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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 : DOAN THI QUYNH ANH
English Name : ANGEL
Date of Birth : 05/01/1981


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CHAPTER 1
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
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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

5. 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:
1. To determine the profile of the respondents in terms of gender, age,
position and field of specialization.
2. To describe the accountants’ and the managers’ perception of their level of
awareness and understanding, ease of use, and usefulness of cost accounting
system.
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3. To identify the factors which significantly affect the attitude of the
accountants and the managers of travel agencies in adopting a cost accounting
system.
4. 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.
5. 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

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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 7 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
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Travel agency
Level of awareness and understanding of cost accounting system
Ease of use of cost accounting
Usefulness of cost accounting

country is estimated at 13,500 to 285,000 chamber, in which: 57 hotels 5 star 147
hotels 4 star,335 hotels 3 star.
Vietnam Tourism to identify some key tasks in 2013 include : Continue to
implement the development strategy of Vietnam's tourism in 2020, with a vision
to 2030, deployment of the planning scheme, other resorts according to the master
plan on development of Vietnam Tourism 2020 vision 2030 after being approved
by continued deployment tasks improve the quality and efficiency of tourism
statistics; promote activities E - tourism marketing and branding Vietnam tourism
logo and slogan associated with the new deployment scheme to attract tourists
from 8 key tourism markets of China , Japan , Korea , Malaysia , Thailand ,
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Australia , France , Russia , to exploit tourism development Ha Long Bay and a
number of other prominent points to ensure the sustainability and high economic
efficiency, image building heritage tourism Vietnam, Ha Long Bay
2.1.2. Travel business in Hanoi
Hanoi is located and beautiful location, conveniently, is the capital, the
center of politics, economy, culture scientific, and important traffic of the country.
As one of the largest tourist centers of the country, Hanoi plays a very important
role in the tourism development of the country in general and in particular of
Tonkin. International tourist arrivals to Hanoi for about 30 % of visitors to
Vietnam. With the advantage of historical, cultural capital , domestic tourists to
Hanoi at the forefront of the country. Hanoi is also a center for receiving and
distribution of tourists travel to the northern region and the other regions in the
territory of Vietnam as well as to countries in the region .
Since several years , Hanoi has always been a number of prestigious travel
magazine as the World 's leading Travel and Leisure ( U.S. ) , Smart Travel Asia (
HKG ) held a vote and won the title of Top 10 tourist destinations most of Asia.


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performing arts theater folk as rowing, water puppetry very attractive with
international travelers and domestic .
2.1.3. Accounting as the language of business
Traditionally, accounting has been defined as the process of recording,
classifying and reporting the fianancial activities and transactions of a business
enterprise. The process of recording and classifying business transactions is
commonly referred to as bookeeping. The bookkeeping function of accounting
skill forms the foundation of much accounting activity. An accountant is usually
defined as “one who is skilled in accounting”. Ta the beginning of the twentieth
century, however, the role of accountantdid not extend much beyond a
bookkeeping function, that is, the keeping od records according to a set of well-
defined rules and procedures. At this time, accountants were generally reffered to
as “bookkeeper”. In the bissiness world of the twenty-first century the activities
and responsibilities af accountants extend far beyond mere bookeeping and the
keeping records. They include the interpretation and analysis of accounting report,
the design and operation of computer based system, the planning and conduct of
business activities, and the understanding the complex accounting regualtions that
have accumulated over many years.
Accountants serve a potentially wide variety of user groups. The many
different users of accounting informarion include the owners or shareholders of a
business entity, the people who have lend money to the entity, the entitys’
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employees, government agencies and other social and political interrest group,
such as environment group anf trade unions. In providing information for these

accounting information, but first we are concentrating on its use by managers to
make decisions.
Unlike the accounting systems that help in the preparation of financial
report periodically, the cost accounting systems and reports are not subject to rules
and standards like the . As a result, there is wide variety in the cost accounting
systems of the different companies and sometimes even in different parts of the
same company or organization.
A method of accounting in which all costs incurred in carrying out
an activity or accomplishing a purpose are collected, classified, and recorded.
This data is then summarized and analyzed to arrive at a selling price, or to
determine where savings are possible.In contrast to financial accounting (which
considers money as the measure of economic performance) cost accounting
considers money as the economic factor of production.
Cost accounting is an approach to evaluating the overall costs that are
associated with conducting business. Generally based on standard accounting
practices, it is one of the tools that managers utilize to determine what type and
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how much expenses is involved with maintaining the current business model. At
the same time, the principles of cost accounting can also be utilized to project
changes to these costs in the event that specific changes are implemented.
2.1.5. Cost management in travel agency
The implementation of a cost accounting system is an important step for a
service business. Implementation begins with identification of the correct costing
system for the business, moves on to deployment of the system and finishes with
post-deployment support to train employees on how to use the system effectively.
Best practices in cost-system implementation focus on all three parts of the
implementation process.

