logo

Management Accounting INTRODUCTION

   

Added on  2020-07-23

19 Pages5075 Words338 Views
ManagementAccounting

Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1 ...........................................................................................................................................1P1 Concept of management accounting and its essential requirements......................................1P2 Different types of management accounting reports...............................................................4M1...............................................................................................................................................5D1................................................................................................................................................6TASK 2............................................................................................................................................7P3 Application of the absorption and marginal costing techniques to formulate incomestatements....................................................................................................................................7M2...............................................................................................................................................9D2..............................................................................................................................................10TASK 3..........................................................................................................................................10P4 Advantages and disadvantages of various planning tools used for budgetary control........10P5 Application of principles of management accounting to respond financial issues..............10M3.............................................................................................................................................11M4.............................................................................................................................................11D3..............................................................................................................................................12CONCLUSION..............................................................................................................................12REFERENCES..............................................................................................................................13

INTRODUCTIONManagement accounting is important concept which includes the provisions of bothmanagerial and cost accounting. It includes the preparation of different accounts and reportsthrough application of such provisions for effective management of each and every department.It provides accurate and timely financial and statistical information which is used by managerfurther for operation of day to day functions. This will also considered as the process ofevaluating business costs and operations which improves the decision making power of internalparties regarding accomplishment of business goals. It is different concept from financialaccounting which helps the organisation in formulation of annual reports. Such reports includesthe information about cash, sales revenue, accounts payable and receivable, raw materials,outstanding debts etc. Such reports are used by external parties to take informed decisionsregarding their investments. TATA Motors provides more than 8.5 million branded vehicles inall over the world (Armitage, Webb and Glynn, 2016) . In the present report explain about, concept of management accounting, different types ofmanagement accounting systems and their essential requirements, difference betweenmanagement and financial accounting, application of different kind of management accountingreports to ascertain information and application of absorption and marginal costing concepts toproduce income statements. Also, advantages and disadvantages of different types of planningtools used for budgetary control and contribution of management accounting systems to respondfinancial problems.TASK 1 P1 Concept of management accounting and its essential requirementsManagement Accounting: It is the process which includes about evaluate,interpretation, determination and presentation of accounting information attained by the manager

through application of management and cost accounting techniques. It is also known asprofession which supports in decision-making. It assist the management in formulation andimplementation of strategies in more effective and efficient manner. The different functionswhich are served by management accounting like plan, control, monitor and enhancing the actualperformance of employees through improvement of their understanding about differentdepartmental functions.Definitions of Management AccountingAccording to IMA, Management Accounting is broad concept which assists in decisionmaking process, planning and performance of management systems which helps to bringexpertise regarding financial reporting which helps in formulation of effective organisationalstrategies.According to CIMA, Management accounting is includes identification, analysing,interpretation and communication of important information through which plans are formulateby the management for for optimum utilisation of resources to achieve their desired objectives. Essential requirements of management accountingManagement Accounting helps the manager of TATA motors is to record the differenttransactions and performance of various departments through use of different systems likeinventory management, job costing, price optimisation. Cost accounting etc. To fulfil their manyrequirements need to prepare such different accounts. So, application of management accountingprovisions for consideration of their different requirements are mentioned below:Measurement of performance: One of the major requirement which is fulfilled throughuse of information provided by different accounts is to measure the actual performance ofemployees and their working efficiency. It is the process under which actual performanceare compared with standards to attain information about deviations which can beremoved through adoption of necessary steps (Ferreira, Moulang and Hendro, 2010).Assessment of risk: There are many management accounting systems which helpsidentification of risks associated with business functions. It can be minimised throughadoption of effective policies.Allocation of resources: Through application of the provisions of managementaccounting systems, it is easy to identify requirement of resources by different

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
(Doc) Unit 5 Management Accounting - Assignment
|33
|7481
|64

Report on Application of Marginal and Absorption Costing
|12
|2958
|36

Concept of Management Accounting Assignment
|19
|6072
|34

Management Accounting System : PDF
|16
|4236
|451

Management Accounting System and Reporting
|16
|4236
|95

Scope of Management Accounting: PDF
|15
|4317
|96