Management Accounting Section Midyear Meeting

Implications of a CFO’s Dual Accountability for Communication in Strategic Decision-Making

• In Event: Executives and Supervisors (Mixed Methods)

Abstract

Recent accounting studies have predominantly focused on one important dimension of dual accountability to either influence or facilitate decisions with information provision and ignored the combinative effects on communication for strategic decision-making. This study examines whether the effectiveness of strategic decisions is more likely if accounting’s informational supply is balanced with the demand in communication channels that members of the management attend. Using survey data on 82 strategic decision relationships of executives across multiple CEO-CFO settings, the results provide empirical evidence that a system of dual accountability interacts not only with a robust financial analysis performed but also with the strategic conversation about the decision at hand. Depending on the selection of communication channels, the individual dimensions of a CFO’s dual accountability can either improve or impair strategic decision-making effectiveness, while its duality substitutes and complements CEO communication for decision-making. Integrating and extending the control and strategy perspective, I analyze the positive performance implications and problematize boundary conditions to information processing in theory and practice under the attention-based view of the firm.

Author

• Stefan Illich-Edlinger, University of St.Gallen