Expanding The Basics of Neuroscience in Management Accounting

Recently, neuroscience has been used in the fields of psychology, economics, and finance, and its usefulness has been demonstrated. The main purpose of this study is to expand the literature of neuroscience to accounting. In attaining this goal, and for the first time, this research stimuntaniosly studied behavioral activation system (BAS) and behavioral inhibition system (BIS) as the main independent variables and brain spheres performance, as a moderating variable, on the management accountant's strategic decisions activity, as the sub category of accounting.

The research method is descriptive-survey. The statistical population was consisted of all management accountants of Tehran Stock Exchange companies in 2019. The effect of the preceding variables was assessed by designing different scenarios and exerting a questionnaire on a Likert scale of five options. Structural equation modeling (SEM) was used to investigate the effect of variables and the partial least squares (PLS) approach was adopted to analyze the patterns.

The results showed that BAS posits a direct effect and BIS has an indirect effect on the marketing, operational, human resources, accounting and budgeting activities of management accountants. The specialized function of each left and right hemisphere of the brain as a moderating variable on the activities of management accountants is different. The interactive role of "BAS and the left hemisphere" and the interactive role of "BIS and the right hemisphere" on the activities of accountants are positive and significant. In contrast, the interactive role of "BAS and the right hemisphere" as well as the interaction of "BIS and the left hemisphere" do not maintain a significant effect on the activities of management accountants.

Neuroscience greatly expands the knowledge of accounting and management accounting in various fields, especially in the field of strategic activities and behavioral domains. This knowledge can explain the accountants and auditors' decision-making process more fully and eliminate the dark corners of their neural behaviors in making a decision. In addition, managers, accountants, analysts, and academics can benefit from the findings of this study, both professionally and theoretically, regarding brain function and neuroscience behavior.

Contribution: 

The model presented in this article is original and proliferates the literature of “Neuro Accounting”. Empirical findings largely explicate the reasons for the differences in strategic decision-making of management accountants in practice and their effects. This model can be exerted and extended by other accountants, managers, and academics as well.