Trends and Future Directions in Management Accounting

This assignment examines recent themes and future directions in management accounting research. It requires an analysis of various scholarly sources, including journal articles and books, to identify key trends and insights. The focus is on understanding the evolving landscape of management accounting and its implications for practice.

MANAGEMENT
ACCOUNTING

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Management Accounting and its different types...............................................................3
P2 Different Method used for management accounting report..............................................5
M1...........................................................................................................................................7
D1...........................................................................................................................................7
TASK 2............................................................................................................................................7
P3 Calculation of cost with absorption and marginal costing method...................................7
M2...........................................................................................................................................9
D2...........................................................................................................................................9
TASK 3............................................................................................................................................9
P4 Benefits and limitation of planning tools..........................................................................9
M3.........................................................................................................................................11
D3.........................................................................................................................................12
TASK 4..........................................................................................................................................12
P5 Different measures which help in resolving the financial problems...............................12
M4 ........................................................................................................................................12
CONCLUSION .............................................................................................................................13
REFERENCES..............................................................................................................................14

From: Management Accounting.
To: Director of Finance
Subject: Management Accounting information which is very much needed
INTRODUCTION
In every sector, management accounting is that which is required to be prepared with the
use of statistical data for making an proper decision and strategies in firm by the managing
directors and also has to made day to day transaction in better way and also lead to managerial
transaction too (Vasile and Man, 2012). Basically, the entity are those who uses the advanced
technology in great manner which do help in developing the solutions for revamping in business
in effective way too. Split and sort of finance in different department can also have an reduction
of wastages in better way as well. The report is based on AnswerLabs, which is a small company
and provide fitness training to millions of people.
Report will discuss about, various management accounting system which is required in
firm and will also be explained. It is such which will include the several method of management
accounting. Basically, report will also talk about advantages and disadvantages of different type
of planning tools which is considered as help in budgetary control and it also leads with
contribution of accounting system with problems occur in finance department and be solved in
proper way.
TASK 1
P1 Management Accounting and its different types.
Management Accounting: Management Accounting is such which do help in
preparation of the P&L Account, Balance Sheet and Cash Flow Structure Etc. even these all are
prepared with the help of different costing method in better way. Therefore, having an proper
account can also help in having an proper information and data that can be helped in having an
various activities of firm. Basically, all these type of scenario does help Answer Lab to gather
information related to their position in market, so that they can produce an better strategies and
decision that will be eventually make firm to have an proper working in great way. Moreover,
management accounting is such which do provide an information to the entity as sales,
inventory, cash and also raw materials as well etc (Albelda, 2011). Even though this kind of

scenario does help in having an financial and non-financial data and also needs to convert the
day to day task and activities in great manner. Normally, main aspect i.e. management
accounting is such which do help in having an revamp position for various thing like
performance, budget and having an position in market although they can expand there business
activities too in perfect way (Van der Stede, 2011). Hence, it is such which do help in three areas
enterprises and they are as:
 Strategic management: It is particular that area which do include the strategy which is
required and also leads to have an different factors which is merely associated with
different functions in great way. Basically, financial and non-financial data and
information is that which also leads to have an preparation of different budget and having
an standard for finding out some of the issues that arise out of it.
 Risk management: In this scenario, information and data is such which do mainly help
in having an identification of different thing also manages risk in great way and leads as
association with the different functions of firm in great way. For instance, inventory
management is like which do help in analysing the stock and also help in having
continuous resources, and it is be like according to demand and having an level of
production too (Arroyo, 2012).
 Performance management: Management Accounting, is also having an information and
having an contribution which do help in appraising of performance of employees in better
way and even they do also attain the solution in perfect way as well. Basically, it also
help in developing the skills and the abilities as well that has different task with there
functions too.
Even though, some of those management accounting system that is prepared by the AnswerLab
for having an proper working in organization and some of those are as:
Managerial Accounting: Moreover, it is such which do help managers in making
decisions that is related to various activities in firm. This generally helps in producing an plan,
control also manages some of the major important decisions as well that do make have an
revamping with operation department that lastly contribute in the achievement of having an
desired outcome too (Vasile and Man, 2012).
Cost accounting system: It is such which does help in controlling the different cost
which do occur and incur on performance with the different functions of the firm. Basically, it is

