analysis
P

Evaluating
13 Department profit
P
Evaluating
14 Non-Financial Measures
P
Evaluating
15 Long-term forcast
S
Strategy
Capital cost estimation (Payback,
Strategy
16 ROI)
S
17 Capital cost estimation (NPV, IRR)
S
Strategy
18 Value chain analysis
S
Strategy
19 Balance sheet
S
Strategy
20 Life cycle costing
S
Strategy
Notes: B (Budgeting); C (Costing); D (Decision); P (Performance); S (Strategy).
3.3.3. Scale
The author used scales of previous studies to measure independent
variables and dependent variables: Chenhall & Langfield-Smith (1998), Halma

and Laats (2002), Abdel-Kader and Luther (2008), Karanja et al. (2013),
Sulaiman et al. (2015), etc.
3.4. Questionnaire establishment
The questionnaire was designed based on the questions which were used by
previous authors such as Chenhall and Langfield-Smith, 1998; Wijewardena, 1999;
Joshi, 2001; Hyvonen, 2005; Ahmad, 2012; Yalcin, 2012. This form was used by many
research (Yalcin, 2012; Ahmad, 2012). The questionnaire consisted of three parts
including Part 1. General information of the companies and respondents; Part 2: Survey of

Competitivenes

H1

Decentralization

H2

Information
technology

H3

Administrator
interest

H4

Accountant
qualificationss

Management
Accounting

H5


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the application of Management Accounting in companies; Part 3: Factors affecting the
application of Management Accounting in companies.
3.5. Selection of the sample and sample size
According to Nguyen Van Thang, if the population size is large and it is
impossible to identify the accurate value, the size can be calculated via this formula:
z2( p*(1- p)
n=
e2
In which:
n = sample size
z = the distribution value corresponding to the selected confidence rate (if the
confidence rate is 95%, the value of z will be 1,96…)
p = the estimate of the population’s percentage (which usually is 50% - the
population’s highest probability of occurring)
e = tolerance (+-3%, +-4%,+-5%...).
If the confidence rate is 95%, the research sample scale is calculated according
to the above formula with 384 observations divided by a population of more than 10
millions (Thang, 2015b). According to that formula, the research will be required to
use 384 observations.

483 questionnaire forms were polled and after the clearning (eliminating forms
with duplicated answers, inappropriate replies,conflicted responds…), 437 eligible
forms were encoded and analyzed with the statistical system named SPSS 22.
Table 4.1. Characteristics of surveyed companies

CHAPTER 4
FINDINGS AND DISCUSSION

4.2. Status of the application of Management Accounting in Northern Vietnam
enterprises
Findings demonstrate the status of the application of Management Accounting in
Northern Vietnam companies which is presented as below:
4.2.1. Status of the application of some cost accounting methods
In the three surveyed cost accounting methods, variable costing has the highest
application rate being 26.1%. It is followed by target costing with 19.5% application
rate and activity-based cosing has the lowest rate of being applied (6.2%). Compared
to other countries provided by research of Chenhall and Langfield-Smith (1998), Joshi
(2001), Abdel-Kader (2006), the application rate of these cost accounting methods in
Vietnam Northern companies is relatively low.
Taken business type into account, multi-industry and service companies possess
the highest frequency rate of applying variable cost with 40% and 42,3% respectively.
Manufacturing firms rank third with 3,2% while construction companies have the
lowest rate being 21,3%. The application rate of remaining companies is lower than all
companies’ average rate.
Construction and service companies’ application rate of target costing is
higher than the average rate being 24,7% and 26,9% respectively. Remaining firms
in other sectors have the rate being lower than the average.

4.1. Characteristics of Vietnamese companies and description of the research
sample

4.1.1. Some characteristics of Vietnamese firms and Northern Vietnam companies.
Majority of Vietnamese firms and Northern Vietnam companies are small-tomedium sized (with the number of employees being less than 200). Companies with
more than 200 employees only take up roughly 2%. Most of the surveyed firms are in
the commerce and service sector (29,53%). Companies in the manuafacturing and
processing sector account for 27.85% and the remaining are active in different
industries with their share standing at approximately 3%.
Million billion, statistical yearbook. Out of all active firms in Vietnam, the total
quantity of active Northern Vietnam companies is 236.580 making up 46.7% of the
market share. These firms employ 7 million people which constitute 49,3% of the total
of 14 million employees working in companies nationwide. The total amount of capital
of Northern Vietnam firms is more than 10 million billion VND accounting for 39,6%
of all companies’ capital in the country (which is more than 26 million billion VND).
In addition, Northern Vietnam companies achieve the net revenue being more than 17
million billion VND (Statistical Yearbook, 2017).
4.1.2. Description of the research sample

