History of Management Accounting and New Insight of Islamic Balanced Scorecard

Abstract

This paper describes the history of management accounting from the ancient era, the medieval era to the era of predictive analysis. The modern accounting and cost management system that we know today is a product of a previously implemented system because of the close relationship between the current system and the previous system. This study uses a qualitative approach because it describes the history and development of management accounting, the relevance of management accounting, and provides new insights on the Islamic BSC concept. The findings of this study reveal that current management accounting practices such as just-in-time, target costing, activity-based costing, value-added management, and zero-based budgeting are no longer able to serve increasingly complex managerial needs. The development of management accounting is currently strongly influenced by the rapid development of information technology, including artificial intelligence and blockchain. This article also describes new insights regarding the concept of the balanced scorecard in an Islamic perspective based on four basic principles, namely brotherhood (ukhuwah), justice ('adalah), benefit (maslahah), and balance (tawazun).