Research On Management Accounting Reporting System For Manufactural Enterprises Based On Value Chain Theory

Since the21st century, with the continuous development of science and technology and the deeper development of economic globalization, the competition among enterprises is becoming fiercer. Confronted with the complex and ever-changing economic environment, whether the managers can make the right business decisions timely and effectively become the key to the success of the enterprise. Right decisions depend on the relevance, timely and reliable of the information. Accounting as an information system, providing decision-useful accounting information is Accounting’s chief function and eternal theme.With the development of securities market, the public financial reports began to come into public sight, attract the universal academic attention and be widely used in commerce. While the study on the theoretical value of the management accounting reports is in the ascendant, and its application value has not been realized. Management accounting reports have not be attached due importance as financial reports, many companies neglect management accounting reports, and get the management information through the analysis of financial reports. But be affected by the shareholders, creditors and accounting standards establishing and actualizing organization, the relevance and timeliness of the external reporting information is limited and can not meet the information needs of the decision-makers, make it difficult for them to make fast and accurate decisions. Therefore, it is necessary to consider the needs of internal management, prepare a set of management accounting reports to improve managers’decision-making ability.Management accounting and business practices are closely linked, only a comprehensive understanding of the operation and management of enterprises, and a well known of management accounting information needs of the managers can prepare management accounting reports which is highly decision-making related. To this end. on the basis of reading related literature about management accounting reports, I entered the case enterprise to conduct field research, carried out the questionnaires, had semi-structured interviews with the senior staff, combined with internal data, to build Triangle evidence chain, to learns the needs of the management accounting information and application status of the management accounting reports from multi-angle. During the research, I found that management accounting reports had been maturely used in case enterprise, but results of the application were not satisfactory. Lack of dynamic and timeliness, existing management accounting reports can’t make adjustments according to the changing environment. Be constrained by the functional organization, internal management accounting information flow could not be shared among the different departments, good synergy can not be formed, all of this will have a unfavorable effect on the competitiveness and value of the enterprise. Therefore, I tried to break the barriers of the information among departments, built horizontal management accounting reporting system, integrated management accounting information in each procedure, to improve the dynamic and timeliness of the management accounting reports and to better service for management decision-making. Value chain theory provides theoretical guidance for this conception.Value chain theory was first put forward by the Harvard Business School professor Michael E.Porter. A value chain is a chain of activities that a firm operating in a specific industry performs in order to deliver a valuable product or service for the market. The value chain provides customer value and at the same time achieves certain revenue and profit for the enterprise itself. In the next few decades, value chain theory attracts much attention in the world. Many of the world’s large enterprise use the value chain theory as a powerful tool to obtain the competitive advantage. On the basis of the value chain theory, value chain management has been developed. Value chain management coordinates and controls the logistics flow, capital flow, information flow on the value chain, in order to achieve efficient allocation of resources. The effective transmission of information is a crucial part of the value chain management. I introduce the value chain theory into management accounting reports, from horizontal process perspective, consider the relation of the value activities, put forward management accounting reporting system based on value chain theory, integrate the value chain information, promote coordination between the departments through the report information be transmitted effectively on the value chain, to provide decision support for managers in a complex and ever-changing dynamic environment.This article reviews and analyses the literature of management accounting reports, learn the historical and latest research about three themes of the management accounting report.those are budget report, cost analysis report, performance evaluation report, sum up the achievements and shortcomings of the existing research. After research topic is identified, I begin to choose case enterprise, write research outline, enter the case enterprise to conduct field research, carry out the questionnaires, and have semi-structured interviews with the senior staff, combine with internal data. Compare the information from three sources, sift the true from the false, form triangle evidence chain, make the different sources of information complete and confirm each other, to learn the needs of the management accounting information and application of the management accounting reports in the case enterprise. On the basis of in-depth analysis of the data, I introduce the idea of value chain, and build a management accounting reporting system based