Business

Number of
employees

Characteristics
Service
Multi-industry
Manufacturing
Commerce
Construction
Total
Below 100
From 100 to 300

From 301 to 500
From 501 to 1000
More than 1000
Total

Quantity
26
60
76
97
178
437
252
90
39
28
28
437

Percentage
5,9
13,7
17,4
22,2
40,7
100,0
57,7
20,6
8,9
6,4

6,4
100,0


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Companies infrequently apply the activity-based costing. Except for service
firms with the application rate being 15,4%, companies in the remaining sectors allo
have the rate below 10%. Notably, there was no record of commerce companies
applying this method.
Overall, the frequency of surveyed firms using variable costing is comparatively
low. Only service companies achieve the average point of 3,4 while companies in
other industries were recorded the average point of below 3.
4.2.2. Status of the application of estimates
Findings showed that estimate rate reached more than 46.1% in construction firms
with production cost estimate having the highest rate (100,0%) and financial statement
estimate possessing the lowest rate (46,1%). The rates for consumption estimate, material
cost estimate and capital estimate were 52,8%; 65,2% amd 57,3% respectively.
Manufaturing companies ranked the second regarding the application rate of
estimate. Material cost estimate had the highest rate of being used with 52,6% while
financial statement estimate places last with 43,4%. Production cost estimate,
consumption estimate and capital estimate had the application rate being 51,3%; 44,7%
and 51,3% respectively.
Multi-industry firms finished the third in terms of the rate using estimate. In
these companies, material cost estimate was applied most frequently with the rate
achieving 58,3% while financial statement estimate had the lowest rate of 31.7%.
Consumption rate reached 53.3%. Both production cost estimate and capital estimate
possessed the rate of 41,7%.

Service companies used capital estimate most frequently with the rate being 65.4%
while production cost estimate has the lowest application rate of 15.4%. Other estimate
all possessed the rate below 40% (38,5% for consumption estimate, 46,2% for purchase
estimate and 42,3% for financial statement estimate).
The application rate of estimates was relatively low in commerce firms.
Production cost estimate was used with the lowest rate of 6,2%. Other estimates including
financial statement estimate, capital estimate, for consumption estimate and purchase
estimate had the application rate being 38,1%; 48.5%, 45,4% and 46,4% respectively.
The average point regarding the frequency using estimates among survey
companies ranged from 3,12 to 3,44. Purchase estimate was applied most frequently
with the average of 3,44 while financial statement estimate ranked the last with the
average of 3,12.
In terms of business types, construction firms had the highest application rate of
estomates. The average point for companies in this sector ranged from 3,35 to 4,37.
Commerce firms had the average point below the average value. In addition to the
production cost estimate rarely being use, other estimates’ mean ranged around the 3
pint value (2,78 to 3,09).
4.2.3. The application of indicators for activities’ evaluation

In addition to net profit indicator used by most companies, sale growth rate
indicator had the application rate being more than 50%. The revenue per employee
indicator had lowest rate of being used (7,2% for commerce companies and 25% for
manufacturing firms). Other indicators had the application rate below 40%.
In addition to using net profit indicator frequently, surveyed companies applyed
financial indicators to assess activities at a average rate (above 3,0). The revenue per
employee indicator had the lowest applicaton rate of 2,6%. The rate of using indicators in
commerce companies was lower than the average rate of surveyed firms in general.
Surveyed companies infrequently used non-financial indicators to evaluate
activities. Customer satisfaction indicator was applied with the highest rate of 46,2%
in service firms. Delivery-on-time indicator and time length for

