Gap between Application and Perceived Importance of Management Accounting Practices in Bangladesh: A

Proposed PERAPPGAP Model

Abstract: Practice of Management accounting is essentially being driven by logic and intuition which is certainly
other than mandatory requirement as it is in case of financial accounting. Thus management accounting practice
follow a contingency framework and is characterized by such factors which is properly aligned with the
environment where the firm operates, firm specific factors, practitioners’ perception and owner-manager’s
requirements. Due to these characterizations, management accounting practice is always critical and observes a
compromised demonstration in its diffusion. Considering the importance of this issue, this paper tries to propose a
generic model named as PERAPPGAP Model to quantify the gap that exists between the perception and
application of different management accounting tools. The analysis is based on a semi-structured questionnaire
survey where the respondents are professional accountants working in different manufacturing firms. This paper
presents a template that can be used to calculate a gap score for each firm with the option of easy customization
depending on the requirements. As an extension to this model, the paper also highlights some relationships between
the gap scores and other firm specific factors like profitability, turnover and net assets. Different parametric and
non-parametric statistical tools like Mann-Whitney U Test, Kruskal Wallis Z Test, Exploratory Factor Analysis
(EFA), Multiple Regression Analysis along with other descriptive statistical tools are applied to test relevant
hypothesis.