BUS707 Applied Business Research - Impact of Organization Culture on Accounting Systems

Research Title

“The Impact of Organization Culture on Accounting Systems”

Research Background

Culture eats strategy for breakfast (Cave, 2017). This is a famous saying by Organization Development practitioners. The saying merely means that no matter how excellent and well thought systems and strategies are made, the implementation and sustainability of these strategies are based on the culture of the organization.  

Approximately, the world population is over 7.5 billion people divided between 196 countries; speaking approximately 6,500 different languages. This could easily equate to about 6,500 different cultures itself or a minimum of 196 different cultures globally. Cultures are made from belief sets, practices, customs and values of a country or community. When individuals from different cultures come together under one roof of the organization and must perform their best, the situation becomes more complex. This is where the organization’s culture steps in and sets a tone for the working environment. Just like countries vary in cultures, organizations vary in culture as well (Malcolm Smith, 2000).

The culture of an organization has a major impact on the systems and ways of working within the organization. It plays a vital role on how different functions operate and practice. In the current era of growing and innovation within the IT sector, practices in organizations are changing. Methods used in manufacturing today are focused on being more efficient than they were years ago. The current trend in organizations is to focus on a culture that promotes innovation, entrepreneurial mindset, working with the open talent economy etc. When organizations are changing the way they work altogether in order to keep up with the changes that occur in the external environment, the most challenging changes are faced by the accounting and auditing department of the organization. The underlying reason behind such challenges are pinned under the fact that for every new initiative that is taken or any new system that is implemented, a new method of accounting system will need to be set in place for support. 

Management initiatives such as Total Quality Management, Just In Time, ABC, Balanced Scorecards, Kaizen, Open Talent Economy, etc, demand the introduction of new and more compatible accounting systems. Apart from this, the accounting and auditing sector itself faces great innovations in terms of systems and software’s for organizations to implement to work towards better and more efficient accounts management systems. External factors such as law enforcement also have a major impact on the organization’s culture which further impacts the accounting practices. The focus of this research is to study and analyze the impact of such changes within the organization culture and its impact on the accounting systems of the overall organization. 

Research Questions

Based on the research background, this research focuses on solving the following problems:

1. To what extend does the organization’s culture impact and influence the accounting systems of the firm.
2. To what extend does the organization’s structure have an impact on the accounting and auditing systems.