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Equivalent units of production: a new look at an old issue

Reinaldo Guerreiro, Edgard Bruno Cornachione and Armando Catelli
Department of Accounting and Actuarial Sciences, School of Economics, Business and Accounting, University of Sao Paulo, Sao Paulo, Brazil
Abstract
Purpose This paper focuses on the determination of the cost completion rate used to calculate the equivalent units of production in a continuous process costing system. The paper aims at two research questions. What procedures do companies utilize in practical terms? How should the completion level percentage be calculated conceptually? Design/methodology/approach The study is a qualitative exploratory survey. The companies targeted were those noted in Melhores e Maiores, a ranking of the best and biggest Brazilian companies. A total of 175 questionnaires were sent to pre-selected enterprises, each with revenues of more than US$100 million per year, and 50 usable responses were returned. Findings A literature review of the theoretical procedures used for continuous process costing revealed no indication of an objective method for determining the completion level. The empirical research in the present study conrmed that, in practice, companies do not adopt the general procedures proposed by the theory. The best practices applied by the companies have been shown to be an adequate alternative, because the results are identical to those obtained with the proposed method. Research limitations/implications The study bears the usual limitations of a qualitative exploratory survey regarding its generalization to other companies. Originality/value The originality of the study is based on the assumption that cost accounting theory does not offer an objective solution for the computation of the completion level percentage and, consequently, that companies in continuous process production system do not adopt the theoretical concepts with respect to inventory evaluation of goods-in-process and nished goods. Keywords Cost accounting, Costs, Production management, Brazil Paper type Research paper

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Introduction Almost all cost accounting books present contents related to costing method in a continuous production system. It is generally agreed in the literature that the basic procedures involve: . the quantication of the physical units of output; . the determination of the number of equivalent whole units; . the calculation of the cost per equivalent unit; and . the evaluation of the units completed and transferred out of the department and units in ending work-in-process inventory. How much of a totally nished good is represented by a unit in process? The answer is provided through the nishing level percentage of the unit in process. By using the completion level percentage, it is possible to make a comparison between the units in
Managerial Auditing Journal Vol. 21 No. 3, 2006 pp. 303-316 q Emerald Group Publishing Limited 0268-6902 DOI 10.1108/02686900610653035

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process and these same units considered as being fully completed. Consequently, the number of equivalent units of production corresponds to the number of units in working process as converted into completed units, through the use of a dened completion rate. In the case of raw materials cost, which is introduced entirely at the beginning of the production process, the completion level is 100 per cent, but when raw materials and other resources are combined in the course of the production process, the completion level should be estimated. An important aspect to be observed is that the completion level must have meaning in economic terms, and not merely in physical terms. The completion level must represent how much a unit in working process has received of the cost load that would be needed to start and nish it completely. The present research arose from a review of a selected collection of classic works by cost accounting authors. This review revealed that these authors did not indicate a method for calculating the completion level percentage. From a conceptual perspective, this represents an exciting prospect in cost accounting because this gap in the literature implies that companies operating on a continuous process do not, in practice, use the theoretical procedures of cost accounting authors. The proposition of the present study is that cost accounting theory does not offer an objective solution to the problem of calculating the completion level, which is required for determining the number of equivalent whole units in continuous process systems producing homogeneous products. This lack of an objective solution means that enterprises in continuous production industries do not adopt the fundamental concepts dened by theory regarding to the nished output and work-in-process inventory measurement. Calculating the completion level percentage is of primary importance because it is impossible to calculate the equivalent whole units without this rate. In such circumstances, calculation of the cost per equivalent unit becomes impractical as a basis for evaluation of goods inventories and determination of prot. Consequently, whichever theoretical treatment of this subject is adopted, the approach is useless because companies cannot adopt a methodology in practice in the absence of any available operational procedure. So, the following research questions are established: RQ1. What procedures do the companies utilize in practical terms? RQ2. How should the completion rate be calculated conceptually? Literature review Cost accounting authors have not dealt with the specic question of calculating the completion level in a convincing way. The majority have endorsed the use of the completion rate, but do not indicate an objective methodology for its calculation. Bierman and Drebin (1968, p. 45) said: one complication is the determination of equivalent units of production. Nelson and Miller (1977, p. 215) afrmed:
Based on estimates of percentages of completion of the goods-in-process (which probably are imprecise) estimates are made of the equivalent nished production.

