| This study investigates the use of competitors' accounting information by individuals engaged in competitive intelligence activities. Accounting information use refers to the collection or estimation of competitors' cost information and, when available, the use of competitors' published financial information. Field research helped develop theory and aid development of a survey instrument. The field research was followed by a mail survey of approximately 1,000 individuals in the United States and Canada. A structural equations model was used to examine the relationships among key variables.; The findings of this study are that competition and skills positively influence the perceived benefits to the use of accounting information in competitive intelligence. Higher skills reduce the perceived costs to the use of accounting information. A higher level of perceived benefits leads to greater accounting information use while higher perceived costs reduces the use of accounting information. The individual's use of accounting information leads to both increased effectiveness of competitive intelligence activities and a higher involvement with accounting staff. When assessing competitor costs, higher involvement with accounting staff also leads to higher effectiveness. An important finding is that higher effectiveness was found to lead to improved organizational performance.; The results demonstrate a need for management accountants to become involved in the competitive intelligence process as the management accountant can support financial statement analysis and comparisons of competitor cost data to internal costs. Through education, accounting academics can increase awareness of how accounting information can support competitive intelligence, providing more accurate and useful information to decision-makers in the firm. Finally, the study points out that accounting information is used frequently because it is viewed as a useful, reliable and accessible information source. Accounting policymakers should be aware of the frequency and extent of use of accounting information by a firm's competitors and keep in mind that, while better disclosure may provide a limited number of investors with better information, it may ultimately hurt the firm and its investors by providing competitors with easy access to information. |
