Management Accounting Reports Types

MANAGEMENT
ACCOUNTING

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Difference between management accounting and financial accounting ...............................1
Different types of management accounting system................................................................2
Benefits of management accounting system..........................................................................3
Types of management accounting reports..............................................................................3
Presentation of information in reports....................................................................................4
Management accounting system and management accounting reports integrated within
operational process.................................................................................................................4
TASK 2............................................................................................................................................4
TASK 3............................................................................................................................................6
Planning tools used in management accounting ....................................................................6
Compare ways to dealing with financial problems and preventing in an organisation..........8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Management accounting is the process of analysing business costs and operations to
prepare internal financial report, records and account to aid managers' decision making process
in achieving business goals (Management Accounting, 2019). It is also known as cost accounting
and managerial accounting. It is considering as act of sense to record financial and costing data
in order to provide management. To understand the concept of report selected organisation
Excite Entertainment Ltd which operates in leisure and entertainment industry in the UK. In the
report consist of management accounting system, methods of management accounting reports.
Apart from the report calculate profitability through absorption costing and marginal costing.
Compare of planning tools in management accounting and use information to dealing with
financial problem.
TASK 1
Difference between management accounting and financial accounting
Basis Management Accounting Financial Accounting
Information mainly
produced for
In management accounting reports
and accounts mainly prepare for
internal use like managers and
employees
In financial accounting reports
mainly prepare for external use
such as banks, government,
creditors and shareholders.
Legal Requirements To prepare report there is no need to
legal requirements.
The final accounts produced by
limited companies.
Nature of
information
Through reports provided financial
and non financial information
In these types reports mainly
provided financial information.
Focus on There are focused on specific areas
of the business (Difference between
management accounting and
financial accounting. 2012)
Mostly reports focused on the
whole business
Formats Management has been decided on
the information they need and the
Format and content of financial
accounts intending to provide true
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most useful way of presenting it. and fair picture which is following
standards and company law.
Different types of management accounting system
Cost accounting System – It is a framework which is used by an organisation in order to
predict the cost of their products to analysis profitability, valuation of stocks and cost control.
There are determining the accurate cost of products is critical for profitable operations. The
particular system mainly used to record production activities through perceptual inventory
system. The particular system used by Excite Entertainment Ltd in order to know which products
are profitable for company and which is not (Uyar and Kuzey, 2016) . It can provide closing
value of the products as well as finished goods inventory for the purpose of preparation financial
statement. Direct Cost – A direct cost is expenses which is directly track to recognise specific cost
and cost object in reference to products, process and departments. There are mainly
consider of direct material, direct labour and fuel.
 Standard Costing – It is consider as planning tool which can use to planning about the
budgets, managing and controlling cost then analysis of cost management performance.
In standard costing to determine need to cost of production process.
Inventory Management System
It is a type of management accounting system which is used to monitor and track of
goods in effective manner. Through supply chain track material then operate according to
business requirement. In Excite Entertainment Ltd, manager can be adopted particular system in
order to manage and supervise material. The enterprise focus on everything in reference to stock
like production to retail and warehousing to shipping.
Job Costing System
The particular system mainly used by manufacturers but many times it will be used by
other companies in order to record business activities. The particular system related to jobs and
in the entertainment industry need to different types people who have skill of their job. In Excite
Entertainment Ltd, the system used by manager in order to serving delivery and help to manage
cost for every job (Brierley and Gwilliam, 2017).
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