Dearden (1976, p. 27), focusing on the process cost accumulation, emphasized that the major problem consists in determining the goods in work-in-process inventory

in equivalent units terms (two units, half nished, are equal to one nished unit). Li (1966, p. 107) claimed that the completion level for direct labor and manufacturing overheads must always be 50 per cent, unless there are indications to the contrary. He justied this proposition in the following terms:
For an enterprise using continuous processing techniques, the amount of labor and manufacturing overhead added to materials increases at a xed increment. At any given moment, the amount of labor and manufacturing overhead added ranges from 1 per cent (for the item just introduced into the process) to 99 per cent (for the item just about to be transferred to the subsequent process). Together with all other items in the process, they form an arithmetic series (1, 2, 3, . . . , 97, 98, 99 per cent) for an average completion rate of 50 per cent. This is known as the 50 per cent completion assumption.

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The present authors believe that Lis (1966) justication represents more of a value judgment than a scientic proof. The present authors agree with Horngrens (1972) opinion that the assumption that all conversion costs are incurred uniformly in proportion to the degree of product completion is difcult to justify on theoretical grounds. Although Horngren (1972) did not present a method for calculating the completion level, he did begin to develop a possible solution, observing that the conversion costs sequence usually consists of a number of standard operations or a standard number of hours, days, weeks, or months for mixing, heating, cooling, aging, curing, and so forth. Thus, the degree of completion for conversion costs depends on what proportion of the total effort needed to complete one unit or one batch has been devoted to units still in process. Similarly, Morse (1981), without presenting a solution for the problem, did indicate a conceptual approach, when he afrmed that standard cost systems are most frequently used when identical units are produced on a continuous basis. The use of standard costs eliminates the need to compute the cost per equivalent unit. The equivalent unit cost is the standard cost. Additionally, the costs transferred out are equal to the number of units completed times the standard cost per equivalent unit. Black and Edwards (1979) focused on the equivalent production unit (EPU) in saying that, if either of these assumptions is changed different EPU computations will be required. These authors did not provide any indication of how to obtain the completion level for the EPU calculation. Moore and Jaedicke (1976, p. 292) afrmed that in process cost accounting, the problem of determining unit costs is resolved by using equivalent units. After determining carefully what the equivalent units of production are, the authors presented examples in which the completion level concept was used to calculate the equivalent units of production, but without any indication of the procedures followed in obtaining it. Leone (1980, p. 195) gave an example that at the beginning of the month, in a determined production stage, there were 12 pool balls which were 50 per cent completed, i.e. only the halves were completed. However, throughout his explanations, Leone (1980) did not address the issue of the calculation of the completion level. Backer and Jacobsen (1978, p. 288), in commenting on the calculation of the equivalent units of production, noted that the completion level of work-in-process units must be estimated by qualied technical staff. These authors thus transferred the problem to qualied technical personnel. But who are these qualied technical personnel? It is likely that the authors were referring to engineering, process control, or production control technicians. The problem with this approach is that, although

