Abstract:
Management accounting measures analyzes and reports financial and
nonfinancial information that helps managers to make decisions, implement
strategy to achieve the goals of an organization. The main purpose of this study
was to examine the impact of Management Accounting Practices (MAP) on
Financial Performance (FP) of listed manufacturing companies in Sri Lanka.
Financial Performance was measured by Return on Assets. Costing system,
Budgeting system, performance evaluation system, and equity issue and
leverage were used as measures of management accounting practices. Total
population of 32 manufacturing companies were drawn as the target sample to
collect required data for the study. Structured questioner was used to gather
primary data and annual reports of the selected companies were used as
secondary data sources. Analysis was conducted by using Statistical Package
for Social Sciences (SPSS). According to study, it was revealed that there was
significant impact of costing system practices to FP and it was the highly
practiced and influential MAP amongst the manufacturing companies in Sri
Lanka. Further, budgeting system, performance evaluation system, equity
issue and leverage respectively showed an impact to financial performance.
Thus, it is advisable to manufacturing companies to pay attention for the
costing system to improve their financial performance.
