Capitalizing and controlling development projects as joint translations. The mediating role of the information technology

Journal title MANAGEMENT CONTROL
Author/s Antonio Leotta
Publishing Year 2015 Issue 2015/2
Language English Pages 34 P. 101-134 File size 197 KB
DOI 10.3280/MACO2015-002005
DOI is like a bar code for intellectual property: to have more infomation click here

Below, you can see the article first page

If you want to buy this article in PDF format, you can do it, following the instructions to buy download credits

Article preview

FrancoAngeli is member of Publishers International Linking Association, Inc (PILA), a not-for-profit association which run the CrossRef service enabling links to and from online scholarly content.

For internationally operating firms, development costs can be capitalized under specific conditions required by IAS 38. Some conditions refer to the "ability to measure reliably the expenditure attributable to the intangible asset during its development". To verify those conditions, appropriate Information Technology (IT) and organizational procedures may be adopted within the organization. Introduced for translating IAS 38, IT may enable the control of development projects and processes. This occurs to the extent that IT has the power to attract different agencies. Drawing on ANT inspired literature, we translate Quattrone and Hopper’s (2006) conceptualization of IT as a heteromogeneous object, which relies on an object’s combination of being a ‘fact’ and an attractor. The theoretical arguments inform a case study on the control of development projects at STMicroelectronics, a multinational company operating in the semiconductor industry. The case evidences show how capitalizing and controlling development projects are jointly translated though the mediation of IT. Moreover, the case highlights how controls of development projects are systems of conjunctions among behaviour, accounting and personnel controls which mediate among the organizational actors involved in development projects.

Keywords: Development projects, information technology, translation.

  1. Abernethy M.A., Brownell P. (1997), Management control technologies in research and development organizations: the role of accounting, behavior and personnel controls, Accounting, Organizations and Society, 22, pp. 233-248.
  2. Ahrens T., Chapman C. S. (2006), Doing qualitative field research in management accounting: Positioning data to contribute to theory, Accounting, Organizations and Society, 3, pp. 819-841.
  3. Azzali S., Mazza T. (2011), La valutazione degli Information Technology Control nell’ambito dei sistemi di controllo interno: i risultati di una ricerca empirica, Management Control, 3, pp. 91-118. DOI: 10.3280/MACO2011-003005.
  4. BallesterM.,Garcia-Ayuso M. & LivnatJ. (2003), The economic value of the R&D intangibile assets, European Accounting Review, 12(4), pp.605-633
  5. Bisbe J., Otley D. (2004), The Effects of Interactive Use of Management Control Technologies on Product Innovation, Accounting, Organizations and Society, 29, pp. 709-737. DOI: 10.1016/j.aos.2003.10.010
  6. Bergfors M.E., Larsson A. (2009), Product and process innovation in process industry: a new perspective on development, Journal of Strategy and Management, 2, 3, pp. 261-276.
  7. Bublitz B. & Ettredge M. (1989), The information in discretionary outlays: Advertising, research and development, The Accounting Review, pp. 108-124.
  8. Davila T. (2000), An empirical study on the drivers of management control technologies’ design in new product development, Accounting, Organizations and Society, 25, pp. 383-409.
  9. Callon M. (1987), Some elements of a sociology of translation: domestication of the scallops and the fishermen of St Brieuc Bay. in Law J., ed, Power, action and belief: a new sociology of knowledge? London, Routledge, pp. 196-223.
  10. Deng Z., Lev B. (2006), In-process R&D: To capitalize or expense?, Journal of Engineering and Technology Management, 23, pp. 18-32.
  11. Ditillo A. (2004), Dealing with uncertainty in knowledge-intensive firms: the role of management control technologies as knowledge integration mechanisms, Accounting, Organizations and Society, 29, 401–421. DOI: 10.1016/j.aos.2003.12.001
  12. Jones J.F. (1991), Earnings management during import relief investigations, Journal of Accounting Research, 29(2), pp. 193-228.
  13. Jorgensen B., Mesner M. (2010), Accounting and strategising: A case study from new product development, Accounting, Organization and Society, 35, pp. 184-204.
  14. Kothari S.P., Laguerre T. & Leone A. (2002), Capitalization versus expensing: Evidence on the uncertainty of future earnings from current investments in PPE versus R&D, Review of Accounting Studies, 7(4), pp. 355-382.
  15. Marchi L. (2011), L’evoluzione del controllo di gestione nella prospettiva informativa e gestionale esterna, Management Control, 3, pp. 5-16. DOI: 10.3280/MACO2011-003001
  16. Latour B. (1999), How to talk about the body? The normative dimension of science studies. Lawler S. (2002), Narrative in Social Research. In May T. (edited by), Qualitative Research in Action, SAGE Publications, Ltd.
  17. Lowe A. (2001), Accounting information technologies as knowledge-objects: some effects of objectualization, Management Accounting Research, 12, pp. 75-100.
  18. Markarian G., Pozza L., Prencipe A. (2006), Capitalization of R&D costs and earnings management: Evidence from Italian listed companies. The International Journal of Accounting, 43, pp. 246-267.
  19. Miraglia R.A. (2012), Editoriale. Nuove tendenze nei sistemi di controllo e di misurazione delle performance, Management Control, 2, pp. 5-14. DOI: 10.3280/MACO2012-002001
  20. DOI: 10.3280/MACO2012-002001
  21. Mouritsen J., Hansen A, Hansen C.O. (2009), Short and long translations: Management accounting calculations and innovation management.
  22. Nixon B. (1998), Research and development performance measurement: a case study, Management Accounting Research, 9, pp. 329-355.
  23. Nørreklit L., Nørreklit H., Israelsen P. (2006), The validity of management control topoi.
  24. Towards constructivist pragmatism, Management Accounting Research, 17, pp. 42-71. Quattrone P. & Hopper T. (2001), What does organisational change mean? Speculations on a Taken-for-granted Category, Management Accounting Research, 12(4), pp. 403-435.
  25. Quattrone P. & Hopper T. (2005), A ‘Time-space odyssey’: management control technologies in multinational organisations, Accounting, Organizations and Society, 30(7-8), pp. 735-764. DOI: 10.1016/j.aos.2003.10.006
  26. Quattrone P., Hopper T. (2006), What is IT? SAP, accounting, and visibility in a multinational organisation, Information and Organization 16, pp. 212-250. DOI: 10.1016/j.infoandorg.2006.06.001
  27. Sougiannis T. (1994), The accounting based valuation of corporate R&D, The Accounting Review, January, pp. 44-69.
  28. Vosselman E. (2014), The ‘performativity thesis’ and its critics: Towards a relational ontology of management accounting, Accounting and Business Research, 44, 2, pp. 181-203. DOI: 10.1080/00014788.2013.856748

  • Critical Thinking Skills Enhancement through System Dynamics-Based Games: Insights from the Project Management Board Game Project Federico Barnabè, Stefano Armenia, Sarfraz Nazir, Alessandro Pompei, in Systems /2023 pp.554
    DOI: 10.3390/systems11110554

Antonio Leotta, Capitalizing and controlling development projects as joint translations. The mediating role of the information technology in "MANAGEMENT CONTROL" 2/2015, pp 101-134, DOI: 10.3280/MACO2015-002005