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<PublisherName>theaimsjournal</PublisherName>
<JournalTitle>Allana Management Journal of Research, Pune</JournalTitle>
<PISSN> 2581 - 3137 (</PISSN>
<EISSN>) 2231 - 0290 (Print)</EISSN>
<Volume-Issue>Volume 15, Issue 2</Volume-Issue>
<PartNumber/>
<IssueTopic>Multidisciplinary</IssueTopic>
<IssueLanguage>English</IssueLanguage>
<Season>July 2025 - Dec 2025</Season>
<SpecialIssue>N</SpecialIssue>
<SupplementaryIssue>N</SupplementaryIssue>
<IssueOA>Y</IssueOA>
<PubDate>
<Year>-0001</Year>
<Month>11</Month>
<Day>30</Day>
</PubDate>
<ArticleType>General Management</ArticleType>
<ArticleTitle>A STUDY ON RESPONSIBILITY ACCOUNTING WITH REFERENCE TO INDIAN COMPANIES USING ISM</ArticleTitle>
<SubTitle/>
<ArticleLanguage>English</ArticleLanguage>
<ArticleOA>Y</ArticleOA>
<FirstPage>80</FirstPage>
<LastPage>87</LastPage>
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<Author>
<FirstName/>
<LastName>Dalal</LastName>
<AuthorLanguage>English</AuthorLanguage>
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<CorrespondingAuthor>N</CorrespondingAuthor>
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<DOI> https://doi.org/10.62223/AMJR.2025.150209</DOI>
<Abstract>Responsibility Accounting has emerged as a vital managerial control mechanism in an era of increasing organisational complexity and decentralisation. It enables systematic performance evaluation across responsibility centres while aligning managerial accountability with organisational objectives.
Purpose: The purpose of this paper is to highlight the relevance and significance of Responsibility Accounting as an effective managerial control tool in modern organisations, particularly in the context of decentralised decision-making. The study aims to understand how responsibility centres—cost centres, profit centres, and investment centres—contribute to organisational goal achievement.
Design/Methodology/Approach: This study is based on expert opinion supported by an in-depth review of existing literature. Primary insights were collected from chartered accountants, commerce professors, and academicians to identify key elements influencing the implementation of Responsibility Accounting. Interpretive Structural Modelling (ISM) was employed to analyse the interrelationships among these elements and to develop a theoretical framework.
Findings: The ISM analysis revealed a structured hierarchy of three levels, demonstrating how different elements of Responsibility Accounting influence one another. The findings confirm that Responsibility Accounting serves as a foundation for evaluating managerial performance, controlling costs, planning revenues, and facilitating differential decision-making in decentralised organisations.
Research Limitations/Implications: The study is limited to expert opinions and does not include empirical data from organisations practicing Responsibility Accounting. The subjective nature of expert judgments may influence model formation and may vary across industries.
Originality/Value: This paper proposes an ISM-based model that conceptually explains the role and functioning of Responsibility Accounting in organisational settings. The model offers practical applicability for managers, accountants, and decision-makers seeking to strengthen organisational control mechanisms.</Abstract>
<AbstractLanguage>English</AbstractLanguage>
<Keywords>Responsibility Accounting, Responsibility units, Decentralization and Controllability, Cost Control.</Keywords>
<URLs>
<Abstract>https://theaimsjournal.org/ubijournal-v1copy/journals/abstract.php?article_id=16065&title=A STUDY ON RESPONSIBILITY ACCOUNTING WITH REFERENCE TO INDIAN COMPANIES USING ISM</Abstract>
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<References>
<ReferencesarticleTitle>References</ReferencesarticleTitle>
<ReferencesfirstPage>16</ReferencesfirstPage>
<ReferenceslastPage>19</ReferenceslastPage>
<References>Antle, R., and; Demski, J. S. (1988). The controllability principle in responsibility accounting. Accounting Review, 700–718.
Arya, A., Glover, J., and; Radhakrishnan, S. (2007). The controllability principle in responsibility accounting: Another look. In Essays in Accounting Theory in Honour of Joel S. Demski (pp. 183–198). Springer, New York, NY.
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Choudhury, N. (1986). Responsibility accounting and controllability. Accounting and Business Research, 16(63), 189–198.
Cools, M., and; Slagmulder, R. (2009). Tax?compliant transfer pricing and responsibility accounting. Journal of Management Accounting Research, 21(1), 151–178.
Demski, J. S., and; Sappington, D. E. (1989). Hierarchical structure and responsibility accounting. Journal of Accounting Research, 40–58.
Indjejikian, R., and; Nanda, D. (1999). Dynamic incentives and responsibility accounting. Journal of Accounting and Economics, 27(2), 177–201.
Indjejikian, R., and; Nanda, D. (2003). Reply to: Dynamic incentives and responsibility accounting: A comment. Journal of Accounting and Economics, 35(3), 437–441.
Lapsley, I. (1994). Responsibility accounting revived. Market reforms and budgetary control in health care. Management Accounting Research, 5(3–4), 337–352.
Rowe, C., Birnberg, J. G., and; Shields, M. D. (2008). Effects of organizational process change on responsibility accounting and managers’ revelations of private knowledge. Accounting, Organizations and Society, 33(2–3), 164–198.
Safa, M. (2012). Examining the role of responsibility accounting in organizational structure. American Academic and; Scholarly Research Journal, 4(5).
Sahay, S. A. (2003). Transfer pricing based on actual cost. Journal of Management Accounting Research, 15(1), 177–192.
Singh, A., and; Panackal, N. Total interpretive structural modelling and MICMAC analysis of social recruiting in revolutionizing HR. (No year/ journal details provided).
https://www.slideshare.net/CharlotteBance/responsibility-accounting-and-transfer-pricing-74460608
https://nscpolteksby.ac.id/ebook/files/Ebook/Accounting/Cost%20Management-Accounting%20and%20Control%20(2006)/11.%20Chapter%2010%20-%20Decentralization%20Responsibility%20Accounting-Performance%20Evaluation%20and%20Transfer%20Pricing.pdf
https://www.vedantu.com/commerce/responsibility-accounting
https://courses.lumenlearning.com/sac-managacct/chapter/responsibility-accounting-in-management/
https://courses.lumenlearning.com/sac-managacct/chapter/responsibility-reports/
https://www.igi-global.com/dictionary/total-interpretive-structural-modeling-tism/59995
https://www.valentiam.com/newsandinsights/transfer-pricing-methods
https://www.yourarticlelibrary.com/accounting/responsibility-accounting/4-types-of-responsibility-centres/52904
https://www.myaccountingcourse.com/accounting-dictionary/investment-center
https://www.economicsdiscussion.net/cost-accounting/cost-control/32600</References>
</References>
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