Role of Management Accounting and Types of MAS

MANAGEMENT
ACCOUNTING

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK 1............................................................................................................................................3
TASK 2............................................................................................................................................8
TASK 3..........................................................................................................................................11
TASK 4..........................................................................................................................................13
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
The term MA is an accounting process of assessing data regards to monetary & non
monetary transactions and activities with an aim of producing reports (Fleischman and Parker,
2017). In the aspect of today's competitive business environment, this is essential for business
entities to manage their all activities and operations in a systematic manner by implementation of
an effective accounting system so that desired outcomes can be achieved. In this project report a
company is selected that is British American Tobacco Plc. The company is located in London
and manufacturer of cigarette and tobacco. As well as this business entity is the second largest
cigarette maker in the world as accordance of financial information of year 2012. The project
report covers about a vital range of MAS and MA reports. As well as income statements are
produced by help of costing techniques. Along with, variety of planning tools and significance of
MAS in order to sort out the monetary problems is covered under the project report.
MAIN BODY
TASK 1
Role of MA and types of MAS.
Management accounting – The MA is an accounting process in that reports are produced
for internal stakeholders' perspective. By deriving useful data from these reports managers of
business entities become able to take corrective actions as accordance of need (Gurarda, 2015).
In other words, under this accounting internal reports are prepared by accountants which consists
information regards to monetary and anti monetary aspects. These reports help to management
department in order to take corrective actions.
Herein, it is important to know that these reports are not disclosed to external stakeholders.
Below the role of MA is mentioned that is as followings :
 Beneficial for long and short term planning – By help of MA, the companies can make
plan effectively for long and short time period. It becomes possible because managers
assess useful information through these reports and take decisions accordingly.
 Better controlling – In addition, another role of MA is to focusing on better controlling
over different aspects of businesses. This is so because by utilising important

information, managers can aware about actual financial performance and controls
accordingly.
 Participating in management process – The another role of MA is that, it is helpful for
making participation in managerial process. Due to this accounting, the business entities
can derive both types of information in the aspect of management.
MAS- In the aspect of companies' different operations and activities, this is too crucial to apply
different accounting systems as accordance of requirement. The MAS can be defined as those
accounting systems that provide framework in order to manage different aspects of companies.
Types of MAS :
 Cost accounting system – It is an accounting system which is involved in the process of
gathering and summarising all information regards to cost of various activities (Verma,
2015). Under this accounting system, projection of future possible costs and expenses is
done in an accurate manner so that managers can allocate their resources accordingly.
This accounting system is essential for businesses in order to trace the variances between
actual cost and estimated cost. As well as this accounting system is needed in business
entities for proper management of occurred expenditures in a better way. In the above
respective company, British American Tobacco Plc their finance department is using this
accounting system in order to control total cost of different aspects. In addition, due to
this accounting system they estimate future possible costs that helps in creation of
accurate budget.
 Inventory management system – This is an accounting system which is aligned with
procedure of in and outing of materials from warehouses. By implementation of the stock
management system, the managers of companies can gather useful data in order to take
futuristic steps corrective. Additionally, it is required in companies for making balance
between supply and demand of materials. Eventually, for manufacturing business entities
it is very beneficial because by getting information regards to remained quantity of
commodities in stores the managers make further financial plan for buying and
manufacturing of outputs. In the absence of proper management of inventories, this may
lead to higher cost of storing materials. As well as companies will not be able to take
corrective actions accordance to need. The stock management system is needed for