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technical personnel might well be qualied to calculate the physical completion rate, they are less likely to be qualied to calculate the completion level in terms of costs. The completion level that must be used to calculate the equivalent units of production is the cost completion rate. In this sense, the present authors agree with Horngren (1972, p. 597) when he observed that unit cost is not calculated on the basis of physical units. It is calculated on the basis of cost equivalent unit performance i.e. on the basis of charges or doses of cost needed to complete a given unit. The research carried out into the important cost accounting books of the late twentieth century did not give any indication of how to calculate the completion rate. The books analyzed were: Bierman and Drebin (1968), Howard (1966), Horngren (1972), Dopuch et al. (1974), Dearden (1976), Moore and Jaedicke (1976), Corcoran (1977), Nelson and Miller (1977), Backer and Jacobsen (1978), Matz et al. (1978), Black and Edwards (1979), Leone (1980), Morse (1981), Maher and Deakin (1994), Maher et al. (1997), Hansen and Mowen (1997) and Cooper and Kaplan (1999). A consideration of more recent literature indicates that new cost accounting books and new editions of earlier books still fail to present a method for determining the completion level of work-in-process units. These newer works are Morse et al. (2000), Anthony and Govindarajan (2000), Atkinson et al. (2000), Garrison and Noreen (2001), Jiambalvo (2001), Warren et al. (2001), Willson et al. (2001), Martins (2003) and Horngren et al. (2004a, b). The research ndings in cost accounting papers, as indicated by the literature review, have not resolved this problem. Exploratory study An exploratory study was conducted to obtain a general understanding of the practical procedures used by companies related to the costing of goods-in-process in the various production segments of continuous processes in the manufacture of homogeneous products. The study is strictly exploratory and, as such, there is no suggestion that the results can be generalized to other enterprises. The database of Fipeca the Brazilian Institute for Accounting, Actuarial and Financial Research Foundation was used in selecting the companies. The companies targeted in our sample were those noted in Melhores e Maiores, a ranking of the best and biggest Brazilian companies. A total of 175 questionnaires were sent to pre-selected enterprises, each with revenues of more than US$100 million per year, and the 50 returned questionnaires are analyzed as follows. Findings Question 1. Does any segment of the manufacturing plant work as a continuous process i.e. by continuous manufacturing of an homogeneous product? From the total of 50 returned questionnaires, 43 enterprises worked on a continuous process and seven on a production order system. The reections that follow are made on the basis of the information given by the 43 enterprises that worked on a continuous manufacturing process. Question 2. What is the main activity of this segment? Most rms were involved in food processing or chemical and petrochemical enterprises. The sectoral distribution of rms is as follows: paper and cellulose,

14 per cent; sugar and alcohol, 5 per cent; heavy industries, 19 per cent; metals mining, 12 per cent; food production, 27 per cent; and petrochemical and chemical, 23 per cent. Question 3. In the segment of the manufacturing plant operating by a continuous process system, does the enterprise use the completion rate and equivalent units of production concepts to assess the costing of goods-in-process? A sum of 11 enterprises stated that they used the concepts of completion rate and equivalent units of production. Twenty-three enterprises replied that they did not use these concepts, even though they were well known. Nine enterprises replied that these concepts were not known internally. Of the 43 enterprises analyzed, 74 per cent did not calculate the completion rate and equivalent units of production. These results are very signicant in the context of establishing the validity of the fundamental hypothesis of this paper. Question 4. Which department of the enterprise computes the completion rate? This question was answered only by the 11 enterprises that stated that they used the concepts of completion rate and equivalent units of production. The accounting department was most likely to be responsible for the calculation of completion rate (46 per cent), followed by production/manufacturing (27 per cent), production planning & control/process control (18 per cent) and others (9 per cent). Question 5. How does the enterprise calculate the completion rate? (Give us a broad outline.) Some explanations given by the enterprises with respect to the calculation of the completion rate are reproduced below. (1) It is globally dened that every good-in-process has 80 per cent completion level. (2) The cost is computed per product in each process phase. There is a cost matrix that details the specic consumption of each product cost component for each process phase. The matrix considers the process benets and the productivity in each phase or equipment. Every cost computation is made phase by phase for each produced ton. The equivalent unit of production is the ton of each product, or for each product code that is specied by type of steel (chemical composition, prole, nishing level, quality level and special ows). (3) Legal quality standards required by the market and measured by laboratories installed inside the manufacturing plants. (4) Research was undertaken by the production department in order to identify the volume of existing equivalent units of production in process. This volume results from calculations that were based on the residues, pastes and unnished cellulose present along the lines, from the entry of wood until the packaging. Consequently, from knowledge of the woods average efciency, the entrance cubic volume and nished production of the period were veried. The difference between the cellulose production that the wood will generate and what was effectively produced represents the unnished volume, on which the completion percentages of equivalent production units were applied.

