Chapter 1

• Management Accounting involves the application of appropriate techniques and concepts to economics data so as to assist management in establish plans for reasonable economic objectives and in the making of rational decisions with a view toward achieving these objectives.
• application of appropriate technique and concept to economic data

  management accounting
• process of identification, measurement, accumulation, analysis, preparation, interpretation, and communication of financial information

  management accounting
• concerned with providing information to managers and inside the organization

  management accounting
• concerned primarily with providing information to internal manager who are charged to planning and controlling the operation

  management accounting
• data accumulation which enables both internal and external parties to evaluate organization performance

  scorekeeping
• helps the manager to focus on operating problems.- commonly associated with current planning and control

  Interpreting and report of information
• quantification of the relative merit of possible course

  problem solving
• provides a system which allows management to receive necessary information

  management accounting
• setting of goals - various ways to meet the goals

  planning
• evaluation of whether actual performance

  controlling
• determine of predictive information

  decision making
• a key activity for all companies

  planning
• the plans of management are often expressed formally

  budgets
• cash budget, capital budgets and projected sfp are example which accounting can make

  resource planning
• evaluating performance of manager and the operation

  control
• who evaluated to determined how their performance should be rewarded or punished

  managers
• cost variance analysis, financial statements analysis, gross profit variance analysis are

  accounting control reports
• the report used to evaluate the performance of manager and operations are refer to

  performance reports
• what is the manager follow principles when using performance report

  management of exception
• play the important role in the control process

  company plans
• - is an integral part of the planning and control process- made to reward or punish to managers

  Decision making
• involves the systematic recording of business transaction by a body of IFRS

  Financial reporting
• concerned with financial information to person within organization

  Management accounting
• Difference of FA and MA as to objective

  FA: provide data to internal and external

  MA: only internal
• Difference of FA and MA as to compliance with IFRS

  FA: accordance to IFRS

  MA: not using IFRS
• Difference of FA and MA as to emphasis on the future

  FA: using past financial transaction

  MA: strong future orientation
• Difference of FA and MA as to relevance and flexibility of data

  FA: historical data are prepared

  MA: special reports include both historical data and projected data are prepared
• Difference of FA and MA as to emphasis on precision and timelines of report

  FA: past activities where precision are required

  MA: timeliness is more important than to precision
• Difference of FA and MA as to reporting requirements of an organization

  FA: primarily concern to company reporting as a whole

  MA: focuses reporting on the part or segment (product line, sales territories, divisions)
• Difference of FA and MA as the requirement for compliance with law

  FA: required by law

  MA: not mandatory
• Primarily at external users

  Financial accounting
• Primarily at internal users

  Managerial accounting
• Similarities of FA and MA

  Managers use FA reports an external user to make financial information to internal users
• systematic set of procedures for recording and reporting measurement of the cost if manufacturing goods and performing services

  Cost Accounting
• Newer interest of cost accounting

  Management Accounting
• concerned with the primary operating activities - manufacturing (or buying) and selling

  Mangers of line function
• is a staff function, with management accountants

  Accounting
• What ate the management accountants responsibility?

  1. Planning

  2. Reporting

  3. Controlling

  4. Resource Management

  5. Information system development

  6. Technological Implementation

  7. Verification

  8. Administration
• involves quantifying and interpreting the effects on the organization of planned transactions and other economic events

  Planning