An Analysis of the Factors Influencing the Adoption of Activity Based Costing (ABC) in the Financial Sector in Jamaica
Keywords:activity based costing, logistic regression, financial sector, cost management
AbstractFinancial institutions are increasingly operating in a highly competitively environment and therefore cost management has become an imperative. This paper investigates the factors influencing the adoption of activity-based costing (ABC) methodology within the financial sector in Jamaica. Quantitative analysis was done using the generalized linear logistic regression model. The results show that there are three main factors that are statistically significant in the decision to implement an ABC system, these are: companies perception of the ability of ABC to assist in cost control, the proportion of overhead to total cost and finally, the action of competitors, that is, whether a competitor adopts the ABC methodology
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