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(5) We use production order control on which technical specications and the operations for the production appear. Through the daily appointment of the manufacturing sectors (lithography, printing and assembly), we register in each production order the operations and the nished production, generating at the end of each accounting period a report which contains the situation and the completion rate of the goods-in-process. (6) It is based on the production standard routines, applied to the specic production phase in which the parts are weighted by the real consumption and the really spent production hours. This constitutes the basis for the inventory evaluation. (7) It is calculated for each type of product made by the enterprise. For instance, crystal sugar, rened sugar, liquid sugar, hydrated alcohol, etc. (8) Considering the product or its nal feature. (9) We dene specic codes that indicate that a given product is in process and, therefore, we can attribute the raw material costs, variable expenses, xed expenses, depreciation and, in some cases, the packing material. (10) All production is controlled by lots, entries of goods-in-process and the corresponding nished output. (11) Using the physical-chemical quantication and the nal use of the product by the client. Explanation (1) shows that only one enterprise used an explicit percentage (of 80 per cent), but it did not specify how this percentage was obtained. Explanations (2) and (6) indicate that the companies adopt concepts related to the determination of the completion level rate, meanwhile they did not specify clearly the calculations. Explanations (3), (4), (7), (8) and (11) are too generic, approaching aspects not directly related with the computation of completion level percentage. Explanations (5), (9) and (10) mention the use of product code and order control, concepts that are usually applied in the order costing system. Generally the answers demonstrated that, in many companies, there existed misunderstandings about the concepts of completion rate and equivalent units of production. Question 6. What procedure does the enterprise use to evaluate the work-in-process inventory on a monthly basis? This question was analyzed for the group of 32 companies that did not adopt the concepts of completion level and equivalent units of production. Two of them replied that they were using the standard cost. Seven enterprises considered the closing inventory of work-in-process to have a zero value because of the characteristics of the production process. Nine enterprises replied that they used the standard cost, calculated cost variations, and proportionally distributed the variations to production and to the work-in-process inventory. The other 14 enterprises did not specify explicitly which procedures they used. The following expressions appeared in certain replies: . actual monthly average cost; . we use the average cost to evaluate the inventory;

. . . . . . . .

production orders are opened; the costing is the actual monthly cost; joint costs theory and full costing; the goods-in-process inventory is very small but we are using the average cost; average unit cost computation; monthly average cost; actual cost per production phase; and use of one costing for each production phase with real appointments of quantities produced in each one of these phases.

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In these selected quotations from the responses received, it can be observed that emphasis was given to the calculation of the cost per unit. It must be noted, however, that cost accounting does not use the concepts of completion level and equivalent units of production for the calculation of the unit cost. It can be inferred that, in practice, the companies simplied in order to obtain the unit cost, considering units in process as being equal to transferred or nished goods in cost terms. Nine companies revealed the use of the scientically valid procedure, using the standard costing method including the distribution of the cost variations to production and to the ending inventory, as demonstrated in item 6. Proposed method for calculating the completion level In the light of the above discussion, the present study proposes a method to calculate the completion level. The proposed method rests on the concept of standard cost. Given that: ga, completion rate; ep, each production stage of the product; cp, standard unit cost accumulated until the specic stage; cf, nished product unit cost; and q, quantity of goods-in-process at a given specic stage. The fundamental premise is that the completion rate must reect the nishing level in cost terms. That is, if it is established that a product is a per cent completed, this means that the product has received a per cent of all costs that will be required from start to nish. At the level of each specic production stage, the ga equals cp/cf. If cost accounting were performed at each specic stage (i.e. a calculation of the realized manufacturing costs of the period, a calculation of unit costs, an evaluation of the initial inventories, a calculation of production costs transferred to the next stage, an evaluation of ending inventories, and so on), the completion level problem would be solved. Keeping in mind that a companys cost accounting is not, with rare exceptions, analyzed stage-by-stage, because it requires information and analytical controls that are not always available, the completion level should be calculated at the level of the manufacturing plant. Returning to the fundamental assumption that the completion level is given in cost terms, it can be observed that goods-in-process (allowing for different quantities at different stages of the manufacturing process) will be a per cent completed when they receive a per cent of all costs required to start and nish them. This requires a consideration of the sum of the cp/cf ratios weighted by the respective quantities (qp) that exist in the different stages.

