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The rise and fall of Activity Based Costing in Japan

Conference Paper


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Abstract


  • Activity Based Costing (ABC) has come to light in an era where there was worldwide

    attention for Japanese management systems and management accounting practices.

    Despite the worldwide hype for ABC as a method capable of producing more accurate

    product costs, ABC gathered very little interest from the business community in Japan.

    However, in contrast, Japanese management and cost accounting researchers took a

    positive view on the concept and attempted to discuss its applicability to Japanese

    companies as a viable alternative for their existing cost systems. Although, the

    collapse of the Japanese bubble economy in early 1990s provided some impetus for

    Japanese companies to show interest in ABC, there was no evidence of them adopting

    the practice, nor any serious attempt to do so. This paper seeks to examine the

    response of the Japanese business community and academics with respect to ABC and

    to summarise the reasons for ABCs’ lack of popularity in Japan as a viable cost

    accounting system for Japanese companies. This has been done predominantly via a

    review of Japanese academic literature, which has revealed that the main objective of

    the researchers was to introduce the concept of ABC and to open up discussion about

    its merits for Japanese businesses rather than to promote its adoption by them. The

    fact that Japanese companies already have good cost management systems, which are

    either effective or somewhat similar to the concept of ABC, and their interest lies on

    long term growth rather than short term profitability, are among the main reasons for

    the lack of popularity of this concept in Japan. Despite the lack of popularity of ABC

    in Japan as a useful costing system and the doubt about its usefulness for Japanese

    businesses, the academic discussions on the ABC have certainly provided Japanese

    companies a useful reference for assessing the strength and weakness of their own

    costing systems.

Publication Date


  • 2013

Citation


  • Ozawa, H. & De Zoysa, A. (2013). The rise and fall of Activity Based Costing in Japan. APMAA 2013 Annual Conference (pp. 1-14).

Ro Full-text Url


  • http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1484&context=buspapers

Ro Metadata Url


  • http://ro.uow.edu.au/buspapers/482

Start Page


  • 1

End Page


  • 14

Place Of Publication


  • http://www.dab.hi-ho.ne.jp/s-ueno/APMAA_asia/2013_conference.htm

Abstract


  • Activity Based Costing (ABC) has come to light in an era where there was worldwide

    attention for Japanese management systems and management accounting practices.

    Despite the worldwide hype for ABC as a method capable of producing more accurate

    product costs, ABC gathered very little interest from the business community in Japan.

    However, in contrast, Japanese management and cost accounting researchers took a

    positive view on the concept and attempted to discuss its applicability to Japanese

    companies as a viable alternative for their existing cost systems. Although, the

    collapse of the Japanese bubble economy in early 1990s provided some impetus for

    Japanese companies to show interest in ABC, there was no evidence of them adopting

    the practice, nor any serious attempt to do so. This paper seeks to examine the

    response of the Japanese business community and academics with respect to ABC and

    to summarise the reasons for ABCs’ lack of popularity in Japan as a viable cost

    accounting system for Japanese companies. This has been done predominantly via a

    review of Japanese academic literature, which has revealed that the main objective of

    the researchers was to introduce the concept of ABC and to open up discussion about

    its merits for Japanese businesses rather than to promote its adoption by them. The

    fact that Japanese companies already have good cost management systems, which are

    either effective or somewhat similar to the concept of ABC, and their interest lies on

    long term growth rather than short term profitability, are among the main reasons for

    the lack of popularity of this concept in Japan. Despite the lack of popularity of ABC

    in Japan as a useful costing system and the doubt about its usefulness for Japanese

    businesses, the academic discussions on the ABC have certainly provided Japanese

    companies a useful reference for assessing the strength and weakness of their own

    costing systems.

Publication Date


  • 2013

Citation


  • Ozawa, H. & De Zoysa, A. (2013). The rise and fall of Activity Based Costing in Japan. APMAA 2013 Annual Conference (pp. 1-14).

Ro Full-text Url


  • http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1484&context=buspapers

Ro Metadata Url


  • http://ro.uow.edu.au/buspapers/482

Start Page


  • 1

End Page


  • 14

Place Of Publication


  • http://www.dab.hi-ho.ne.jp/s-ueno/APMAA_asia/2013_conference.htm