construction/production indicator were used with the rate of 45,0% and 41% in multiindustry companies and construction firms respectively. The remaining indicators has
the application rate below 40%.
The frequency rate of using non-financial indicators was also relatively low with
their mean being roughly 3,0.
4.2.4. The application of information analysis techniques for decision-making.
Regarding the usage of information analysis techniques to make short-term
decisions, CVP analysis and profit analysis had the highest application rate of more
than 53% while other techniques had the application rate ranging from 20 to 50%.
Corresponding to the application rate, the degree of using CVP analysis and profit
analysis reached above the mean (3,4) while other techniques were around 3,0.
In terms of the usage of information analysis techniques to make long-term
decisions, internal rate of return (IRR) was the most popular technique in commerce
companies (88,7%) and it was payback period for construction firms (51,7%). Other
techniques had the application rate being lower than 50%.
4.2.5. The application of Strategic Management Accounting (SMC)
Target costing was applied most frequently with the rate of 24,7% in
construction firms. Balanced scorecard was not used by any of surveyed companies.
Other techniques had the application rate being below 20%. The low application
rate led to the low mean of using strategic management accounting in surveyed
firms. In addition to target costing reaching a mean of 3,2, other techniques had a
mean of below 3,0.
4.3. Factors affecting the application of management accounting
There are five factors influencing the application of management accounting
consisting of (1) Competition, (2) Decentralization in the company, (3) the application
of information technology, (4) Managers’ concerns with management accounting and
(5) accountants’ qualifications.
Results of hypotheses approved and disproved via Spearman coefficient testing
and linear regression are demonstrated in Table 5.1 as below:

13

No

1

2

3

4

5

6

7

8

Table 5.1. Approved and disproved positive hypotheses
Dependent Independent
Hypotheses
Variables
Variables
Group 1
Competition
Hypothesis
H1-1:
Positive

correlation
between
Market
Competition and the application
rate of techniques to support the
decision-making process exists.
Hypothesis
H1-2:
Positive
The degree of
correlation between the degree of
decentralization
decentralization in the company
and the application rate of
techniques to support the decisionmaking process exists.
Positive Techniques Status quo of
Hypothesis
H1-3:
correlation between the application to support
the application
of information technology and the the
of information
application rate of techniques to decisiontechnology
support
the
decision-making making
process exists.
process
Positive
Managers’

Hypothesis
H1-4:
correlation between managers’
concerns
concerns
with
management
accounting and the application rate
of techniques to support the
decision-making process exists.
Hypothesis
H1-5:
Positive
Accountants’
correlation between accountants’
qualifications
qualifications and the application
rate of techniques to support the
decision-making process exists.
Group 2
Hypothesis
H1-6:
Positive
Competition
correlation
between
Market
Competition and the application
rate of indicators to assess
activities exists.

Indicators to
Hypothesis
H1-7:
Positive
Decentralizatio
assess
correlation between the degree of
n
activities
decentralization in the company
and the application rate of
indicators to assess activities exists.
Hypothesis
H1-8:
Positive
Status quo of
correlation between the application
information

14

No
Results
Approved

9
Approved

10
Approved

11
Disproved
12

Approved

13

14
Approved

15
Approved

Approved

16

Hypotheses
of information technology and the
application rate of indicators to
assess activities exists.
Hypothesis
H1-9:
Positive
correlation between managers’
concerns
with
management

accounting and the application rate
of indicators to assess activities
exists.
Hypothesis
H1-10:
Positive
correlation between accountants’
qualifications and the application
rate of indicators to assess
activities exists.
Group 3:
Hypothesis
H1-11:
Positive
correlation
between
Market
competition and the application
rate of estimates exists.
Hypothesis
H1-12:
Positive
correlation
between
decentralization in the company
and the application rate of
estimates exists.
Positive
Hypothesis
H1-13:

correlation between the application
of information technology and the
application rate of estimates exists.
Hypothesis
H1-14:
Positive
correlation between managers’
concerns
with
management
accounting and the application rate
of estimates exists.
Hypothesis
H1-15:
Positive
correlation between managers’
concerns
with
accountants’
qualifications and the application
rate of estimates exists.
Group 4
Positive
Hypothesis
H1-16:
correlation
between
Market
competition and the application
rate of SMC techniques exists.

