Quality Scandals and Management Accounting

Abstract

The recent spate of quality scandals is not unrelated to management accounting. This paper examines the problems common to Japan’s manufacturing industry that lie behind the quality scandals and explore their causes. In fact, the negative impact of the management accounting system is also hidden behind these problems. Furthermore, the series of quality scandals has exposed the reality that corporate governance in Japan is not functioning effectively. Management accounting systems are seen as playing a central role in this corporate governance. Of course, in order to achieve this, no small amount of change is required. In this paper, we will try to look at how such changes should be made.