such which also lead to determine the profitability, inventory valuation etc. Moreover, they have
undertaken different things in great way so that system is such which is being utilised in right
context and in better way (Becker, Messner and Schäffer, 2010).
Inventory Accounting: Inventory Accounting, normally leads to have an information
related to the inventory side in the firm. Moreover, it can be said that it also help to determine the
stock in great way so that demand and needs of customer are also can be satisfied in right manner
as well. It does tell company to have information regarding inflow and outflow of raw materials
too so that effective production can be there in organization.
Job Costing: Basically, methods of accounting is such which also have an identification
of the cost which does incur due to generating jobs in enterprise and even earning huge amount
of revenue in an effective way too. Even though, for this there is a requirement of various needs
and also looks to have an assign of different jobs and also gather some of the information related
to the expenses and revenues of same (Van der Meer-Kooistra and Vosselman, 2012).
Hence, management Accounting can also help firm to have an evaluation of there finance in
proper way so that proper working needs to be seen with having an earning of different revenues
can be earned by AnswerLab.
P2 Different Method used for management accounting report.
For the organization, there are various method for having an account reporting in
different context. Basically it does help in collecting effective information which can be useful
for the small company and can convert firm to have an proper working. Different method of
reporting is being used by the AnswerLabs in having an preparation of various reports too. Even
though a report is such which do include the Budget, Job Cost and Inventory with
manufacturing. There is an importance of managerial reporting as it does provide an financial
and non-financial data related to different department of company and it does help in monitoring
the performances of entity and make top executives of enterprise to make an effective decisions
and strategies too.
Here are some of the account reporting methods which is used by the company are as:
Budget report: It is such which tell in having an preparation of budget of firm which do
include the expenses which is being incur by earlier years as well. Normally, Budget is that
which do help management of AnswerLab in having an execution of the performances for
several department of entity too. Generally, various budget are those who also control and

manage risk in proper way which also lead to provide an appropriate solution to them even in
better way (Vakalfotis, Ballantine and Wall, 2013.). Therefore, it is such which also include
different benefits to employees according to the performances. Budget is such which do control
the extra expenses which does lead to process of different thing and also lead to have an
reduction of the operational cost that convert company to attain the desired goals and objectives
in various ways.
Inventory report: It is such which also include the report of having an inventory and
also has an production of the AnswerLab firm in effective way. Normally report is such which
do help the management of raw material and leads to help in finished goods. Moreover, it is such
which also lead to have an preparation of product and it is be according to market demand as
well, even though it is such which also has an different resources in effective way in right
context. Report is such which do include the wastages of different cost and also overhead cost
etc. In inventory system, there are various stocks which can be generated as upper and lower
stock and with the company and even though they do have an different techniques which lead to
have an proper maintenance of inventory as well (Bennett, Schaltegger and Zvezdov, 2013).
Job costing system: Basically, report is such which is being prepared in by manager of
AnswerLab and needs to analyse various expenses that is going to be incur which do have an
implementation of project as well. Even though, it also help in having an match of different
things and expenses which is having an expected revenue as well. Moreover, some of the thing
which is considered as the opportunity regarding to evaluation of profit with project and it is
such which will going to be started by the company and needs to be accomplished of there target
too. Generally, it is be like that do help in generating the large number of profit in right context.
Basically, it is such which do help in contribution of some of the cost and its time of firm as well
which do help in reduction of operations and its areas which result into having some worth
(Suomala, Lyly-Yrjänäinen and Lukka,2014).
Account receivable report: It is such that needs to be prepared by one of the
management accounting officer and needs to maintain there debtors in right context. It is
something which is being considered as the effective tool and also can be used by firm and needs
to be managed by cash flows in right context. Report is such which do help in determining the
issues in great way which will lead to have an association with collection of the process
AnswerLab. It is such which also make them to have keeping in mind about the other number of

debtors which needs to create the proper and having an policies related to such only in right
context too.
Hence, these reporting system is such which needs to be done in better manner. These
different reporting system also make company to have a great working in organization a proper
information of financial and non-financial activities does help firm to attain its goals and
objectives in perfect and accurate way too (Bodie,2013).
M1
Even though there are some of the benefits which needs to derive the management of
AnswerLab with the adoption of management Accounting system. Basically these system are
such which do provide the information in various ways and also leads to enhance decision
making and help in preparing strategies and policies in right context as result as well. There are
some of the benefits are there as (reduces cost, business decisions etc.)
D1
Management accounting is such which has an great interrelation with different
department and having an great contribution in success of the AnswerLab. Even they do also use
the method and having an reporting system is such which has work even it also leads to have an
proper direction in employees that leads to have completion in task even having an having an
satisfaction of customer needs.
TASK 2
P3 Calculation of cost with absorption and marginal costing method.
It is such which include the financial document of various company and also lead to
manage the reporting system and concept which do tell them about company and they also help
in managing various reporting criteria and even though it also considered as important criteria for
AnswerLab company. Basically, having an summary of the different thing like expenses and
revenues as well which do include different course of organization that also include the operating
and non-operating task too (Boyns and Edwards, 2013). Even though they are being used to
calculate some of the profit and losses scenario in particular and even in specific year. Different
method is there which has helped in having an statement and it also follow this:
Cost: It is such which is considered as investment of the some amount of money in there
production process and having an quality product and services for the different customers as