Dependent
Variables

Independent
Variables
technology

Results

Managers’
concerns

Approved

Accountants’
qualifications

Approved

Competition

Approved

The degree of
Approved
decentralization
in the company

Estimates

The application Approved
of information
technology
Managers’
concerns

Disproved

Accountants’
qualifications

Approved

Strategic
Competition
Managemen
t
Acoounting

Approved


15

No

17

18

19

20

21

22

23

24

25

Dependent Independent
Variables
Variables
Hypothesis
H1-17:
Positive (SMC)
The degree of
correlation between the degree of techniques
decentralization
in the company
decentralization in the company
and the application rate of SMC
techniques exists.
Hypothesis
H1-18:

Positive
The application
correlation between the application
of information
technology
of information technology and the
application rate of SMC techniques
exists.
Positive
Managers’
Hypothesis
H1-19:
correlation between managers’
concerns
concerns
with
management
accounting and the application rate
of SMC techniques exists.
Positive
Accountants’
Hypothesis
H1-20:
correlation between accountants’
qualifications
qualifications and the application
rate of SMC techniques exists.
Group 5
Hypothesis
H1-21:

Positive
Competition
correlation
between
Market
competition and the application
rate of techniques to support the
production exists.
Positive
The degree of
Hypothesis
H1-22:
correlation between the degree of
decentralization
decentralization in the company
in the company
and the application rate of
techniques
to
support
the
Techniques
production exists.
to support
Hypothesis
H1-23:
Positive
Status quo of
the
correlation between the application

the application
production
of information
of information technology and the
technology
application rate of techniques to
support the production exists.
Positive
Managers’
Hypothesis
H1-24:
correlation between managers’
concerns
concerns
with
management
accounting and the application rate
of techniques to support the
production exists.
Hypothesis
H1-25:
Positive
Accountants’
Hypotheses

16

Results

No

Chấp nhận
Approved

Hypotheses
correlation between accountants’
qualifications and the application
rate of techniques to support the
production exists.

Dependent
Variables

Independent
Variables
qualifications

Results

Source: Author’s own findings and analysis
Approved

Approved

Corresponding to positive disproved hypotheses, these following negative
hypothese are approved:

No

1

Approved

Approved

Approved

2

3

4
Approved

Disproved

Disproved

Table 5.2. Negative hypotheses being approved:
Dependent Independent
Results
Hypotheses
variables
variables
Hypothesis H0-4: Positive correlation
between managers’ concerns with Techniques
management accounting and the to support Managers’
Disproved
the
concerns
application rate of techniques to

support the decision-making process production
does not exist.
Hypothesis
H0-24:
Positive
correlation between
managers’
Managers’
Disproved
concerns
with
management Estimates
concerns
accounting and the application rate
of estimates does not exist.
Hypothesis
H0-24:
Positive
correlation between
managers’
Managers’
concerns
with
management
Disproved
concerns
accounting and the techniques used
Techniques
in production does not exist.
used in

Hypothesis
H0-25:
Positive
production
correlation between
managers’
Accountants’
Disproved
concerns
with
management
qualifications
accounting
and
accountants’
qualifications does not exist.
Source: Author’s own findings and analysis

Via negative hypotheses being approved, there are conclusions regarding the
correlation betwwn independent variables and dependent variables presented as below:
Conclusion 1: There was no evidence for the existence of positive correlation
between managers’ concerns with management accounting and the application of
information analysis techniques to support the decision-making process (Break-even
analysis, payback period, net present value, CVP analysis, internal rate of return,
products’ profit analysis, customers’ profit analysis, providers’ cost analysis).


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18

Conclusion 2: There was no evidence of a positive relationship between the
interest of the administrators in the management accounting with the level of using
some types of estimates in enterprises (consumption estimates, purchase estimates,
money estimates and financial statements estimates.
Conclusion 3: There was no evidence of a positive relationship between
administrator's interest in the management accounting and the qualifications of
accountants to the status of applying the techniques and targets to support production
(production estimates, production time, and product failure rate).
Results of hypothesis testing, independent variables: Competitive pressure,
degree of decentralization, status of IT application, managers' interest in management
accounting and professional qualifications of accountants all affected the application of
management accounting techniques in enterprises in North of Vietnam on statistically
significant basis. Acceptable hypotheses are as follows:

No

Table 5.3: Hypotheses about the impact of factors on the application of
management accounting techniques in North Vietnamese enterprises
No
Hypotheses
Result
1 H1-1: There exists a positive correlation between competitive Accepted
pressure in the market and the level of using decision-making
support techniques.
2 H1-2: There exists a positive correlation between the degree of Accepted
decentralization in enterprises and the level of using decisionmaking support techniques.
3 H1-3: There exists a positive correlation between the status of Accepted
applying IT in enterprises and the level of using decision-making
support techniques.