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So, to realize the required weighting: P qp cp ga P qp cf Keeping in mind that cf is always the same for all units: P qp cp ga P qp cf To illustrate the proposed model, a numerical example of calculating the completion rate is presented below. Consider the continuous manufacturing process of a unique product involving ve stages. At the end of a given period, a physical inventory of the quantity of goods-in-process (qp) is made at various specic stages (ep) (Table I). The standard unit cost of the product is presented below, as accumulated at each specic stage (cp) (Table II): Applying the proposed formula: P qp cp ga P qp cf P P requires a calculation of qp cp and qp cf These calculations are performed as follows. P qp cp value is calculated and the results are shown in Table III. The amount of $1,045,000 represents the cost of all units in process, considering the stage that they have reached. P Thus qp cp $1; 045; 000

310

ep 1 2 3 4 5

qp (u) 500 1,000 1,900 1,400 200

Table I.

ep 1 2 3 4 5

cp ($) 50 120 200 300 500

Table II.

P qp cf represents how much the total cost would be if all the units in process were P P nished: qp 5; 000u; cf $500; qp cf 5; 000u $500 $2; 500; 000; P Thus qp cf $2; 500; 000 The calculation of ga can now be performed using the proposed formula: P qp cp ga P qp cf The completion level, in cost terms, of the units in process at the end of the period thus becomes: P qp cp ga P qp cf Therefore: ga Thus ga 41.8 per cent. Comparison of the proposed model and the best practice used by some companies An example of process costing using the completion level and equivalent units of production calculated in accordance with the proposed theoretical solution is presented below. The results are compared with the standard costing method, including the distribution of the cost variations to production and to the ending inventory this being considered the best practice used by the companies. The following data are given: ct, $9,000,000; qf, 15,000u; qp, 5,000u; and ga, 41.8 per cent. Applying conventional cost accounting procedures using the completion rate for production costing leads to the following: (1) Calculation of the equivalent units of production: qe 5,000u 0.418 qe 2,090u. (2) Calculation of the production unit cost of the period: cp $9,000,000/(15,000 2,090)u cp $526,624/u.
ep 1 2 3 4 5 qp (u) 500 1,000 1,900 1,400 200 cp ($) 50 120 200 300 P 500 (qp cp) qp cp ($) 25,000 120,000 380,000 420,000 100,000 1,045,000

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$1; 045; 000 4:18 $2; 500; 000

Table III.

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(3) Calculation of the total cost of the units completed and transferred out: 15,000u $526,624 $7,899,360. (4) Calculation of the total cost of the ending work-in-process inventory: 5,000u 0.418 $526,624 $1,100,640.

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Without using the completion rate, and assuming that the company uses standard costing with the same data as above, leads to the following: (1) Calculation of the standard cost of the production transferred to the product inventory: 15,000u $500 $7,500,000 (2) Calculation of the standard cost of the nal goods-in-process inventory (Table IV). These procedures yield the standard cost of the nished production and the standard cost of the work-in-process inventory. For legal and nancial objectives, it is necessary to determine the corresponding effective costs. The most appropriate practical alternative, as observed in some responses in the exploratory study, uses the standard values as a basis, determines the total cost variation (difference between standard cost and actual cost), and adds to the standard cost of the nished production and the standard cost of the goods-in-process inventory a specic part of the total cost variation (in proportion to the standard values), thus obtaining the accounting values. The analytical procedures involve: (1) Determination of the cost variation: standard cost of the production processed: $8,545,000 $1,045,000 $7,500,000 actual cost debited to production: $9,000,000 cost variation: $455,000(D). (2) Determination of the accounting value of the nished production: $7,500,000 [($7,500,000/$8,545,000) $455,000] $7,899,360. (3) Determination of the accounting value of the nal goods-in-process inventory: $1,045,000 [($1,045,000/$8,545,000) $455,000] $1,100,640.
Production stages 1 2 3 4 5 Total Processing quantities (u) 500 1,000 1,900 1,400 200 5,000 Unit standard cost ($) 50 120 200 300 500 Total standard cost ($) 25,000 120,000 380,000 420,000 100,000 1,045,000

Table IV.

