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Students.
This study will provide students knowledge on the extent of the practice of management
accounting tools in the actual corporate world. At the end of the study, accounting students, who
are management accountants in the making, would know the degree of significance and
relationship of the management accounting practices with the companies’ financial performance.
Future researchers
This study will be a useful reference for the researchers who would plan to make any related
Strategic analysis
Strategic Analysis. The business environment has become intensively dynamic and
become more demanding. To achieve competitiveness, companies apply different strategies and
management accounting should be used as one of the main supporting system for strategy
implementation. For this purpose, strategic management accounting and strategic cost
strategic management accounting when he introduced the concept in 1981 (Ramljak and
Rogošić, 2012).
management accounting is the provision and analysis of management accounting data about a
business and its competitors for use in developing and maintaining the business strategy. It
focuses on the relative levels and trends in real costs and prices, volume, market share, cash flow
and the proportion demanded of a firm’s total resources. The study of Gatandi (2012) has
investigated whether strategic management accounting techniques are associated with
improvement in financial performance in the service sector or not. In the case of strategic
management accounting techniques as initiatives that can assist in achieving improved financial
performance.
Conceptual framework
The conceptual framework depicts the relationship between independent variable and the
dependent variable. The independent variables are the management accounting practices
including Costing, Budgeting, Performance Evaluation, Information for Decision Making and
Strategic Analysis. The dependent variables includes the financial performance of the
companies which are determined by computing the financial ratios derived from their financial
statements.
The succeeding diagram graphically shows the hypotheses to be tested. Each hypothesis
Figure 1 shows the five hypotheses to be tested in this study. H0-1 would test the
relationship between the Costing System and the financial performance measures. H0-2 would
test the relationship between the Budgeting and the financial performance measures. H0-3 would
test the relationship between the Performance Evaluation and the financial performance
measures. H0-4 would test the relationship between the Information for Decision Making and the
financial performance measures. H0-5 would test the relationship between the Strategic Analysis
and the financial performance measures. In order to determine the relationship between the
management accounting practices and the financial performance, researchers will employ the
TABLE 6
Table 6.
System and ROE, rs = .736. Also, strong positive correlation exists between use of Costing
System and ROA and NPR, both resulting to a rs = .706. Furthermore, there is still strong
positive correlation exists between the use of Costing System and GPR and OPM having rs =
.618. Strong positive correlation exists between the use of Budgeting and the profitability
measures ROA, GPR, and OPM, all having the value rs = .771. Moreover, strong positive
correlation exists between the use of Budgeting and ROE and NPR having, rs = .714 and, rs =
.657 respectively. In addition, strong correlation exists between the use of Performance
Evaluation and GPR and OPM, both resulting to values of rs = .794. Also, strong positive
correlation exists between the use of Performance Evaluation and ROA and NPR, both resulting
to values of rs = .706. While moderate positive correlation exist between the use of Performance
Evaluation and ROE, having the value rs = .441.Strong positive correlation exists between the
use of Information for Decision Making and the profitability measures GPR and OPM, both
having the value rs = .696. Moderate positive correlation exists between the use of Information
for Decision Making and ROA and ROE and NPR, having the value rs = .551, rs = .464, rs =
.435, respectively. Lastly, strong positive correlation exists between the use of Strategic Analysis
and the measure ROE, having the value rs = .771. Moreover, strong positive correlation exists
between the use of Strategic Analysis and ROA, GPR and OPM, all having the value rs = .657.
Additionally, strong positive correlation exists between the use of Strategic Analysis and NPR,
However, none of the correlation coefficients were found significant at 0.05 level.
Decision making
Information for Decision Making. Spearman Rank- Order Correlation showed that there
is no significant relationship between the extent of use of information for decision making in the
overall financial performance. This is in contrast with the study of Matambele (2014) which
states that the decision-makers are strongly encouraged to make use of reports generated by
management accountants to assist them in making appropriate and informed decisions that will
benefit the organization. The study indicated that decisions to utilize information from
Management Accounting tools lie with the decision-makers in these organizations. In addition,
information for decision making practices was established as having the greatest impact on
Smith (2003) found that firms with a greater reliance on non-financial accounting information
improved their performance. These findings support the suggestion that changes in MAS are
Information for Decision Making and Performance Measure. Information for decision
making resulted to varying negative weak to positive strong relationship with the overall
financial measures of the company. However, these results indicated insignificant correlation
between Information for decision making with profitability, liquidity, solvency and activity. The
researchers believed that these above-mentioned measures are mostly affected by other factors