Course objective and motivation
The course considers the use of accounting information for incentive purposes and performance evaluation in hierarchies. We will study seminal papers on incentives, performance measurement, and how incentives and performance measurement affect the assignment of authority in hierarchies. The objectives of this course include:
- To introduce students to the theoretical foundations of the decision-influencing role of accounting information.
- To introduce students to structuring and solving choice problems related to incentives and performance measurement.
- To facilitate the application or development of theory for research projects in accounting.
Each topic will have a set of required readings. We will tackle each topic using a combination of lectures, exercises, and discussions. We will begin with a lecture to introduce the topic, characterize the choice problem, and ways to formally structure the problem. Then, students will work on simple exercises to apply the theory and present their results. Finally, students will work on operationalizing the conceptual variables and suggest ways to test the results. We will close with a discussion of unresolved issues.
Course program
Day 1: Incentives: e.g. finite resp. convex action and outcome space
Day 2: Incentives: e.g. agent limited liability; linear contracts
Day 3: Performance measurement: e.g., controllability principle; aggregation
Day 4: Performance measurement: e.g., congruity; relative performance evaluation
Day 5: Hierarchies: e.g., performance measure spillovers; collusion
Course instructor
Professor Christian Hofmann is a Professor of Accounting and Control at LMU Munich School of Management. He is a principal investigator at the TRR266 Accounting for Transparency project. His research interests are in performance evaluation and incentives. Professor Hofmann is currently an editor at European Accounting Review and Journal of Business Economics. Professor Hofmann has published his research in The Accounting Review, Contemporary Accounting Research, Review of Accounting Studies, and Journal of Management Accounting Research, among others. His textbook on Cost Accounting (together with Gunther Friedl and Burkhard Pedell) appeared in 2022 in its fourth edition (in German) as well as a first edition in English.
Practical information
Venue:
University of Amsterdam, Faculty of Economics and Business, Section Accounting
Included:
- Course materials (digital)
- Coffee and tea
- Certificate (6 ECTS)
Certification
Upon successful completion of the course you will receive a certificate worth 6 ECTS (European Credits).