system. The money that you spend seeking professional help can buy you time to
focus on business operations. However, service business owners who seek
consultants should be mindful and ask the consultants if they receive any
commission from the makers of the cost accounting system. If so, you may wish
to seek the advice of someone more impartial.
2.2. Related Studies
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Behavior costs means that these costs will change how business activity
levels change. This classification needs planning, cost control and actively
regulate the cost of management. According to this classification, the entire cost
of the enterprise are classified into:
Variable costs: Are the expenses related proportional to the level of activity,
variable costs for one unit of product is stable does not change, the total variable
costs change when output changes and variable cost is zero when inactive.
- The fixed cost: The cost does not change when the level of activity changes (to
the extent appropriate), but when 1 unit based, the costs vary inversely with the
level of activity . However, when the level of development activities beyond the
scope of compliance, cost forced to change to fit in with the development of the
activity level. Usually the fees include: equipment depreciation costs, advertising
costs, rent, insurance.
- Mixed Cost: Is the cost of which itself includes variable costs and fixed fee
element. In particular, the charges reflect the cost basis, at least to maintain the
service and to keep the service always ready to serve the state. While the variable
costs reflect the actual service or in excess of the base rate so this section will vary
proportionally with the level of use on the baseline
The focus of management accounting is the field of cost, so the organization of
scientific management accounting and reasonable will ensure information quality,

building cost estimates associated with the business of governance, facility
conditions promote positive, proactive, innovative facilities and the feasibility of
the estimates were made, at the same time facilitate strengthen inspection and
control.
Business processes of the enterprise consists of many processes are closely related
to each other. Each different process management requirements also vary,
requiring specific target estimate to suit each specific business process. In the
enterprise business system production estimates include many targets, but
estimates of consumption is a major factor affecting the entire line estimation of
the business, its impact and driven to the other estimates. Consumption estimates
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as the basis for estimation of production or purchase to meet the demand for the
production or sale of products. Based on production estimates for estimation of
production costs which determine the estimates defined business results.
Therefore, in the estimation process to determine the basic estimates as a basis
from which to build a system estimates the scientific production estimates,
reasonable, feasible basis for organizations operating business activities to achieve
the highest efficiency.
There are two methods of estimation of business is flexible static estimates and
estimates. the cost estimates for a proposed activity level, and estimate flexible
cost estimates for a level of activity can occur. Data from static estimates are
important in planning but has little effect on the control because the actual level of
activity rarely coincides with the plan. In contrast, the estimated useful flexibility
for administrators to control activities by comparing the actual results and
estimates data for the same level of activity.
2.4. Conceptual Framework
From the theories and concept above, I suggest the relation of variables to

Cost Accounting System Adoption Factors
Respondents’ Profile

¾ Gender
¾ Age
¾ Position
¾ Field of Specialization

Accountants’ & Managers’
Perception on Cost Accounting
System

¾ Perceived level of
awareness &
understanding
¾ Perceived ease of use
¾ Perceived usefulness

Accountants’ & Managers’ Attitude
Toward Adoption of Cost
Accounting System
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CHAPTER III
METHODOLOGY
The research used both quantitative and qualitative methods to answer the
enumerated research questions. Survey questionnaires were designed to analyze
the factors affecting the adoption the cost accounting system in travel agencies

+

where n = A sample size
M = Population size
e = Probability of error committed due to the use of sample instead of
population.
The error level in sample survey was chosen to be at 5%.
Thus, the sample size of the survey is 150 respondents.
3.3 Research instrument
To measure the factors that affect customer loyalty in mobile
communication services, the questionnaire using the Likert scale with five levels:
5: strongly agree; 4: agree; 3: normal; 2: disagree and 1: strongly disagree.
The questionnaire was designed in four parts:
Part one: Perceived Level of Awareness and Understanding of Cost Accounting System
Part two: Perceived Ease of Use of Cost Accounting System
Part three: Perceived Usefulness of Cost Accounting System
Part four: Attitude Toward Adherence to Cost Accounting System inCost Management