Management Accounting Practices in Export-Oriented Manufacturing Small and Medium Enterprises in Malaysia

Most studies of management accounting practices (MAPs) globally, and specifically of Malaysia, mainly focus on large manufacturing companies. This study examines the adoption of MAPs among small and medium enterprises (SMEs) engaging in export-oriented manufacturing in selected industrial hubs in Malaysia. In the digital era, these firms are expected to adopt some relatively sophisticated management accounting techniques in their manufacturing processes and marketing strategies. Based on 2019 statistics, SMEs constitute about 98.5% of all Malaysian business establishments. Most export-oriented SMEs are very structured in nature as they must adhere to stringent international market requirements. The objectives of the present study are to evaluate the level of perceived business uncertainty facing these SMEs and to explore their level of MAPs-adoption. Questionnaires were used to collect data from the export-oriented SME respondents: of the 410 distributed questionnaires, 78 (19%) were completed, returned, and used for analysis. The results show that, overall, export-oriented firms mainly market their products within the ASEAN region and, as such, most respondents perceived their business environment as “stable and predictable.” In relation to MAPs, it is evident that the export-oriented manufacturing SMEs rely more on traditional tools and techniques, like operating budget, standard costing, capital budgeting, variable costing, cost variance analysis, full costing, CVP analysis, and ratio analysis, for the purpose of product cost information.