The Role of Management Accounting in Creating and Sustaining a Competitive Advantage in the Banking Industry

Abstract

The main purpose of this article is to provide insights into the role of management accounting in creating and sustaining a competitive advantage especially in the banking industry. The literature reviewed and the results from an empirical study that involved a sample of forty respondents from Equity Bank found that modern management accounting provides skills and techniques that play a vital role in the planning, developing, implementing and evaluating of strategic competitive policies that result in a competitive advantage. This study was carried out at Equity Bank - Kenya, a leading commercial bank in Kenya whose rapid growth and competitiveness can be attributed to the application of innovative management accounting practices. The study found that management accounting practices provide both internal and external competitive strategies that enable business organisations to create and sustain a competitive advantage.