How to Analyze the Practical Relevance of Costing Methods? The Example of Hospital Cost Accounting in France

Analyses of the practical relevance of costing methods are based on a narrow range of evaluative factors, progressively distancing themselves from the technical essence of these methods. This article examines how a better understanding of the foundational technical underpinnings can enrich the analysis of the practical relevance of a costing method. To do this, we draw on interventionist research in a French cancer centre, where the costing method, prescribed and transposed from private management methods, is widely criticized by its users and rarely analyzed in‐depth. From a theoretical point of view, the results of this article propose a model for analyzing the practical relevance of a costing method. By progressively modifying the calculation techniques of this costing method, the application of this model to the costing method studied highlights four criteria for the technical analysis of the practical relevance of this method, two of which have already been identified in the literature (cost traceability and causality), and two of which have not yet been identified (exhaustiveness of cost centres and cost/value articulation). These four criteria represent the characteristics of this method by which any change in its calculation technique also modifies its practical relevance. From a methodological point of view, this article also shows how a better knowledge of the elements of practical relevance of a costing method can facilitate the success of interventionist research in management accounting. To this end, we propose a three‐step interventionist research approach for analyzing the practical relevance of a costing method.