on the value chain for the case enterprise.This paper consists of seven chapters and the main contents are as follows:Chapter1, introduction. This paper introduces the research background and significance, points out the importance of the value chain theory and the management accounting reporting system, and briefly introduces research content, research methods.Chapter2, reviews on research of the management accounting reports. The three themes of management accounting reports, namely budget report, cost analysis report, performance evaluation report are reviewed, and point out the shortcomings of the existing management accounting reports. Try to build management accounting reporting system, use budget report for prior control, cost report for cost accounting and analysis during the process, performance evaluation report for evaluation in the end.Tracking and reflecting the business activities of the whole process.Chapter3. introduces the value chain theory, builds management accounting reporting system based on the value chain. Introduces the value chain theory, combines the theory with management accounting reports, to establish management accounting reporting system on the perspective of the value chain. Elaborates the intension and characteristics, objectives,functions, and framework of the management accounting reporting system based on the value chain.Chapter4, research design. Introduces the case study method, shows why use case study method, states the reasons to choose case enterprises and describes the research process. By carrying out the questionnaire survey, conducting semi-structured interviews with senior management, combining with internal data, to build Triangle evidence chain, reinforce the probative force of the evidence, increase the authenticity of data collected and lay the foundation for the case analysis of the next chapter.Chapter5, case studies. Analysis questionnaire data and interview information introduce the application of management accounting reports in case enterprise, summarize the shortcomings of the existing management accounting reports.Chapter6, the study conclusion. Analyses the competitive environment of the case enterprise, according to the importance of the activities on the value chain, selects research and development, purchase, production, sales the four links of the value chain as the critical value activities. Comprehends each link’s key point and needs for management accounting information. Integrates the value chain dynamic information,prepares the management accounting reports based on value chain for the case enterprise, service for operator’s decision-making, builds management accounting reporting system for manufactural industry based on the value chain.Chapter7, conclusion and outlook. Summarizes the conclusion of the article, introduces the innovation and shortcomings of the paper, and puts forward the future directions.The main contributions of this paper are as follows:The research content is innovative. Although many scholars have carried out extensive and in-depth research on budget reports, performance evaluation reports, management accounting reporting system is still in its infancy. This paper is based on the three themes of the management accounting reports, namely budget report, cost analysis report, performance evaluation report, combines with the practice of corporate management, builds management accounting reporting system which throughout the entire management process from the time dimension. Preparing the budget in advance, accounting and analyzing cost during the process of production and evaluating the performance in the end. It’s has formed a complete report cycle, to provide strong support for the managers’ decision-making, helps companies to achieve rational resource configuration and realize strategic goals.The research perspective is innovative. Management accounting reports service for the internal operating decisions, and the existing management accounting reports mainly use the historical data, can’t make dynamic adjustment according to changes of the internal and external environment, as the result the management accounting information lost the relevance of decision-making. The paper combines the value chain theory with management accounting reports, analyses the competitive environment of the enterprise, after understanding the internal and external environment, makes dynamic adjustment of management accounting reports for all the links on the value chain. Different from the traditional vertical management accounting reports, building the horizontal management accounting reporting system for manufactural industry based on the value chain, extends the focus of the internal management of enterprises from the production processes to the entire value chain, breaks down the shackles that management accounting information can not be delivered effectively among departments, integrates the information between departments reinforcing coordination of different parts of the value chain, helps enterprises to obtain sustainable competitive advantage.The research method is innovative. Most of the existing management accounting report studies is theoretical. This article uses the case study method, by entering the case enterprise to conduct field research, collecting data in different ways, and studies specific issues in specific business environment. By carrying out the questionnaire survey, conducting semi-structured interviews with senior management, combining with internal data, to build Triangle evidence chain, reinforce the probative force of the evidence, increase the authenticity of data collected. On this basis, combined with the enterprise management practice, the Design the needed reporting content and reporting formats for the case enterprise and make the management accounting reports more informative and have great practical value.