Abstract
We examine how business unit (BU) controllers balance their dual roles of providing information for both local decision-making (local responsibility) and cor porate control (functional responsibility). The existing literature suggests that organi zations can improve the quality of financial reporting and internal controls by increasing the emphasis on the functional responsibility of BU controllers. In this study, we rely on prior literature and insights from field interviews to argue that such an increase also leads to role ambiguity and conflict, which in turn can lead to an increased tolerance of data misreporting. We test our predictions using survey responses of 134 BU con trollers. As predicted, we find that the emphasis on the functional responsibility of BU controllers is positively associated with role conflict and role ambiguity, both of which are related to data misreporting at the BU level.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 1233-1253 |
| Number of pages | 21 |
| Journal | Accounting Review |
| Volume | 84 |
| Issue number | 4 |
| DOIs | |
| State | Published - Jul 2009 |
| Externally published | Yes |
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Keywords
- Controllers
- Earnings management
- Role ambiguity
- Role conflict
ASJC Scopus subject areas
- Finance
- Accounting
- Economics and Econometrics
Cite this
Balancing the dual responsibilities of business unit controllers : Field and survey evidence. / Maas, Victor S.; Matejka, Michal.
In: Accounting Review, Vol. 84, No. 4, 07.2009, p. 1233-1253.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Balancing the dual responsibilities of business unit controllers
T2 - Field and survey evidence
AU - Maas, Victor S.
AU - Matejka, Michal
PY - 2009/7
Y1 - 2009/7
N2 - We examine how business unit (BU) controllers balance their dual roles of providing information for both local decision-making (local responsibility) and cor porate control (functional responsibility). The existing literature suggests that organi zations can improve the quality of financial reporting and internal controls by increasing the emphasis on the functional responsibility of BU controllers. In this study, we rely on prior literature and insights from field interviews to argue that such an increase also leads to role ambiguity and conflict, which in turn can lead to an increased tolerance of data misreporting. We test our predictions using survey responses of 134 BU con trollers. As predicted, we find that the emphasis on the functional responsibility of BU controllers is positively associated with role conflict and role ambiguity, both of which are related to data misreporting at the BU level.
AB - We examine how business unit (BU) controllers balance their dual roles of providing information for both local decision-making (local responsibility) and cor porate control (functional responsibility). The existing literature suggests that organi zations can improve the quality of financial reporting and internal controls by increasing the emphasis on the functional responsibility of BU controllers. In this study, we rely on prior literature and insights from field interviews to argue that such an increase also leads to role ambiguity and conflict, which in turn can lead to an increased tolerance of data misreporting. We test our predictions using survey responses of 134 BU con trollers. As predicted, we find that the emphasis on the functional responsibility of BU controllers is positively associated with role conflict and role ambiguity, both of which are related to data misreporting at the BU level.
KW - Controllers
KW - Earnings management
KW - Role ambiguity
KW - Role conflict
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U2 - 10.2308/accr.2009.84.4.1233
DO - 10.2308/accr.2009.84.4.1233
M3 - Article
VL - 84
SP - 1233
EP - 1253
JO - Accounting Review
JF - Accounting Review
SN - 0001-4826
IS - 4
ER -