Management accounting practices towards financial performance in manufacturing companies, Bangladesh: Mediating role of rationalized managerial decisions

The aim of this study is to analyze how management accounting practices affect the financial performance of manufacturing companies in Bangladesh, taking into account the potential influence of rationalized managerial decision-making. We collected primary data from a diverse range of manufacturing industries in Bangladesh. We conducted mediation analysis to measure the direct and indirect effects among the variables, using Rationalized Managerial Decision (RMD) as the mediator variable. We considered the Management Accounting Practices (MAPs) as independent variables and the Financial Performance (FP) of the selective manufacturing industries in Bangladesh as the dependent variable. The results indicate a positive relationship between the MAPs and FP, with an increase in MAPs leading to a rise in FP. The relationship between MAPs and RDM is positive; an increase in MAPs leads to a rise in RDM. The overall impact of RMD on FP is positive, one percent increase on RDM tends to raise FP 0.25 %. When considering the mediating variable RDM, it is evident that MAPs have a positive impact on FP, and this mediation effect is statistically significant. This study has contributed valuable insights into the impact of management accounting methods on financial performance. It specifically focuses on the role of rationalized managerial decision-making as a mediator.