R. Rudman

Stellenbosch University (SOUTH AFRICA)
Professional bodies such as the International Federation of Accountants and related bodies such as the South African Institute of Chartered Accountants require Information Technology (IT) to be integrated with the four professional subjects. Each professional subject is different. In South Africa, various attempts have been made to do this in subjects such as Auditing, however little consideration has been given to integrating Management Accounting and Information Technology. Historically, when teaching Management Accounting, lecturers have mainly focused on numerical problem solving. Recently there has been a shift in focus in teaching to integrating numerical problem solving with strategic and business matters.

Stellenbosch University developed a Management Accounting simulation in the form of a business plan project covering the entire process of launching a new business idea. Students select a new business concept, research the viability thereof and prepare various sets of financial information, calculations, models and prepare a business plan (including obtaining supporting documentation) motivating the concept. The objective of the simulation is to integrate Management Accounting with IT, and expose students to a real-life business environment, which requires them to consider more factors than simply the numerical aspects of Management Accounting.

A questionnaire was developed to evaluate Bachelor of Accounting students’ perceptions of the benefits and constraints of a simulation (including a business plan project) as a teaching tool. Responses on the appropriateness of a simulation as a teaching tool were favourable. Respondents felt that it helped them to understand both management accounting as well as IT functionalities better. Irrespective of the learning benefits, respondents complained that they struggled to find time to complete the simulation.

The principles and findings of this research apply to simulations performed in any environment. Management Accounting has historically been taught and assessed in a very theoretical manner, focusing on the numerical aspects. This is the first South African study to show that Management Accounting can be made practical and encourage student participation. Similar to an Auditing simulation, using a Management Accounting simulation has merits.