4 H1-5: There exists a positive correlation between the Accepted
qualifications of accountants and the level of using decisionmaking support techniques.
5 H1-6: There exists a positive correlation between competitive Accepted
pressure in the market and the level of using performance
evaluations indicators.
6 H1-7: There exists a positive correlation between the degree of Accepted
decentralization in enterprises with the level of using the
performance evaluation indicators.
H1-8: There exists a positive correlation between the status of Accepted
applying IT in enterprises with the level of using the performance
evaluation indicators
7 H1-9: There exists a positive correlation between administrators' Accepted
interest to management accounting with the level of using
performance evaluation indicators.
8 H1-10: There exists a positive correlation between the professional Accepted
qualifications of accountants and the level of using the

14

9
10

11

12

13

15

16

17

18

19

20

Hypotheses
performance evaluation indicators.
H1-11: There exists a positive correlation between competitive
pressure in the market and the level of use of estimation types.
H1-12: There exists a positive correlation between the degree of
decentralization in enterprises with the level of using estimation
types.
H1-13: There exists a positive correlation between the status of
applying IT in enterprises with the level of using estimation
types.
H1-15: There exists a positive correlation between the professional
qualifications of accountants and the level of using of estimation
types
H1-16: There exists a positive correlation between competitive
pressure in the market and the level of using strategic
management accounting techniques.
H1-17: There exists a positive correlation between the degree of
decentralization in enterprises and strategic management
accounting techniques
H1-18: There exists a positive correlation between the status of

applying IT in enterprises and strategic management accounting
techniques
H1-19: There exists a positive correlation between the interest of
administrators in management accounting with strategic
management accounting techniques.
H1-20: There exists a positive correlation between the professional
qualifications of accountants and strategic management
accounting techniques
H1-21: There exists a positive correlation between competitive
pressure in the market and the level of using some production
support techniques.
H1-22: There exists a positive correlation between the degree of
decentralization in enterprises and the techniques to support
production.
H1-23: There exists a positive correlation between the status of
applying IT in enterprises and the techniques to support
production.

Result
Accepted
Accepted

Accepted

Accepted

Accepted

Accepted

Accepted

Accepted

Accepted

Accepted

Accepted

Accepted

Conclusion 4: The effect of independent variables on dependent variables is
shown in Table 5.4. as follows:


No

1

2

3

4

5

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20

Table 5.4. Summary of the effects of independent variables on dependent
variables

Competitive pressure had the strongest impact on the use of performance
indicators. Competitive pressure requires businesses to effectively use resources and
assess the performance of managers and departments. Therefore, it was reasonable to
increase the use of performance estimate indicators to provide administrators with
information on the performance of departments and managers.
The degree of decentralization in the business was associated with giving
decisions to inferior managers and evaluating them through performance evaluation
criteria. Analysis results described that the impact of increased decentralization level
on the application of decision-making support techniques was the strongest. The level
of decentralization increased by 1 point, making the application of decision support
techniques increase by 0.864 points. This is the strongest impact of the independent
variables on the dependent variables.
The application of IT had a compelling impact on the application of some types
of estimates. Because estimation requires a lot of calculations, the application of IT has
supported a lot of accountants in the calculation and estimation work.
The interest of manager in management accounting had an influence on the
application of management accounting techniques but still uncountable. In addition to
an insignificant impact on the application of strategic management accounting
strategies and operational evaluates indicators, this dependent variation did not affect
the application of other management accounting techniques.
Finally, the professional qualifications of accountants had the strongest impact
on the application of strategic management accounting. Management accounting
techniques has been developed in recent years. Currently, there is still no agreement on
the definitions and names of these techniques. Accordingly, the application of these
techniques requires understanding knowledge, application conditions as well as costs

and general benefits. Therefore, in order to apply strategic management accounting
techniques, it is required that accountants must be mastery in these techniques.

