The Effects of the Use of Activity-Based Costing Software in the Learning Process: An Empirical Analysis

Abstract

This study investigates the influence of the use of accounting software in teaching activity-based costing (ABC) on the learning process. It draws upon the Theory of Planned Behaviour and uses the end-user computer satisfaction (EUCS) framework to examine students' satisfaction with the ABC software. The study examines students' satisfaction with the software and the mediating role it plays between assignment clarity and the understanding of ABC and between assignment clarity and their intention to learn more about the software used. We use a Partial Least Squares (PLS) path model to examine the framework of the study and draw on survey data. Our findings suggest that students' satisfaction with the ABC software plays a pivotal role in the learning process. This satisfaction not only has a significant direct impact on both students' perceptions of their understanding of ABC and students' willingness to learn more about the ABC software used, but it also fully mediates the relationship between assignment clarity and students' willingness to learn more about the software. Further, students' satisfaction with the ABC software enhances the effect of assignment clarity on the understanding of ABC concepts. Anecdotal evidence suggests that the use of the software improved the depth of students' understanding of ABC at both conceptual and practical levels.

Keywords:

• Management accounting
• activity-based costing software
• end-user computer satisfaction
• students' perceptions
• survey

Acknowledgements

The authors are very grateful to Balasingham Balachandran and Nihal Mudalige for their contributions to the development of this research project. The authors also gratefully acknowledge useful comments and suggestions from James Rebele, Beverly Jackling, Catherine Barratt, Carlin Dowling, Sigi Goode, Marie Kavanagh, Carla Wilkin and Greg van Mourik. We would like to thank the participants of the Accounting and Finance Association of Australia and New Zealand Conference (Wellington, 2006) and two anonymous referees for the useful and valuable comments and recommendations. Finally, the authors are grateful to Wynne Chin for the use of PLS Graph V3.0.

Notes

We acknowledge that there are other theoretical conceptualisations of how people learn, including those that see learning as behaviour (e.g. Skinner, 1953), as an understanding (e.g. Piaget, 1969), or as a social practice (e.g. Bandura, 1986). Each and every one of these conceptualisations, as well as the constructionist, has its merits and limitations.

We further elaborate on the issue of validity in the research method section.

ABC Quick software was chosen because its modules dovetail with basic activities based on costing concepts as set out in most modern textbooks on cost and management accounting. Anecdotal evidence regarding the popularity of this particular software indicated that the major banks and large manufacturing, retail and service companies were using it.

Scriven and Paul (cited in The Critical Thinking Community, 2009) define critical thinking as ‘the intellectually disciplined process of actively and skilfully conceptualising, applying, analysing, synthesising and/or evaluating information gathered from, or generalised by, observation, experience, reflection, reasoning or communication, as a guide to belief or action’. Using analogy, the assignment required students to put together a ‘Lego’ where the only major structural elements were outlined to them. As such, students had to construct the pieces, find logic, reflect on meaning, and establish relationships between parts, all of which are elements of critical thinking.

A preliminary examination of the software and prototype models constructed by the lecturer indicated that ABC models created in Microsoft Excel could be easily replicated using the ABC software without the need for complex formulae or macros.

The software made it easy to generate an array of reports and provided an error correction facility. It also allowed reports to be exported to MS Excel for further analysis if required.

The reward was a small chocolate bar that was included in the pack provided to every participant.

With the benefit of hindsight, we acknowledge that it would have been preferable to include the use of a multi-item construct to reduce measurement error.

Incidentally, unstructured discussions with students suggest that creating hypothetical data and variables for the hypothetical company provided the greatest challenge and contributed significantly to students' understanding of ABC. The use of the created data to build the model provided them with hands-on experience of model-building using the ABC software.