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Cost Accounting in Anglophone Subsidiaries

Empirical Evidence from Germany


Moritz Schröder

Cost accounting in Anglophone countries is in general less detailed than German cost accounting. Such cross-national differences imply a tension for Anglophone multinationals operating in Germany. These firms have to balance the group-wide application of their home-country traditions and the approval of diverging local cost accounting systems. By the means of a dyadic research design, this study finds empirical evidence for Anglophone cost accounting traditions to prevail in subsidiaries of Anglophone multinationals in Germany. However, the top management teams in these subsidiaries tend to work around such coercive pressures. The findings also suggest that the subsidiaries prefer to deviate from their parent companies’ traditions to ensure the usefulness of information for their cost accounting systems.
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1 Introduction


1.1 Motivation and research questions

“Comparative management research consistently reports that organizations within one national setting can exhibit similarities not shared by enterprises in other countries.”1

Despite tendencies towards international convergence,2 there are remarkable national particularities of management accounting practices.3 This holds especially true for cost accounting,4 the source of modern management accounting.5 Since the establishment of cost accounting during the industrialisation in the 19th century,6 its development is especially attributable to German-speaking and Anglophone researchers and practitioners.7 Hence, it is not surprising that German and Anglophone8 cost accounting is characterised by unmistakable particularities. Whereas German cost accounting is particularly sophisticated and refined, Anglophone cost accounting traditions tend to be considerably less detailed.9

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