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Types of Management Accounting - Report

   

Added on  2020-07-22

16 Pages4409 Words64 Views
Management Accounting

Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1 Management accounting systems..........................................................................................1P2 Different types of management accounting reports...............................................................3M1...............................................................................................................................................5D1................................................................................................................................................5TASK 2............................................................................................................................................5P3 Application of cost accounting techniques............................................................................5M2...............................................................................................................................................8D2................................................................................................................................................8TASK 3............................................................................................................................................9P4 Different planning tools and advantages and disadvantages of budgets................................9M3.............................................................................................................................................10D3..............................................................................................................................................11TASK 4..........................................................................................................................................11M4.............................................................................................................................................12CONCLUSION..............................................................................................................................12REFERENCES..............................................................................................................................14

INTRODUCTIONManagement accounting is the process which helps in evaluation of business costs forpreparation of internal financial reports and records which assists internal parties of organisationin decision-making process. It provides the management of organisation is achieve their goalswithin stipulated period of time. To improve the performance of each and every departmentmanagement of organisation is need to implement effective management accounting systemwhich improves their understanding and coordination. The different requirements which arefulfilled through adoption of the provisions of management accounting includes assessment ofrisk, allocation of resources, measurement of performance etc. Tech(UK)Ltd. Is manufacturingorganisation in UK (Zimmerman and Yahya-Zadeh, 2011). In the present report explain about, different types of management accounting and itsessential requirement, different types of management accounting reports and their importanceand application of cost accounting techniques in formulation of income statements. Also,advantages and disadvantages of different kind of budgets and its importance for planning andcontrol process and application of the principles of management accounting to overcome fromfinancial problems.TASK 1P1 Management accounting systemsManagement Accounting: It includes the process about determination, analysis,interpretation and presentation of accounting information through application of the principles ofmanagerial and cost accounting. It provides the opportunity to the business manager ofTech(UK)Ltd. Is to formulate their strategies and budgets with the helps of such information foreffective operation of their day to day operations. It also assists the manager in performance offour major functions like planning, organising, monitoring and controlling (Weißenberger andAngelkort, 2011).Importance of management accounting as decision-making tool

Tech(UK)Ltd. Is producing special chargers for mobile telephones and other gadgets forthe retail outlets which are operating in UK. The major issues which are faced by them whileproviding their business functions in lack of financial information which has adverse impactupon their decision-making power. Management accounting is broad concept which alsoincludes the provisions of cost accounting. It helps in preparation of reports upon theperformance of different departments (Management accounting and its importance). The manyother importance of such systems through its implementation in organisation is defined below:Forecasting cash flows: It helps in estimation of flow of cash in organisation withinspecifies period of time. It provides opportunity is to manage their future transactionsaccording to such availability of working capital. Prediction of variances: One of the important function is that it helps to identify thedeviations in the actual performance of employees though comparison with set standards.It helps to use analytical techniques to retain positive variances and effectivemanagement of negative ones.Evaluation of rate of return: Effective application of the provisions of managementaccounting helps in determination of the returns which are associated with differentprojects. It contributes in selection of most profitable projects and improves their earning.Difference between management and financial accountingManagement AccountingFinancial AccountingIt is broad concept which includes thepreparation of different accounts which depictsthe information about different departments oforganisationThis includes the preparation of financialstatements of whole organisation whichprovides information about financial position This can be used by internal parties fordecision making processIt is used by the external parties to takedecisions about their investment decisionsMore emphasis is provide on futureIt has historical perspectiveIt provides the opportunity regarding planning,organising, monitoring and controllingTo make strategies for improvement offinancial performance of organisation

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