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Using Accounting System in Business : Report

   

Added on  2020-07-22

16 Pages4771 Words40 Views
Management Accounting

Table of ContentsFrom: Management Accounting Officer..........................................................................................1To,....................................................................................................................................................1General Manager, Unicorn Grocery................................................................................................1Subject: Management Accounting System .....................................................................................1INTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1. Management accounting system and its use....................................................................1P2. Various accounting system reporting...............................................................................3M1: Benefits of management accounting system ..................................................................6D1: Evaluation of accounting system reporting.....................................................................6TASK2.............................................................................................................................................6P3: Different costing method used by company to get net profit ..........................................6M2: Techniques of accounting .............................................................................................8D2: Results analysis which is collected from above income statements................................9TASK 3............................................................................................................................................9P4: Advantages and disadvantage of using planning tools....................................................9M3: Analysis of planning tools............................................................................................11D3: Analysis of tools that is used for solving financial issues.............................................11TASK4...........................................................................................................................................11P5: Comparison of organisation about how they face financial issues................................11M4: Evaluation of financial issues.......................................................................................12CONCLUSION..............................................................................................................................12REFERENCES..............................................................................................................................12

From: Management Accounting OfficerTo,General Manager, Unicorn GrocerySubject: Management Accounting System INTRODUCTIONManagement and accounting; both are interrelated with each other. Accounting is relatedwith collection, summarising, analysis and recording of financial transactions. While, on theother hand, management helps to regulate those accounting information in more systematic andplan ways in order to attain there long and short term goals (Ahadiat, 2013). It is considered asan important part of any business organisation by which all valuable information are recordedand controlled by the managers in an effective manner. The prime objective of using accountingsystem in business is to increase maximum profit with available resources. The report is preparedby keeping all matters in the right direction. It consists of various accounting and reportingsystems that are helpful for company in attaining their future targets. Further, this report providesinformation about how costing techniques can be useful for company to analyse their net profits.The understanding of various planning tools used in budgetary control process are explainedclearly. At the end, this report provides information about financial issues faced by organizationthrough making comparison among two companies.TASK 1P1. Management accounting system and its useManagement accounting is known as a systematic method to plan and control variousfunctions of departments. It provides information for setting right option and strategies for asystematised standard targets. It is also used to report variance analysis among actualperformances and standards by taking corrective actions (Ahmad and Kamilah, 2013) . By thisway, it is considered as the prime part of accounting system that facilitates the decision makingprocess of management process.Accounting system consists of every accounting technique that may be helpful formanagement in discharging their functional aspects such as planning, organizing, directing and1

controlling. Management accounting can be observed as a practical tool that is aimed atresolving day-to-day financial issues which is arises in an organisation.These problems makesthe top administration to face difficulties in taking effective decision in most private and publicsectors enterprises. In competitive business market scenario, and within a public sectors that isincreasingly target upon effectiveness, creating values for money and best accounting practices.All of them are responsible for both management and accounting. It is orientated towards thecoming future. It is basically related with the provision of data to managers to help them plan, evaluateand manage various activities (Baldvinsdottir, Mitchell and Nørreklit, 2010). Unicorn Groceryrequires an essential accounting service function which can help them to organise their businesstransactions in an effective manner. It target of management accounting system is to improve thefuture performance of organisation, managers would require information regarding sales trends,profitability, inventory position and performance of salespeople. All these are determined byusing effective accounting systems. The tasks of management accounting are related withfurnishing of accounting information to the management for making its decision on that basis. Italso helps in improvising the efficiency and attaining organisational aim and objectives. Some ofthe main characteristics of using MA system are:Effective decision making system: It will help to provide accounting data by whichhigher authorities can take effective policy decision (DRURY, 2013).Cause and effect analysis: According to this, if there is any loss, the reasons for the lossare probed. While, if there is profit then various factors like different expenses, currentassets and other share capital are analysed.Taking more valuable decision: It would help to guide right and more accurateinformation to the management about the performances of the company. On that basisnecessary decision are taken.The accounting systems which can be useful for Unicorn Grocery are discussed as below:Costing accounting system: It is considers as a framework used by company's todetermine the total cost of their goods and services in profit evaluation, stock analysis and costcontrol. Identification of correct cost of product is vary critical for operation profits(Management Accounting, 2016). In the waysto estimate cost of production various other costsare also analysed such as normal, standard and actual costing.2

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