ThAi nguyen University Southern Luzon STATE University Socialist Republic of Vietnam Republic of Philippines THE FACTORS AFFECTING THE ADOPTION OF COST ACCOUNTING SYSTEM OF SELECTED TRAVEL AGENCIES IN HANOI, VIETNAM A RESEARCH PRESENTED TO THE FACULTY OF GRADUATE SCHOOL SOUTHERN LUZON STATE UNIVERSITY LUCBAN, QUEZON, PHILIPPINES THAI NGUYEN UNIVERSITY S.R VIETNAM IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE DOCTORAL IN BUSINESS ADMINISTRATION Name of Student English Name Date of Birth Course : DOAN THI QUYNH ANH : ANGEL : 05/01/1981 : SLSU-DBA1 Hanoi November, 2013   Page 1    ACKNOWLEDGMENT During the conduct of my thesis, I would like to give my sincere thank to advisors: Prof Dr Pete Ooi; Dr Edwin Bernal The advisors help me with detailed guidance and instruction so that I can complete my research Representatives from Southern Luzon State University, ThaiNguyen University, ICT and academic affairs together with teachers and staffs in ICT office has encouraged and helped from all the members in the class When conducting the research, I receive the enthusiastic support and participation of directors and staffs of all enterprises that I have research Beside that, I always receive the encouragement and support form my family I would like to express my sincere thanks to the advisors, staffs participating in the research and my family for supporting me a lot Doan Thi Quynh Anh - Angel   Page 2    CHAPTER INTRODUCTION 1.1 Research Background As Vietnam rides in the development of world economy, its hospitality/tourism industry had gained remarkable leap Demand in a wide-range of hospitality-related products and services increased as people's living standard improved This included products and services in travel services which is one sector in the multi billion-dollar world-wide hospitality industry Products and service in a travel agency are designed to satisfy special needs of consumers such as understanding the culture, tradition and the historical treasures of one locality, appreciating natural beauty of the place, experiencing the climate, foods, events and festivities of the area, and a lot of activities simply designed for sightseeing and for rest and recreation The demand for travel products and services is not very stable as it easily changes due to instability of the climatic condition, and the economic and political situation of the particular tourism destination It therefore requires that players in the travel business to be more creative and innovative to anticipate changes in the business landscape in order to cushion the impact of slack time in the business Summarily, determining the cost of products and services in a travel agency poses a great challenge for the firm’s accountants and managers in as   Page 3    much as the business’ price offerings depend largely on the relevant costs Doubly challenging is the implementation of a firm’s policy on cost allocations because this requires a deal of rationalization so as not to overburden one product/service while others overburdened with unnecessary costs This therefore requires the identification and the use of appropriate cost driver to achieved full rationalization of the system Further, to achieve comparative and competitive advantages, it is necessary that, costs associated with the implementation of activities in major business functions along the value chains should be analyzed as to whether these are value-adding or non-value adding costs Obviously, only value adding activities are client-focused activities and therefore add to the achievement of the value expectations of the clients While cost accounting is a necessary requirement to achieve more in the travel business in Hanoi, less has been benefiting fully from it To determine the factors that drive the sector to adopt cost accounting system is the major reason why this research was conducted 1.2 Statement of the Problem This research focused on determining the factors which affect the adoption of the cost accounting system of selected travel enterprises in Hanoi Specifically, it tried to find answers to the following research questions: What is the profile of the respondents in terms of gender, age, position and field of specialization?   Page 4    What is the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system? What factors are significantly affecting the attitude of the accountants and the managers of travel agencies in adopting a cost accounting system? Is there any difference in the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system? Is there any difference between the accountants’ and the managers’ attitude towards adherence to the cost accounting system in the management of costs in travel agencies? 1.3 Statement of Objectives The general objective of this research was to determine the significant factors affecting the adoption of cost accounting system for Hanoi-based travel agencies It seek to meet the requirements of the following specific objectives: To determine the profile of the respondents in terms of gender, age, position and field of specialization To describe the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system   Page 5    To identify the factors which significantly affect the attitude of the accountants and the managers of travel agencies in adopting a cost accounting system To statistically test the difference in the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system To statistically test the difference between the accountants’ and the managers’ attitude towards adherence to the cost accounting system in the management of costs in travel agencies? 1.4 Hypotheses The following hypotheses were tested using inferential statistical tools: Hypothesis 1: There is no relationship between the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system and their attitude towards adoption of the same cost accounting system in travel agencies Hypothesis 2: There is no difference in the accountants’ and the managers’ perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system   Page 6    Hypothesis 3: There is no difference between the accountants’ and the managers’ attitude towards adherence to the cost accounting system in the management of costs in travel agencies 1.5 Significance of the study This research conduct to analyze relationship between factors affecting the cost accounting system in selected travel agencies This study will be significant to the following individuals and organizations: For travel agencies and its key officers, this research indicates help finding the key factors to apply the cost accounting system, they can use the results of this research to find the factors affecting to the adoption of cost accounting system in their enterprise Based on the results of this dissertation, managers and accountants in travels agencies can making a plan to adopt the cost accounting management in their enterprise with the target such as managial cost, , saving cost, decision making 1.6 Scope and Limitation of the Study Along with the system of the general theory of cost accounting system for internal management, the thesis will analyze and assess the current perception of cost accounting systems at some business travel company in Hanoi from which to finding the factors affecting of adoption of cost accounting sytem for travel   Page 7    agencies in the direction of modern cost accounting management system, which help the cost management and providing useful information for the decision of the administrator With the aim of improving accounting system in travel company in Hanoi, and the number of enterprises tourism in Hanoil multiple, complex components business in different fields, so the authors concentrate on research of the cost accounting system of business describe the model tour travel service in Hanoi, including: A state-owned enterprise specialized in the field of business travel, business travel in all four areas received international, send international visitors, receives domestic tourists and domestic tourists on Hanoi recent years that is Vietnam Travel and Marketing transports Company Two enterprises belong to VietNam national Administration of Tourism are the State of Investment and Tourism Thang Loi and HaNoi Tourism company Three enterprises represent non-state enterprises as AsiaLink travel joint stock Company; New Horizons travel joint stock company, SaoMai travel company Besides, the authors also conducted to survey 25 travel companies in the area of Hanoi 1.7 Operational Definition of Terms The following terms has been operationally defined: Cost accounting system Cost   Page 8    Travel agency Level of awareness and understanding of cost accounting system Ease of use of cost accounting Usefulness of cost accounting CHAPTER II REVIEW OF RELATED LITERATURE AND STUDIES This chapter authors reviews the related literature and studies on travel industry in Vietnam in general, Hanoi travel in particular This chapter provides the reader with sufficient theory about cost accounting, the usefulness of cost accounting system It will discuss theories framework and concepture framework , which is going to be evaluated in following chapters 2.1 Review of Related Literature 2.1.1 The tourism industry and the travel sector During the 53 years of establishment and development, travel industry has always been interested in each period are determined location of tourism in the economic development strategy of the country's socio-suit bridge revolution In 53 years of development , not a long time for the development of an industry , but can also see the strong upturn in both quantity and quality of Vietnam Tourism , is   Page 9  ... understanding, ease of use, and usefulness of cost accounting system? What factors are significantly affecting the attitude of the accountants and the managers of travel agencies in adopting a cost accounting. .. perception of their level of awareness and understanding, ease of use, and usefulness of cost accounting system and their attitude towards adoption of the same cost accounting system in travel agencies. .. to finding the factors affecting of adoption of cost accounting sytem for travel   Page 7    agencies in the direction of modern cost accounting management system, which help the cost management