Independent
variables

Dependent variables

Decision support techniques
Performance evaluation
indicators
Competitve
Some types of estimates
pressure
Strategic Management
Accounting
Techniques to support production
Decision support techniques
Performance evaluation
indicators
The degree of
Some types of estimates
decentralization
Strategic Management
Accounting
Techniques to support production
Decision support techniques
Performance evaluation
indicators
IT application

Some types of estimates
status
Strategic Management
Accounting
Techniques to support production
Decision support techniques
The interest of Performance evaluation
indicators
the
administrator to Some types of estimates
management
Strategic Management
accounting
Accounting
Techniques to support production
Decision support techniques
Performance evaluation
indicators
Professional
qualifications
Some types of estimates
of accountants Strategic Management
Accounting
Techniques to support production

Standardized Order of
beta
influence
coefficient
2

0,303
1
0,824
3
0,270
5
0,190
0,263
4
0,864
1
2
0,370
0,234
4
3
0,359
0,224
5
0,220
5
3
0,274
0,860
1
2
0,351
0,231
4
2

0,045
1
0,084
0,189
2
4
0,105
0,183
3
1
0,734
-

Source: Summary of the author's analysis results
Research results in Table 5.4 indicated that:

CHAPTER 5
CONCLUSION AND RECOMMENDATIONS
5.1. Conclusion about research findings
5.1.1. Current situation of applying management accounting techniques in
enterprises in Northern Vietnam
Based on the results of empirical research, the thesis made conclusions about the
current situation of low-level applying management accounting in enterprises in the
North. It also pointed out the causes of the short of techniques and management
accounting methods application in enterprises, specifically:
Firstly, managers in enterprises in Northern Vietnam are not aware of the
significant role of applying management accounting techniques in improving asset
efficiency and creating a competitive position for businesses. Therefore, the

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22

mechanism of diffusion and simulation has not been effective. Enterprises which are
not interested in applying management accounting, have not paid attention to research
and learn to apply management accounting techniques in businesses in order to
improve the efficiency of economic resource usage and business efficiency.
Secondly, when the mechanism of diffusion and simulation does not work, it is
necessary to push an impact to enforce it. However, in Vietnam, enterprises are not
required to apply management accounting techniques. In addition, due to limited
awareness and knowledge of management accounting techniques as well as their
effects, some people are not only afraid to change but also intend to prevent this
application to protect the stabilization of the system. This phenomenon is explained by
an institutional theory called “system power".
Thirdly, managers in enterprises in Northern Vietnam often use less information
provided by accountants to make decisions on business management. The executive
and decision-making activities of the managers are mainly based on experience. The
administrators do not expertise in management accounting, so they do not know that
management accounting also has roles and effects in the decision-making process.
Fourthly, the degree of decentralization in enterprises in Northern Vietnam is
also limited, affecting the application of management accounting techniques. This
happens to companies which have not been decentralized, such as assigned
responsibility to the department managers or evaluated the operational efficiency
through the operational evaluations indicators. They do not have any demand for this
information to be planned, controlled and evaluated for the effectiveness. The
activities of enterprises still mainly focus on the overall profit target.
Fifthly, IT support makes the application of management accounting techniques
more convenient. Therefore, if the IT provision for management and accounting is still
limited, it may affect the application of management accounting techniques in

enterprises.
Sixthly, complete understanding and proficient usage of management
accounting techniques of accountants also affects the application status in an
enterprise. An insufficent understanding of management accounting techniques leading
to a situation that the information provided by accountants does not meet the
information needs for managers in the decision-making process. This restriction has
once again affected the role of management accounting in enterprises.
Finally, cost is also one of the reasons that affect the application of management
accounting techniques in enterprises. Management accounting techniques are only
applied by enterprises if the benefits from these techniques greater than the cost of
applying them. Some complex management accounting techniques require changing
operating habits, changing the organizational structure as long as their expensive price.
This leads to the problem that these techniques will be less popular and poorly applied
in enterprises.

5.1.2. Influence of factors on the application of Management Accounting in
enterprises in Northern Vietnam
Through correlation and regression analysis, the thesis makes conclusions about
the impact of some random factors on the application of management accounting
techniques in enterprises in Northern Vietnam. Management decentralization in
enterprises is the most influential factor as well as the most extensive to the application
of management accounting techniques in enterprises. Professional qualifications of
accountants are also factors that strongly influence the application of management
accounting techniques. The highest IT factors and interest of managers, although not
as powerful as the other two factors mentioned above, are also important conditions
and premises for the development of management accounting in enterprises.
5.2. Some recommendations and solutions
5.2.1. Recommendations
According to the research results and analysis of the reasons for the low
application of management accounting techniques in enterprises in Northern Vietnam,

