One of the challenges of management accounting is to help managers to optimise both the immediate and distant future of their organisations. In particular, management accounting should help individual managers consider both the immediate and delayed outcomes of their decisions.
In practice, managers often behave myopically when they are overly concerned with short-term results, while neglecting the long-term - which is important.
Management accounting systems should be designed to curb this inclination, but are often unsuccessful and may even encourage myopic tendencies. For example, while the balanced scorecard (BSC) and value based management (VBM) philosophies both aim to prolong managers’ time horizon, their heavy reliance on immediate performance measures arguably makes them achieve the opposite.
This study investigates how imposing accountability on managers may affect their myopic tendencies. The research includes analysis of brain activity during task performance to identify the cognitive processes that affect decision making under different forms of accountability.
Complementing behavioural findings with insights enabled by functional neuroimaging can significantly contribute to our understanding of how management accounting systems, and in particular the use of accountability structures, impact myopia.