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The controllability principle of performance evaluation : a comparative study of China and Hong Kong

Liu, Kin Cheung (1999) The controllability principle of performance evaluation : a comparative study of China and Hong Kong. Doctoral thesis, University of Huddersfield.

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    Abstract

    This dissertation investigates the factors that explain why managers are held
    accountable for uncontrollable items of performance. It examines, in particular, the
    influence of the various determinants of this controllability principle in China, a
    socialist economy, and compares them with those in Hong Kong, a capitalist economy.

    Previous studies in this controllability principle are either theoretically based or
    non-generalisable. They were mostly carried out in the western countries. This study
    attempts to test this principle empirically and to ascertain whether western accounting
    theories can be equally applied in the oriental areas with different socio-economic
    settings.

    Based on data collected from 71 managers in China and 57 managers in Hong
    Kong, empirical results show that variations in the treatment of uncontrollables can be
    explained by ten factors, namely, risk-averse attitude, managerial influenceability,
    environmental uncertainty, management subjectivity, information cost, performance
    observability, levels of hierarchy, firm size, divisional diversity and coordiantion need.
    Among these factors, the most influential ones in China are coordination need and
    information cost, and the most influential ones in Hong Kong are coordination need,
    divisional diversity and managerial influenceability. Comparison of the results between
    China and Hong Kong reveals that all the ten factors differ in degree and managerial
    accountability of uncontrollables was shown to be more likely in Hong Kong than in
    China.

    Contrary to the theories in the literature, this research discovers that managers
    are more likely held accountable for uncontrollables if they and/or their superiors are
    more risk-averse and coordination need is low. It was also found that managers in
    China are more ready to take risks than their Hong Kong counterparts. These findings
    indicate that certain theories of the controllability principle need to be reviewed. Risk
    attitude of the evaluator, institutional factors and divisional interdependency may exert
    significant influence on managerial practices.

    Item Type: Thesis (Doctoral)
    Additional Information: EThOS Persistent ID uk.bl.ethos.323779
    Uncontrolled Keywords: Chinese; Business enterprises; Accounting theory, Management
    Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
    H Social Sciences > HF Commerce > HF5601 Accounting
    Schools: The Business School
    Depositing User: Graham Stone
    Date Deposited: 22 Oct 2009 15:34
    Last Modified: 28 Jul 2010 19:48
    URI: http://eprints.hud.ac.uk/id/eprint/5950

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