Management Accounting: Types, Reporting Systems, Costing Methods

Management Accounting

Table of Contents
INTRODUCTION...........................................................................................................................3
SECTION 1......................................................................................................................................3
P1:Different types of accounting system and their essential utilisation.....................................3
P2: Various accounting system use in reporting ........................................................................5
M1: Benefits of using merits and demerits of using accounting systems ..................................6
D1:Critical analysis of reporting system.....................................................................................7
P3: Different costing methods.....................................................................................................7
M2: Analysis of accounting tools.............................................................................................11
D2: Critical evaluation of income statements...........................................................................11
SECTION 2....................................................................................................................................11
PART 1..........................................................................................................................................11
P4: Merits and demerits of using planning tools in budgetary control ....................................12
M3: Evaluation of planning tools..............................................................................................13
D3: Critical analysis of financial issues....................................................................................13
PART B..........................................................................................................................................13
P5: Various financial issues and measure to resolve it.............................................................13
M4: Evaluation of financial issues............................................................................................14
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Management accounting is well known as useful process of identification, measurement,
analysis and preparation of financial data those are been used by administration to make plan,
evaluate and control within an organisation. The primary role of managers is to make assure that
appropriate use of accounting data and accountability for its resources are done in well organise
manner. It also comprises the preparation of financial reports for all those parties those are
directly associated with a decision-making of an organisation. Such as shareholders, creditors,
regulator departments and so on (DRURY, 2013).
The main motive of accounting systems is to make appropriate decision about upcoming
growth and stability. This project report provide crucial information regarding importance of
management accounting in order to improve performance of an organisation. Various types of
accounting as well as reporting systems. Use of planning tools in order to control budgetary
process. Few specific techniques which is helpful in solving financial problems are explain under
this project.
SECTION 1
P1:Different types of accounting system and their essential utilisation
In every business enterprises, it has been seen that in order to analyse their accounting
transactions which were perform during there regular business operations. This will help in
providing better chances of increase profitability for the company. Management accounting
informations are collected more systematically and they are evaluated with the help of different
formula and tools. It is best service delivery towards operational operations to increase
productivity and create future opportunities (Management Accounting, 2017). It is more selective
in nature because it choose only those plan which seems to be more profitable for the
department. Accounting information is more helpful in such a manner so that organisational aims
and objectives can be attain in more quick time. In the complex situation, management
accounting is an integral part and effective tools of accounting system (Bodie, 2013). There are
various essential aspects of an organisation. The importance of using management accounting
are discuss underneath:
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Increase in efficiency: It would enhance efficiency of different business activities. The
primary targets of various departments are set prior on forecasting and planning to analyse actual
performance of an organisation.
Measurement of performance: Management accounting plays an important role in
evaluating work performance through the techniques of standard costing and some other aspects
of the departments.
Effective management control: It is more vital for the purpose of increase efficiency of
engagement which depends upon its effective control system. This is a continuous process which
needs to be done to gain maximum advantages of an organisation.
Management accounting Financial accounting
These are mainly regulated by applying top
management decisions. It is not said to be
standardized format.
Financial accounting is totally regulated by
using legal laws and regulations.
These are uses as future data and information
which is not only historical data for the ways
of planning.
These are generally focuses on economic
events which is based on past events and it
does consists of historical data.
The frequency of preparing financial
statements is defined by company itself.
The complication of these statements must
indicate the company as a whole.
All the information that are collected in an
organisation is managed by internal auditors.
Under this, data content of the publish financial
records is mainly supervised by an auditor.
Types of accounting system:
Price optimisation: According to this particular system they need to identify perception
of customers regarding what they think about various prices which is been changed by company
for their products. The information used in various price optimisation consists of various
operating costs, stock and historical value and sales. For this purpose, they uses mathematical
analysis through a company to examine customers reaction about their product feature and
qualities (Kotas, 2014).
Cost accounting system: These accounting systems is related with the total cost a
company incur for the purpose of producing product. The primary aim of an organisation to
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