well. This is that which determine cost and also lead to incur at some of the stages in production
process which do sell quantity product to there ultimate customers in an effective way (Ward,
2012).
Marginal costing: This is considered as investment in production process in there extra
unit of there product with there variable resources in right context. Moreover, it is be like as
having an calculation of using marginal cost and also leads to have an variable cost which is
taken by into account and it is such which do excludes some of the fixed cost. It is such which is
used by the small company as this help firm to earn higher income and profitability in great
manner as well (DRURY, 2013).
Absorption costing: It is such which has an different method for having an purposes of
calculation with actual cost of product, both variable and fixed cost into account. Normally,
adding cost is such which is fixed and having an cost with profitability even though they also
look forward to compare different thing with the marginal costing and method as well.
Calculation through marginal costing using
Income statements
Particulars Amount
Sales 35*500 17500
Less:
Production cost 6+5+2 - 7800
Closing stock: 100*13 - 1300 -6500
Contribution 11000
Less:
Variable sales overhead 500*1 500
Fixed overhead -1800
Selling and administrative cost expenses (800+400) -1200 -3500
Total Profit / Loss 7500
Computation of Net profit by using absorption costing
Income statements

Particulars Amount
Sales 35*500 17500
Less:
Production cost 6+5+2+3 = 16*500
8000 8000
Gross profit 9500
Less:
Variable sales overhead 500*1 500
Selling and administrative cost expenses (800+400) 1200 -1700
Total Profit / Loss 7800
Basically, after producing and income statement of the company, it was required by firm
to gather information as which costing method is better in comparison to each other (Parker,
2012).
M2.
Generally, various management accounting technique is such which also lead to apply
different functions in effective way. Moreover, they have an new and various technique which
needs to be done in proper way which help in earning higher profit for some form of AnswerLab
and some of are as:
 Evaluation of financial statement.
 Standard costing.
 Financial planning.
D2
Generally, there are various financial report is be like having an preparation of
accounting officer, even though they need to have an own interpretation of financial information
with the effective decision in regard to important factor as well. As in above calculation there is a
gap in between the profit of absorption and marginal cost of 300 as because the absorption cost
does not include fixed cost and marginal cost do use the fixed cost in right context as well.

TASK 3
P4 Benefits and limitation of planning tools.
Budget: It is such which is being prepared on the basis of the expenses and cost which is
required to lead to incur in future production process in effective manner as well. Basically, it is
such which has an motive of avoiding the shortage of funds in right manner and number as well
and also leads to perform some of the activities without having an interruption. Normally, it was
like having an needs which needs to be prepared for having an managing different business
activities in effective manner (Harris and Durden, 2012).
Budgetary control: Management of the firm is that which implement the budget control
techniques in great manner and also lead to have an direct and guide members of organization in
which they utilise the different resources also having an optimum resources in effective manner.
Even though, it was like having an allocation of resources in various different department in
which they can get some of the positive outcome. Moreover, organization needs to perform the
business activities which also face the shortage of funds in great way (Otley and Emmanuel,
2013).
Process of budgetary control:
Discuss with managers: It is like having an consideration of marketing budget
techniques which also manages different thing and in which various thing needs to be discussed
with having an other member of firm in which they can formulate the effective strategy and it is
quite related to the cost and also has to incur in with future operation in effective way.
Record performances: Strategy and decision is such which needs to have an manager
where it is required to analyse the different part and having an performance which is according to
prepare the budget and also leads to perform further with business operation in an effective way.
Comparison of actual planned: Basically, budgetary control is like having an required
to compare with having an actual performance with having an desired one which needs to
include the cost and budget sales in great way.
Forecasting tools: Even though various tools are there in which manager will also
forecast some other business trend and they will also make it incur in competitive market as
demand, prices and having labour too etc. Moreover, manager is such which do lead to conduct
research and also having an possibilities that can help them to attain the goals and objectives in
great way. Basically, it is like having an forecasting manager which do motivate the employees