An analysis of the numbers presented leads to the conclusion that the accounting values of the nished production and the goods-in-process inventory, as determined by means of the two methodologies, are identical. This means that, in practice, the companies that determine the nancial accounting values using the standard cost and adding an allowance for variation (in proportion to the standard values), unknowingly obtain the same result as would be obtained by the nishing level and equivalent production units, as in the model proposed. Conclusions A literature review of the theoretical procedures used for continuous process costing revealed no indication of an objective method for determining the completion level of the units in process and for calculating the equivalent units of production. The empirical research in the present study conrmed that, in practice, companies do not adopt the general procedures proposed by the theory responding to the rst research question of this study. The eld of cost accounting contains an attractive idea in the form of the completion rate concept but, until now, the accounting literature has not provided any objective method of calculation. The solution developed in this work for determining the completion rate solves the problem, and by virtue of its simplicity, makes it possible to use the process-costing method established in cost accounting theory, thus responding to the second research question of this study. On the other hand, it has also been demonstrated that one of the procedures used by companies employing a continuous process system is perfectly valid. This procedure involves the use of the standard cost and a determination of the accounting value of the nished products and the goods-in-process inventory, incorporating (in proportion to the standard values) the cost variations determined. This approach has been shown to be an adequate alternative in the absence of an objective conceptual approach, in that its results are identical to the results obtained with the method proposed for calculating the completion rate.
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Dopuch, N., Biernberg, J.G. and Demski, J. (1974), Cost Accounting: Accounting Data for Managements Decisions, Harcourt Brace Jovanovich, New York, NY. Garrison, R.H. and Noreen, E.W. (2001), Contabilidade Gerencial (Managerial Accounting), LTC Editora, Rio de Janeiro. Hansen, D.R. and Mowen, M.M. (1997), Cost Management: Accounting and Control, South-Western College, Cincinnati, OH. Horngren, C.T. (1972), Cost Accounting: A Managerial Emphasis, Prentice-Hall, Englewood Cliffs, NJ. Horngren, C.T., Datar, S.M. and Foster, G. (2004a), Contabilidade de Custos: Uma Abordagem Gerencial (Cost Accounting: A Managerial Emphasis), Prentice-Hall, Sao Paulo. Horngren, C.T., Sundem, G.L. and Stratton, W.O. (2004b), Contabilidade Gerencial (Introduction to Management Account), Prentice-Hall, Sao Paulo. Howard, D.C. (1966), Equivalent unit costing (EUCO), Management Accounting, October, pp. 59-63. Jiambalvo, J. (2001), Contabilidade Gerencial (Managerial Accounting), LTC Livros Tecnicos e Cientcos Editora, Rio de Janeiro. Leone, G.S.G. (1980), Custos Um Enfoque Administrativo (Cost: Managerial Emphasis), Editora da Fundacao Getulio Vargas, Rio de Janeiro. Li, D.H. (1966), Cost Accounting for Management Applications, Charles E. Merrill Books Inc., Columbus, OH. Maher, M.W. and Deakin, E.B. (1994), Cost Accounting, Richard D. Irwin, Burr Ridge, IL. Maher, M.W., Stickney, C.P. and Weil, R.L. (1997), Managerial Accounting: An Introduction to Concepts, Methods, and Uses, Harcourt Brace & Company, Orlando, FL. Martins, E. (2003), Contabilidade de Custos (Cost Accounting), Atlas, Sao Paulo. Matz, A., Curry, O.J. and Frank, G.W. (1978), Contabilidade de Custos (Cost Accounting), Atlas, Sao Paulo. Moore, C.L. and Jaedicke, R.K. (1976), Managerial Accounting, South-Western Publishing, Las Cruces, NM. Morse, W.J. (1981), Cost Accounting: Processing, Evaluating, and Using Cost Data, Addison-Wesley, Reading, MA. Morse, W.J., Davis, J.R. and Hartgraves, A.L. (2000), Management Accounting: A Strategic Approach, South-Western College Publishing, Cincinnati, OH. Nelson, A.T. and Miller, P.B.W. (1977), Modern Management Accounting, Goodyear, Santa Monica, CA. Warren, C.S., Reeve, J.M. and Fess, P.E. (2001), Contabilidade Gerencial (Managerial Accounting), Pioneira Thomson Learning Ltd, Sao Paulo. Willson, J.D., Roehl-Anderson, J.M. and Bragg, S.M. (2001), Controllership The Work of the Managerial Accountant. 2001 Cumulative Supplement, Wiley, New York, NY. Further reading Alnestig, P. and Segerstedt, A. (1996), Product costing in ten Swedish manufacturing companies, International Journal of Production Economics, Vol. 46/47, pp. 441-57. Ask, U. and Ax, C. (1992), Trends in the development of product costing practices and techniques a survey of Swedish manufacturing industry, paper presented at the 15th Annual Congress of the European Accounting Association, Madrid.

