Management accounting practices and performance of commercial banks in nepal

Abstract

Management accounting practices (MAPs) play a crucial role in enhancing organizational performance by providing relevant financial and non-financial information to aid in decision- making, budgeting, cost management, and performance evaluation. This study investigates the adoption of MAPs in Nepalese commercial banks and their impact on operational efficiency and profitability. The research employs a descriptive and causal-comparative design, utilizing primary data collected through structured questionnaires from commercial bank employees. Key variables examined include costing systems, budgeting systems, controlling and reporting mechanisms, decision-making processes, and performance evaluation systems. Findings indicate that MAPs significantly influence financial performance, customer satisfaction, and organizational efficiency. Despite their benefits, challenges such as lack of awareness, regulatory constraints, and financial limitations hinder effective implementation. The study highlights the necessity for Nepalese commercial banks to enhance their management accounting systems to improve financial stability, strategic decision-making, and competitive advantage. The research contributes to the existing literature by providing insights into the role of MAPs in a developing economy and offering recommendations for optimizing accounting practices in the banking sector.

Keywords: Management Accounting Practices (MAPs), Costing System, Budgeting, Decision- Making, Performance Evaluation, Financial Performance, Commercial Banks, Nepal, Organizational Efficiency, Strategic Planning.