so that somewhere they can face up the challenges and fulfil all the taste and preferences as well
with the advanced technologies as well in great manner (Herzig and et. al. 2012).
 Advantages: It is such which leads to have an manager that needs to get prepare with
challenges while implementing the effective strategies.
 Disadvantages: Basically, they have an assumption, which needs to be also corrected
and having an incur losses in great way.
Scenario tools: Basically, it is such which also include organization that can help in
identifying various uncertainties and it will be having an affect with success of organization with
proper way. Even though, it is quite required that it needs to evaluate the uncertainties that
having an affect with business operation that having an work according to that implement the
corrective measures which protect the business activities too (Macintosh and Quattrone, 2010).
 Advantages: Managing risk is such which needs to have an development of effective
contingency and plan strategies that also needs to order to achieve the desired target in
great manner (Kihn, 2010).
 Disadvantages: Moreover, having an quality of data which is being collected with the
reliability of the model and also leads in quality poor chances with positive outcome will
be more in right context too.
Contingency planning tool: Business environment is considered as an complex and also
having an contingent nature which leads to somewhere required for the firm that leads to have an
manage of different thing and also has an monitor the business activities in right contrast through
which an implementation of effective planning is there in great way. It leads to have an
protection of organization which leads to face the many difficulties that can be occurred in
various situation as well (Lukka and Vinnari, 2014).
 Advantages: It is such which do help in managing the excessive burden which do help in
minimising the cost in right way too.
 Disadvantages: Business environment is considered as the complex in nature and also
having an managers which do find the difficulties of forecast as well.
M3.
Different planning tools are such which is available for the AnswerLab and having and
Different use of operation in great. Moreover, it is such which do help in preparing the
forecasting budget of the organization. Even though various planning tools are there which is

being used by firm and having an financial planning, cost accounting and cash flows analysis
with management reporting etc. hence, there are some tools which is used by organization in
having evaluation of market and also having an adverse effect on the operation and also lead to
prepare an various strategies and plans as well that also minimise the effect in great way too.
These tools are those which also leads to have an identification of the demand and customer in
having an satisfaction of needs as well.
D3
Various financial tools are such which do help company in solving the financial problem
in effective manner as well. Even though, it is such which do help in having an proper strategy
which do make decision for the firm and with this various criteria is there which leads to have an
earning of higher profit and having an achievement of aims and objectives in great manner.
TASK 4
P5 Different measures which help in resolving the financial problems.
There are several issues and challenges that may arise in the management which is
financial in nature hence it is required to adopt several tools and techniques to remove the
problem (Kotas, 2014). This is the responsibility of financial manager to inculcate several
innovative and effective methods that must be applied in effectual way so that that issue can be
resolved in proper time period. It is very much important to maintain significant financial
position of the company therefore AnswerLabs have taken several measures to resolve various
financial problems that are described below:
 Benchmarking: This tool helps in setting the standard performance that has to be
performed by every individual so that final outputs could be accomplished. It helps in
finding out the deviation between actual and standard performance so that corrective
actions could be taken place. It is also necessary for the AnswerLabs to examine several
strategies of their competitors and take corrective steps accordingly.
 Financial Governance: This process involve AnswerLabs to comply with all norms and
regulations that has been set by the government authority so that they do not face nay
problem in respect to it. It is mandatory for the company to follow this, otherwise non
compliance of it will results into generation of difficulties and hinder the overall
company's performance.

 KPI: Key Performance Indicator helps in measuring the performance of each and every
individual that is working in the organisation and examine any deviations that are there so
that proper steps could be taken accordingly (Lukka and Vinnari, 2014).
M4
There are number of techniques that are available with the AnswerLabs that cab be
adopted by them to minimize the financial issues faced by the management system. For instance
KPI helps the manager to evaluate the performance of every employee so that proper steps could
be taken to remove any barrier which is faced by the organisation. On the other hand,
benchmarking is also a effective way to remove the financial barrier.
CONCLUSION
From above report it can be concluded as, management accounting is such which do
include the accounting method and it is that which needs to be included as AnswerLab and also
having an preparation of the different account in better way as well. Normally, various
accounting method are those which also lead to have an providence of important information and
also lead to have an data that needs to be used by the different managers even though they have
an planning tools which leads to use as accounting officer and needs to have an ignore with
financial problem which also need to have an enhancement of the business operation. Basically,
there are different thing which do help in having an direction of there employees which leads to
accomplish in great manner too.

REFERENCES
Books and Journals
Albelda, E., 2011. The role of management accounting practices as facilitators of the
environmental management: Evidence from EMAS organisations. Sustainability
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Arroyo, P., 2012. Management accounting change and sustainability: an institutional approach.
Journal of Accounting & Organizational Change. 8(3). pp.286-309.
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idea: the case of beyond budgeting.
Bennett, M.D., Schaltegger, S. and Zvezdov, D., 2013. Exploring corporate practices in
management accounting for sustainability (pp. 1-56). London: ICAEW.
Bodie, Z., 2013. Investments. McGraw-Hill.
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experience(Vol. 12). Routledge.
DRURY, C. M., 2013. Management and cost accounting. Springer.
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Herzig and et. al. 2012. Environmental management accounting: case studies of South-East
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Kihn, L.A., 2010. Performance outcomes in empirical management accounting research: Recent
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Ward, K., 2012. Strategic management accounting. Routledge.