Benke, R.L. Jr (1995), Why are students underprepared for product costing?, Management Accounting, Vol. 76 No. 10. Bjornenak, T. (1997), Conventional wisdom and costing practices, Management Accounting Research, Vol. 8, pp. 367-82. Bjornenak, T. and Olson, O. (1999), Unbundling management accounting innovations, Management Accounting Research, Vol. 10, pp. 325-38. Brigth, J., Davies, R.E., Downes, C.A. and Sweeting, R.C. (1992), The deployment of costing techniques and practices: a UK study, Management Accounting, Vol. 3, pp. 201-12. Burns, J. (2000), The dynamics of accounting change: inter-play between new practices, routines, institutions, power and politics, Accounting, Auditing & Accountability Journal, Vol. 13 No. 5, pp. 566-96. Burns, J. and Scapens, R.W. (2000), Conceptualizing management accounting change: an institutional framework, Management Accounting Research, Vol. 11, pp. 3-25. Burns, J. and Vaivio, J. (2001), Management accounting change, Management Accounting Research, Vol. 12, pp. 389-402. Cohen, J.R. and Paquette, L. (1991), Management accounting practices: perceptions of controllers, Journal of Cost Management for the Manufacturing Industry, pp. 73-83. Cooper, R. and Slagmulder, R. (1999), Intelligent cost system design, Strategic Finance, Vol. 80 No. 12, p. 18. Dickeson, R.V. (2001), Goodbye job cost accountancy, Printing Impressions, Vol. 43 No. 8, p. 67. Drury, C. and Tayles, M. (1995), Issues arising from surveys of management accounting practices, Management Accounting Research, Vol. 6, pp. 267-80. Drury, C., Braund, S., Osborne, P., Tayles, M. and survey, A. (1993), A Survey of Management Accounting Practices in UK Manufacturing Companies, Chartered Association of Certied Accountants, London. Emore, J.R. and Ness, J.A. (1991), The slow pace of meaningful changes in cost systems, Journal of Cost Management for the Manufacturing Industry, Winter, pp. 36-45. Granlund, M. (2001), Towards explaining stability in and around management accounting systems, Management Accounting Research, Vol. 12, pp. 141-6. Granlund, M. and Lukka, K. (1998), Its a small world of management accounting practices, Journal of Management Accounting Research, Vol. 10, pp. 153-79. Green, F.B. and Amenkhienan, F.E. (1992), Accounting innovations: a cross sectional survey of manufacturing rms, Journal of Cost Management for the Manufacturing Industry, Spring. Guilding, C., Cravents, K.S. and Tayles, M. (2000), An international comparison of strategic management accounting practices, Management Accounting Research, Vol. 11, pp. 113-35. Horngren, C.T. (1989), Cost and management accounting: yesterday and today, Journal of Management Accounting Research, Vol. 01, pp. 21-32. Lowensohn, S., Jagolinzer, P. and Brands, K.M. (1998), What topics are they teaching?, Management Accounting, Vol. 80 No. 6. Otley, D.T. (1985), Developments in management accounting research, Management Accounting, September, pp. 37-42. Reinstein, A. and Bayou, M.E. (1997), Product costing continuum for managerial decisions, Managerial Auditing Journal, Vol. 12 No. 9, p. 490. Scapens, R.W. (1985), Management Accounting: A Review of Contemporary Developments, Macmillan, Basingstoke.

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