Role of Cost Management and Performance Measurement in Managerial Accounting

Managerial Accounting

Table of Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................2
Review of topic and review of literature..........................................................................................2
Company review and analysis.........................................................................................................7
Comparison of remuneration methods used to the research............................................................9
Conclusion.....................................................................................................................................10
Referencing....................................................................................................................................12

Executive Summary
This report emphasis on how the performance of the employees can be measures through
various different accounting tools, also the role of cost management in an organisation through
analysis of different accounting tools and methods has been done. The reader of this report
would be able to evaluate the financial and non-financial performance measures and tools so as
to reward the individual and corporate. Management control theory and concepts which apply to
organisational settings would be checked to generate the accounting and organisational reports.
This report concludes that how performance measurement measures affects the ethical behaviour
of the organisation and how the evaluation of financial and non-financial measures helps in
achieving the desirable gaols.

Introduction
Managerial accounting in other words also known as the cost accounting is a process of
measuring, identifying, interpreting and communicating the information to the managers so that
an effective decision could be taken to achieve the overall goal of the organisation. This
accounting helps the management in achieving the target of financial leverage for the company
and also helps them setting the employees remunerations by analysing the profit. The company
taken for the purpose of the study is Amaysim Australia which is the leading provider of
subscription based mobile service plans and Australia’s fourth largest mobile service provider.
This report focuses on how the concepts and tools of accounting which helps in analysing the
roles of cost and management in the organisation. Also evaluation of financial and nonfinancial
performance of the company would be checked so remuneration of the employees can be fixed.
At last the report would focus on measuring the performance and reward effort of the employees
so as to achieve the target objectives smoothly.
Review of topic and review of literature
Management accounting is the process of measuring and reporting financial performance
of the company so that it becomes easy for the company to implement the remuneration on the
basis of performance done by the employees of the organisation. It covers all fields of accounting
which is aimed at forming the management of business (Ahmed and Duellman, 2013). The
management accountants use the information that is relating to the cost of the company so that a
fixed remuneration can be set for the employees which would make the company earn maximum
profit without hampering the actual expense. Budgets are used by the company so that it
becomes easy for them to allocate the amount for operations of the business. This is also used so
that planning, performance, evaluation and operational control of management can be achieved.
Planning: it is the management process to analyse and decide as to which product to be made and
where and when it should be made (Maher and et. al., 2012). The management has to determine
the materials, labour, and various other resources that would be used to achieve the desired
output.
 Performance evaluation: it is the function of the cost manager to determine the plan with
help of the accounting tools that will fix the remuneration on the basis of performance of
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