Accounting for Management Control in Large Libyan Companies

Adel R Haedr, Messaoud Mehafdi

Research output: Contribution to journalArticle

Abstract

The study gives an account of management control practices in Libya during a period of relative political and economic stability that preceded the 2011 war and regime change. Using a two-level contingency model and survey data, stepped mediation regression first ascertains contingency relationships between organisational variables and management control system (MCS)effectiveness. We also explicitly focus on the mediating role of management accounting information (MAI) in MCS effectiveness. We find that centralisation, formalisation, environmental uncertainty and competitive strategy significantly influence MCS effectiveness. Full mediation is observed in relation to centralisation, whereas partial mediation is detected for formalisation, environmental uncertainty, and competitive strategy. Manufacturing process complexity is not present in first level relationships and further tests only yielded an indirect MAI effect, not mediation in this case. The full vs. partial mediation distinction is not evident in most previous MCS interaction research, nor is the isolation of the indirect effect, and future research needs to explore this with larger samples. This is possibly the first study to develop and apply a multi-level contingency model that explicitly focuses on the mediating role of MAI to empirically examine MCS effectiveness and contributes to the nascent literature on management accounting in emerging economies.
LanguageEnglish
Pages279-303
Number of pages25
JournalAthens Journal of Business & Economics
Volume3
Issue number3
Publication statusPublished - 1 Jul 2017

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Management control
Management control systems
Mediation
Large companies
Management accounting
Accounting information
Environmental uncertainty
Centralization
Competitive strategy
Formalization
Contingency model
Survey data
Isolation
Regime change
Information effects
Organizational variables
Manufacturing process
Indirect effects
Contingency
Emerging economies

Cite this

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Accounting for Management Control in Large Libyan Companies. / Haedr, Adel R; Mehafdi, Messaoud.

In: Athens Journal of Business & Economics, Vol. 3, No. 3, 01.07.2017, p. 279-303.

Research output: Contribution to journalArticle

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