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Evaluation of financial system and reporting

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Added on  2019-12-28

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In fact management accounting system is mainly made for the making of proper financial report because for the betterment of company or to minimize the organization liability every company need to pays the equal attention on the financial reports also as all the business is depend on the capital only(Ward, 2012). In fact management accounting system is mainly made for the making of proper financial report because for the betterment of company or to minimize the organization liability every company need to pays the equal attention on the financial reports also as all the business

Evaluation of financial system and reporting

   Added on 2019-12-28

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MANAGEMENTACCOUNTING
Evaluation of financial system and reporting_1
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................3P1&M1.Management accounting and its type.......................................................................3P2. Various methods used for the management accounting report........................................5D1. Evaluation of financial system and reporting..................................................................6TASK 2............................................................................................................................................7P3: Calculation of marginal and absorption costing...............................................................7M2. Evaluation on the basis of calculation............................................................................9D2. Interpretation on the basis of marginal and absorption cost............................................9TASK 3 .........................................................................................................................................10P4, M3 & D3. Budgetary control and its advantage and disadvantages of its techniques ..10P5. Adoption of accounting system to solve financial problems.........................................12M4. Management accounting responded towards financial problems................................13CONCLUSION..............................................................................................................................14REFERENCE.................................................................................................................................16
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INTRODUCTIONThe following project report is the description of the management accounting of the smalland medium size businesses. It began with the concept of the topic and its advantages anddisadvantages, types of accounting, methods used for the calculation and different types of toolsof budgetary control (Kaplan and Atkinson, 2015). The most basic thing that to manage theiraccounts they are given more priority to the management decision and the planning theiroperation for the future to maximise more profit and tried to get the goal and objectives of theorganisation.Through this report we have made certain assumption about the business for the futureplanning and implementation .It is based on the personal and statistical assumption of theavailable data of calculation to manage the operations of business. Main purpose of report is toexplain about the management of accounts of small business enterprises.TASK 1P1&M1.Management accounting and its typeIt simply defines the overall accounting system of an organization which means it dealswith all the financial issues. In fact management accounting is concerned with the preparing ofall the accounting reports to control the future cost. Basically management accounting shows theappropriate report which act as an effective and useful tool while planning period or to estimatethe future sales and return on investment (Bodie, 2013). As management accounting express themanaging of all monetary terms in appropriate manner by minimizing their losses with the helpof accurate estimation. In other words the term management accounting is about controlling ofextra cost by making effective balance sheet so that all the company must aware about theiravailable assets and liability.Management accounting system consist of various type of accounting systems to controlthe cost of the company by maximizing their sales. In fact management accounting system ismainly made for the making of proper financial report because for the betterment of company orto minimize the organization liability every company need to pays the equal attention on thefinancial reports also as all the business is depend on the capital only(Ward, 2012). Capital actas a backbone for every small and large industry as initially everyone requires a sufficientamount of monetary fund to establish a business.
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Basically types of accounting system is a system made by the organization to collect allthe relevant accounting data and information or to store them so that it become useful whiletaking decision for the company (Bodie, 2013). In fact accounting system have different types ofaccounting system which is very essential for appropriate analysing of all the monetary terms.Here are various types of accounting systems: 1.Lean accounting: - Mainly lean accounting is the term which is not only concerned withcost in fact the main target of lean accounting is to reduce the extra and unusual cost byeliminating the wastage. Basically with the help of lean accounting a company get awareabout their wastage and try to solve that problem by using appropriate data andinformation which is available in the financial system for minimizing their cost. In otherwords lean accounting main aim is to reduce or to control the extra cost (Burritt,Schaltegger and Zvezdov, 2011).2.Traditional management accounting systems:- This accounting system is a kind of oldsystem of managing accounting which means they are mostly deal with all the relevantfact and figures to control their company overall wastage of cost. In fact this system ofaccounting uses the job order and process costing methods. Both of the costing methodsare used to identify how a company use their fund relating to direct labour, raw materialsand manufacturing overhead.Management accounting system is very beneficiary for all the organization because it isvery helpful for enterprises as due to financial accounting system a company can easily try tocontrol their wastage by controlling their unusual cost. Capital plays a major role duringestablishment of an enterprise as all the resources are available with the use of cost only. Management accounting system is very effective and useful for the company as thissystems contains all the past records of financial transactions which is very indispensable whiletaking decision regarding financial activities. In addition applications of management also act asa very helpful in reduction of extra cost (Parker, 2012). Simply management accounting system throw some light on all the factors which comesunder accounting system to reduce all the upcoming issues related to finance. In fact for smoothfunctioning of all the organization a company need to make appropriate accounting system toovercome the instant difficulty which means the main task is to complete all the activitieseffectively and efficiently tom achieve their target and goals.
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