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Using transaction cost economics to explain outsourcing of accounting

Patricia Everaert UGent, Gerrit Sarens and Jan Rommel (2010) SMALL BUSINESS ECONOMICS. 35(1). p.93-112
abstract
This study explores whether SMEs involved in the outsourcing of accounting tasks differ, in terms of transactional and personal (CEO) characteristics, from others that perform the same tasks within the company. We rely on the transaction cost economics (TCE) model, while controlling for age, educational background, and trust of the SME executive in the external accountant. A survey was developed to investigate the outsourcing by Belgian SMEs both of routine (entry of invoices, interim reporting) and non-routine (period-end accounting, preparation of financial statements) accounting tasks. For the routine accounting tasks, frequency was significantly associated with outsourcing. Meanwhile, for non-routine accounting tasks, asset specificity and frequency were significantly associated. High-frequency tasks were associated with lower levels of outsourcing. Similarly, higher asset specificity was associated with lower levels of outsourcing. Furthermore, the educational background of the CEO, as well as the CEO's level of trust in the external accountant, was significantly associated with outsourcing, confirming the upper echelon theory. Having a more educated CEO was associated with lower levels of outsourcing, both for routine and non-routine accounting tasks.
Please use this url to cite or link to this publication:
author
organization
year
type
journalArticle (original)
publication status
published
subject
keyword
ENTRY-MODE CHOICE, VERTICAL INTEGRATION, OR-BUY DECISIONS, SMALL FIRMS, UNITED-STATES, TRUST, PERFORMANCE, INDUSTRY, ORGANIZATION, PERSPECTIVE, Accounting, SME, Transaction cost economics, Outsourcing
journal title
SMALL BUSINESS ECONOMICS
Small Bus. Econ.
volume
35
issue
1
pages
93 - 112
Web of Science type
Article
Web of Science id
000279036400006
JCR category
ECONOMICS
JCR impact factor
1.555 (2010)
JCR rank
63/301 (2010)
JCR quartile
1 (2010)
ISSN
0921-898X
DOI
10.1007/s11187-008-9149-3
language
English
UGent publication?
yes
classification
A1
copyright statement
I have transferred the copyright for this publication to the publisher
id
697146
handle
http://hdl.handle.net/1854/LU-697146
date created
2009-06-14 15:04:12
date last changed
2012-04-25 15:56:30
@article{697146,
  abstract     = {This study explores whether SMEs involved in the outsourcing of accounting tasks differ, in terms of transactional and personal (CEO) characteristics, from others that perform the same tasks within the company. We rely on the transaction cost economics (TCE) model, while controlling for age, educational background, and trust of the SME executive in the external accountant. A survey was developed to investigate the outsourcing by Belgian SMEs both of routine (entry of invoices, interim reporting) and non-routine (period-end accounting, preparation of financial statements) accounting tasks. For the routine accounting tasks, frequency was significantly associated with outsourcing. Meanwhile, for non-routine accounting tasks, asset specificity and frequency were significantly associated. High-frequency tasks were associated with lower levels of outsourcing. Similarly, higher asset specificity was associated with lower levels of outsourcing. Furthermore, the educational background of the CEO, as well as the CEO's level of trust in the external accountant, was significantly associated with outsourcing, confirming the upper echelon theory. Having a more educated CEO was associated with lower levels of outsourcing, both for routine and non-routine accounting tasks.},
  author       = {Everaert, Patricia and Sarens, Gerrit and Rommel, Jan},
  issn         = {0921-898X},
  journal      = {SMALL BUSINESS ECONOMICS},
  keyword      = {ENTRY-MODE CHOICE,VERTICAL INTEGRATION,OR-BUY DECISIONS,SMALL FIRMS,UNITED-STATES,TRUST,PERFORMANCE,INDUSTRY,ORGANIZATION,PERSPECTIVE,Accounting,SME,Transaction cost economics,Outsourcing},
  language     = {eng},
  number       = {1},
  pages        = {93--112},
  title        = {Using transaction cost economics to explain outsourcing of accounting},
  url          = {http://dx.doi.org/10.1007/s11187-008-9149-3},
  volume       = {35},
  year         = {2010},
}

Chicago
Everaert, Patricia, Gerrit Sarens, and Jan Rommel. 2010. “Using Transaction Cost Economics to Explain Outsourcing of Accounting.” Small Business Economics 35 (1): 93–112.
APA
Everaert, P., Sarens, G., & Rommel, J. (2010). Using transaction cost economics to explain outsourcing of accounting. SMALL BUSINESS ECONOMICS, 35(1), 93–112.
Vancouver
1.
Everaert P, Sarens G, Rommel J. Using transaction cost economics to explain outsourcing of accounting. SMALL BUSINESS ECONOMICS. 2010;35(1):93–112.
MLA
Everaert, Patricia, Gerrit Sarens, and Jan Rommel. “Using Transaction Cost Economics to Explain Outsourcing of Accounting.” SMALL BUSINESS ECONOMICS 35.1 (2010): 93–112. Print.