Accounting and management control systems unit


“…management control is a critical function in organisations. Management control problems can lead to large financial losses, reputation damage, and possibly even to organisational failure…to have a high probability of success, organisations must maintain good management control…organisations that have not achieved good control, either because they have not implemented an MCS or because they have not implemented one well, are likely to face severe repercussions…”

Merchant & Van der Stede (2007) Management Control Systems: Performance Measurement, Evaluation and Incentives

Courseware slide - Accounting and Management Control Systems Unit whiteboard.

As the above statement indicates, achieving good management control – which includes utilising an organisation's management accounting systems – is a vital element in 'successful' entities. We can all, I'm sure, think of recent instances where an organisation's management (accounting) controls have proved to be 'weak'. Barings Bank? Enron? World-Com? Farepak? Northern Rock? XL.Com? Lehman Bros? Woolworths? Setanta? Toyota? British Airways? BP? Goldtrail-Sun4U-Kiss Flights….? Achieving such effective control in today's complex and volatile economic environment, however, means that management accountants are faced by some considerable challenges and, it can also be argued, by some significant opportunities too (see Poundland, for example!).

Courseware slide - Accounting and Management Control Systems Unit.

With this situation in mind, the overall approach taken by this course is to identify some of the most notable performance issues faced by organisations. Then, by drawing on both conceptual and empirical [real-world!] perspectives, the means by which management accounting systems can be best developed to assist and support the management control of these operations is considered.

These are interesting and challenging times for management accountants. Indeed, a number of important new management accounting techniques have been developed in recent years, while the relevance and usefulness of some of the more 'traditional' management accounting tools are being increasingly questioned. It is certainly a field in which both students and practitioners alike are strongly advised to keep themselves up-to-date with current ideas and emerging developments – or risk being left 'dangerously' behind!

Welcome then to the somewhat 'unpredictable' world of Accounting for Accounting and Management Control Systems!


The primary aim of this course is to enable students to understand and critically evaluate the relevance and potential impact of key management accounting control systems within a range of topical organisational contexts. An essential prerequisite for this is an appreciation of the many ambiguities and difficulties associated both with the effective management of organisations as well as with the increasingly chaotic competitive environment within which such entities operate.

In order to achieve this aim then, a range of relevant theoretical and conceptual issues and developments will be identified, and their application to/significance for 'real-world' situations considered.

Learning outcomes

By the end of this course you should be able to:

  1. Analyse the historical development of the theory and practice of accounting and management control systems.
  2. Synthesise accounting and management control concepts with real-world situations, selecting and/or designing systems appropriate to different contexts.
  3. Comprehend complex business problems and provide pertinent solutions, utilising advanced research and analysis skills and communicating relevant management information and discussion in a suitable form.
  4. Critically evaluate the effectiveness of traditional accounting and management controls, and assess research regarding emerging developments.
  5. Manage own learning and enhance self-knowledge, developing life-long learning skills and engaging in constructive self-reflection.

Reading list

The recommended text for this unit is:

  • Merchant, KA and Van der Stede, WA (2007) Management Control Systems: Performance Measurement, Evaluation and Incentives (2nd edn), published by Financial Times/Prentice Hall.

This text, along with all other additional reading referenced throughout the learning unit, is available via the Manchester Metropolitan University digital library. Students enrolled on the programme will have access to this digital library and as such, do not need to purchase any text books.