ABSTRACT
This chapter deals with the emergence of Activity Based Costing as a major driver for change in accounting research and practice, and its application in the financial services sector. It introduces earlier studies, undertaken in the financial services sector in Europe, which have focused on the relation between management accounting systems (MAS) and organizational change. The chapter presents a framework by G. Morgan and A. Sturdy, a longitudinal case study of organizational change, where an activity based costing system has been trialed for implementation, as a means to improving the economy, efficiency and effectiveness of employee activity. The value-added contribution of this research is that it highlights the increase in visibility and perceived importance of accounting in the banking sector, and how accounting is significant beyond its technical roles. The failure to adapt conventional MAS to changes in the new competitive environment was seen as an important reason for the competitive decline of Western industry.
