This paper is structured as follows. In the following section, the advantages that SEM may hold as a statistical method are demonstrated. Some limitations of multiple regression and path analysis that may curb their suitability for many types of management accounting research are considered. This is
followed by a review of published management accounting research that utilizes SEM. This survey examines the areas in which some management accounting research has failed to consider key principles relating to the use of SEM. It also examines the type of research problems where SEM has been used. In the final section, conclusions and suggestions for improving the application of SEM in management accounting research are presented, and the potential for SEM to advance the literature in management accounting is assessed.