The role of management accounting practices in enhancing project performance in Jordanian companies

Abstract

This study aimed at understanding how Management Accounting Practices enhance Project Performance in companies in Jordan, as well as understanding the effect that the phenomenon has on the effectiveness of making Mid-Level Decisions. The study utilized a quantitative approach along with a descriptive and analytical approach. Primary data was gathered through a structured questionnaire designed for employees of the targeted companies in project-based companies in Jordan. The targeted employees in this case were financial managers, management accountants, project managers, and internal auditors. 260 questionnaires were collected and analyzed, using the SPSS and AMOS software. The study employed Structural Equation Modelling (SEM) to test the hypothesized relationships as well as direct and indirect relationships of the study variables. The results showed that Management Accounting Practices positively contributed to enhanced Project Performance and Decision-Making Effectiveness. It was also found that Project Performance was positively enhanced by Decision-Making Effectiveness. In addition, it was found that Management Accounting Practices positively contributed to Project Performance through the effect of Decision-Making Effectiveness, which was found to be a partial mediation in the relationship. The findings underscored the importance of management accounting systems for the improvement of management effectiveness and project outcomes in companies in Jordan. The study contributes to theory by bringing together Management Accounting Practices, Decision-Making Effectiveness, and Project Performance, all in one framework. The findings, in practical terms, provide management and other decision-makers with information on the importance of management accounting systems in the integration of accounting data in management and strategic decisions in order to enhance project accomplishment and give the organization a competitive edge in the marketplace.