Developing a strategic management accounting model for evaluating public sector organizations

In recent years, public sector organizations have faced increasing pressures from limited budgets, rising public expectations, and demands for transparency and accountability. Strategic Management Accounting (SMA) has evolved from a traditional cost-tracking tool into a strategic enabler of long-term performance. This study develops and validates a comprehensive SMA model tailored to Iran's public sector context using a sequential mixed-methods approach. The qualitative phase involved semi-structured interviews with 12 senior financial managers and policy advisors from Tehran Province public agencies, combined with systematic content analysis of 28 credible sources, identifying five core SMA dimensions: strategic information use, comparative and competitive analysis, alignment of financial and strategic objectives, application of strategic tools (e.g., BSC, ABC), and financial transparency/accountability. These dimensions were operationalized and used to develop a questionnaire that was distributed to 276 financial managers via proportional stratified sampling. Quantitative analysis using EFA, Pearson correlation, and SEM in SmartPLS 4 confirmed all five dimensions positively and significantly influence financial performance, with alignment of financial and strategic objectives as the strongest predictor (β = 0.39, p < 0.001). The study presents a context-sensitive, evidence-based SMA model as a practical framework for public sector leaders.