WHO'S KEEPING SCORE? MANAGEMENT ACCOUNTING USE AND THE BRITISH COLUMBIA GOLF INDUSTRY

Abstract

This study investigated how small and medium-sized enterprises implement management accounting techniques, the reasons for doing so, and whether those techniques and profitability may be correlated. Past research has largely focused on such implementation in large organizations. The current study seeks to fill this knowledge gap, using the golf course industry in Canada as exemplar. Using institutional theory as the framework, semistructured interviews were conducted with 25 general managers/owners of golf courses to identify the management accounting techniques golf courses were using and how they used this information to drive business decisions. Resulting techniques were found to be key performance indicators, variance analysis, and an informal version of the balanced scorecard. On golf courses whose general managers/owners consistently used budgets, took ongoing professional development courses, and had more than 20 years’ experience, ordinal logistic regression found higher earnings before interest, taxes, depreciation, and amortization as a percentage of sales. Budgets were extensively used on the golf courses. Proximity to revenue centres created a different way of using budgets. General managers/owners whose offices were near revenue centres used budgets to confirm preexisting financial assumptions, whereas those with offices at a distance from revenue centres used budgets to verify financial information. Over the last decade, the golf course industry in Canada has suffered great financial stress. More golf course facilities have closed than have opened, and core golfers are golfing less. A best practice for the golf course industry was prepared, to address this issue. It added a flexible budget and variable and fixed costs, and created a one-page dashboard with five key performance indicators to allow for a quick and efficient way to evaluate the finances of the golf course.