The Effect of Integration of Resource Consumption Accounting and Total Quality on Strategic Cost Management in Sudanese Food Industrial Companies

Abstract

Sudanese products suffer from high cost, despite their poor quality in comparison to international products which weakens their competitiveness.This was what the literature review had revealed.Hence, the problem of the study was, there is a deficiency in the traditional costing systems applied by most Sudanese industrial companies, which makes them unable to manage their costs effectively.The main aim of this study was to examine the effect of integration between the Resource Consumption Accounting and Total Quality Practices on Strategic Cost Management, accordingly, the study hypothesized a positive effect ofthe integration between resource consumption accounting and total quality practices on strategic cost management.To achieve the objectives of the study, the study adopted descriptive analytical approach. The population of this study was food industries firms operating in Khartoum – Sudan, non-probability sampling wasemployed andthe response rate was (87%) of the distributed questionnaires.The hypotheses tested by using the path analysis through using AMOS in Structural Equation Modeling. The Findings of the study indicated that the integration of resource consumption accounting and total quality practices is found to be significant in relation to strategic cost management. However Sudanese food industry companies, apply traditional systems (78.1%) which affect the confidence in accounting information, and can create tremendous problems within an organization.This study reveals there is lack of interest of the vast majority of food industry companies about costs information and managerial accounting, moreover most of them do not have a separate division of costs and they don't separate the accounting system from the cost system, and relying mainly on the financial accounting system only as an accounting information and data system.The study recommends that there is a need to develop the cost systems currently used for its inability to provide accurate information and replace them with modern systems that keep up with development and suit the Sudanese industrial environment.