In a groundbreaking analysis, Prof Janek Ratnatunga, CEO of the Institute of Certified Management Accountants (ICMA) Australia and New Zealand, delves into the intricate relationship between management accounting and geopolitics, particularly in the context of modern military conflicts. This release highlights the critical insights from Prof Ratnatunga’s latest article, “The Numbers Game in the Geopolitics of Destruction.”

Prof Ratnatunga articulates how key areas of management accounting—strategic decision making, cost management, resource allocation, and supply-chain logistics—are crucial in understanding and navigating the volatile landscape of global geopolitics. He emphasizes that with the current fracturing of the global rules-based order, countries and entities are increasingly leveraging geographical entities for political gains.

The ongoing conflict involving the United States, Israel, and Iran serves as a poignant example. Prof Ratnatunga highlights the economic burden imposed by Iran’s use of low-cost drones against sophisticated U.S. defence systems. “Iran’s low-cost attack drones are creating an unsustainable financial strain on the U.S. and its allies,” states Prof Ratnatunga. “While these drones are cheap to produce, shooting them down costs millions, turning a ‘low-cost’ war into a massive economic burden.”

The article underscores the need for modern military forces to integrate management accounting into their strategic frameworks. It raises questions about the requirements of a 21st-century military, focusing on distributed production, supply-chain logistics, target costing, and pricing.

Prof Ratnatunga discusses the emergence of affordable cruise missiles and drones, driven by technological advancements in production methods. This shift has enabled entities like Iran to leverage cost-effective means to achieve strategic military objectives, altering the traditional balance of power.

In conclusion, Prof Ratnatunga calls for military strategists to collaborate with management accountants, utilizing tools such as game theory to navigate the complex scenarios presented by modern warfare. “In regions like the Middle East, Europe, and the Pacific, the convergence of technologies and distributed production

Released by: The Institute of Certified Management Accountants (Australia and New Zealand)

Date: 8 March 2026

Location: Melbourne, Australia