the author proposes the following recommendations:
First, businesses need to strengthen decentralization in enterprises for managers.
Decentralization is often tied to the responsibilities of managers so it raises the need
for information to effectively use resources as well as use assessment factors to
encourage employees to operate effectively.
Secondly, enterprises need to enhance the application of IT to automate the
stages in the process of data collection and processing, facilitating the application of
advanced management accounting techniques.
Thirdly, the highest managers in enterprises need to care, support and facilitate
more for the management accounting techniques to be deployed and applied in
enterprises Fourthly, accounting qualifications must be improved. Modern
management accounting knowledge updating is a necessary condition which can be
applied in businesses for management accounting techniques in general and modern
management accounting techniques in particular.
Fifthly, enterprises need to be aware of increasing competition pressure to
strengthen decentralization as well as enhance interest in management accounting.
Increasing investment in IT, improving professional qualifications for accountants and
raising committment to support accountants to apply management accounting
techniques and methods would help businesses meet the required information to
enhance the competitive position themselves.
5.2.2. Solutions to enhance the application of management accounting techniques in
Vietnamese enterprises
Firstly, organizations supporting enterprises (Development support funds for
businesses, Vietnam Chamber of Commerce and Industry, Business clubs ...), and
accounting professional associations need to reinforce training courses in order to


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24

foster knowledge for business administrators and accountants in enterprises
Accordingly, they should recognize the benefits of applying management accounting
techniques and be ready to research and apply them in the process of planning,
controlling and evaluating efficiency and decision making.
Secondly, the government and organizations should support enterprises in
organizing training courses, propagating the advantages of management accounting
techniques to improve decision-making efficiency, business efficiency and
competitiveness capacity.
Thirdly, the government and organizations should support enterprises to build
up and implement projects helping them to apply advanced management methods and
management accounting techniques.
Fourthly, accounting training institutions and professional accounting
organizations need to actively propagate the management accounting techniques and
guide learners to apply these techniques to real situations of enterprises. Instead of
teaching how to write accounting books, training programs need to focus on
converting knowledge and skills so that learners can successfully apply the
management accounting techniques. They will be informed about how to collect,
process and provide information for decision making progress, and how to design
short-term and long-term evaluation indicators in the enterprises, etc.
Fifthly, instead of focusing on making financial statements and dealing with taxrelated issues, accountants need to actively study and improve management accounting
to be able to understand and apply successfully. They should adopt the techniques in
collecting, processing and providing information to managers in the decision-making
process, participating in governance processes and contributing to creating added value
for enterprises.
5.3. Restrictions and recommendations for follow-up research
5.3.1. Limitations of the study
Data collected was in a convenient method; the date could not be gathered
according to the stratified random method. The collected data mainly concentrated in
Hanoi, not yet dispersed evenly in the southern regions of Vietnam.

Respondents might not understand all the questions or answer them incorrectly.
There were difficulties in data collection as well as access to previous research
works; therefore, incomplete documents collection also, by some means, limited the
research results.
5.3.2. Suggestions for further studies
The effect of factors on the management accounting system in enterprises need
further, and more sufficient study in order to provide managers and enterprises with
the status of management accounting application as well as the evidence of impact
level of these factors. Further studies should:

- Expand the number of independent variables to fully evaluate the impact of
factors on the application of management accounting status.
- Use a combination of qualitative and quantitative research methods to fully
and deeply access the status of factor’s impact on the application of management
accounting.
- Apply the stratified random sampling method to ensure data reliability.
CONCLUSION
In the current competitive and integration environment, management accounting
is increasingly becoming an important tool to support businesses to operate effectively.
Management accounting is a specialized area of accounting to grasp the current
situation, especially the financial situation of enterprises. Thereby, it helps the
enterprise managers to make the best administration decisions. Information of
Management accounting is particularly important in business operation while control
and evaluate that company. Therefore, the management accounting application will
help Vietnamese enterprises to improve their operational effectiveness.
The purpose of conducting this research is to appraise the application status of
management accounting in enterprises in Northern Vietnam today and assess the
impact of these factors on management accounting the application. Based on the
survey results and quantitative research results, this study demonstrated that the
situation of management accounting application in Northern Vietnam enterprises was

still relatively underrated; many enterprises were not interested in management
accounting development. Traditional management accounting techniques were mainly
applied while modern ones were still rarely adopted. Research results also showed that
decentralization, application of IT and professional qualifications of accountants were
factors that affected the application of management accounting techniques in
enterprises.
Based on the research results, the author made some recommendations for
enterprises to enhance the application of management accounting. At the same time,
due to the limitations of research, there were some directions for further research.