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Management Accounting - TPG processing company

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Added on  2021-02-22

Management Accounting - TPG processing company

   Added on 2021-02-22

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MANAGEMENTACCOUNTING
Management Accounting - TPG processing company_1
Table of ContentsINTRODUCTION ..........................................................................................................................3PART (A).........................................................................................................................................31. Explanation of management accounting..................................................................................32. Role of management accounting system along with various kind of accounting systems......43. Different method of management accounting reporting..........................................................64. Evaluation of management accounting system is integrated with the organisation................85. Evaluation of benefits of management accounting system......................................................86. Conclusions that reflect about the application of management accounting system.................9PART (B).........................................................................................................................................9(a) Advantages and disadvantages of different kind of planning tools of budgetary control......9(b) Analysis of use of various planning tools and their application for preparing andforecasting the budgets..............................................................................................................10(c) Comparison of two organisations to resolve the financial issue by adapting themanagement accounting system................................................................................................10(d) Management accounting system to solve the financial issue that leads to organisationalsuccess........................................................................................................................................12CONCLUSION .............................................................................................................................12REFERENCES..............................................................................................................................13
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INTRODUCTION Management accounting is an accounting system which provides financial and nonfinancial information to the managers to make internal decisions (Arnaboldi, Lapsley,Steccolini, 2015). In other words, this accounting system is related to the collecting, preparing,summarising and interpreting the monetary and non monetary information. Herein, the projectreport management accounting system and its types are mentioned as well as different method ofmanagement accounting reporting are also described. Apart from it, advantages anddisadvantages of planning tools of budgetary control is also described along with role ofmanagement accounting in solving the financial issues. To understand in detail about themanagement accounting system, TPG processing company is selected that operates inmanufacturing sector.PART (A)1. Explanation of management accounting.Management accounting system is an accounting system, that provides necessary andneeded information to the managers for internal management of the organisations (Sisaye,Birnberg, 2012). Herein, some definition of management accounting system are mentionedbelow:According to the IMA (Institute of management accountants), “The managementaccounting can be defined as a kind of profession that includes partnering in the managementdecision making, planning, performance management and expertise in financial reporting”(Jakobsen, 2012).Comment- As per the above mentioned definition it can be comment that managementaccounting system is very crucial for management of the organisations. On this accountingsystem, managers can relay for decision making. Like in the TPG processing company, thisaccounting system can be very beneficial for them in making planning and strategies for future.According to the CIMA (Charted institute of management accountants), “ Themanagement accounting system can be defined as a process of measuring, accumulating,preparing and communicating the information to managers so that they can take importantdecisions” (Gibassier, 2017).
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Comment- As per the above mentioned definition of CIMA, it can be comment that thisaccounting system contains a wide and detailed process of presenting the financial and nonfinancial data. On the basis of this analysed information, companies take many importantdecisions. Same as in the the TPG processing company, the management accounting system canhelp them in making effective plans and policies for further decision making related to themanufacturing system. 2. Role of management accounting system along with various kind of accounting systems.The management accounting system plays an important role for management of thecompanies (Schaltegger and Zvezdov, 2015). Due to this accounting system, organisations canmake further plans, policies and strategies. Herein, the context of TPG processing company, themanagement accounting system is very important. This is why because, they are operating in themanufacturing sector and various kind of accounting system helps them. Herein, some functionof the management accounting system are mentioned below:Planning- This is the first and important function of the management accounting. In thisall needed information and authentic data is collected for planning. For example, in theStarbucks company, they make planning related to the manufacturing of the products andservices which helps in important decision making.Controlling- In this function of the management accounting system, it is being ensuredby the manager of the organisation that all available resources are effectively allocated ornot. Such as in the Starbucks company, their managers use this function of managementaccounting in controlling the use of various kind of resources.Cost accounting- As the name assists, this function of management accounting helps tothe organisations in controlling and predicting the future cost of different kind ofactivities (Soltes, 2014). Like in the Starbucks company, they can use this function inforecasting the cost of manufacturing.Financial management- This is the function of management accounting which is relatedto the collecting, analysing and managing of the financial information. With the help ofthis function, the accountant of the Starbucks company manage all the financialtransactions effectively.Auditing- This function of the management accounting is very important for thecompanies. It is related with the inspection of the various kind of financial statements. In
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