ABSTRACT
Mergers have become part of the business landscape and a popular strategic choice for companies’ growth and expansion. To Jemison and Sitkin (1986b, p. 107), “the use of acquisitions to redirect and reshape corporate strategy has never been greater”. Yet despite the popularity and strategic importance of M&A, several major consulting, advisory services firms and academics have reported that, most acquisitions are financial failure in the long-term (KPMG, 1999; Mergerstat, 2000; PricewaterhouseCoopers, 2000; Henry, 2002). The issue of M&A’s performance is central to research in M&A studies. Both academic research and anecdotal evidence indicate that one of the reasons attributed to M&A’s failure to create value for shareholders is lack of effective and successful integration of the two companies. Researchers have addressed the issue of post-acquisition integration process from human resources, cultural and corporate points of view (see Haspeslagh and Jemison, 1991; Birkinshaw et al., 2000). In the context of accounting, we know very little about what accountants do when two companies are merged and the process involved in finance and accounting system integration. We believe that the ability to recognize the importance of the acquisition integration process itself is a key to a successful integration. This is consistent with the views of Jemison and Sitkin (1986b), who suggested that the lack of careful research attention on the issues of post acquisition integration appears to reflect the difficulty of recognizing the process itself as part of the problem and solution. To fully understand how M&A create value, it is important to study not only the actions that led up to the acquisition decision but also the integration of management activities that follow the decision (Jemison and Sitkin, 1986a). We contribute to this direction by examining the actions that are taken to manage the task involved in accounting integration which are a key to successful performance. This study attempts to examine and develop management accounting task performance model prior to, during and after the M&A of the two companies involved and the factors influencing the integration process. The main purpose of this chapter is to examine and map out the task performance of management accountants in the integration process of accounting system (FAS) in mergers and acquisitions.
