Managing Accounting in Response to Overcoming Financial Issues

Management
Accounting

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1. ..........................................................................................................................................1
P1 Explanation of management accounting and essential requirement of various accounting
systems........................................................................................................................................1
P2. Explanation of various kind of methods of management accounting reporting...................3
TASK 2. ..........................................................................................................................................4
P3 Costing Techniques for preparing the financial statements...................................................4
TASK 3............................................................................................................................................8
P4 Benefits and drawbacks of different planning tools..............................................................8
TASK 4..........................................................................................................................................11
P5 Management accounting in response to overcome financial issues.....................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
In accounting term the concept related with arranging, organising, reporting, evaluating
and measuring total financial performance by the responsible manager in order to assess the
overall financial position is known as management accounting (Antipova and Bourmistrov,
2013). This process support in decision making and reducing the factors due to which
performance and profitability of business can be reduces and makes policies and strategies to
improve the entire profit margin in nearby future. In this report, stitch-land medium-sized
manufacture company have been selected to better underestimates the methodologies of
management accounting. The company use to produce designer cloths as per the latest trends and
needs of customer.
In this report, detail of management accounting reports and system have been discussed,
along with costing techniques are used to prepare income statements to determine net profit for
the year. Different kind of planning tool are being applies to prepare budgets and overcome
financial issues.
TASK 1.
P1 Explanation of management accounting and essential requirement of various accounting
systems.
In the present business scenario, the accounting process that is related with the internal
management of company and provide essential support in collecting, sorting, reporting,
examining and assessing the crucial financial informatics so that resources are fully utilised to
achieved the predefined target is known as management accounting.
Management accounting is being continuously used within each kind of businesses as
there are number of useful management accounting system which benefit the manager to
arrange and organise financial and non-financial informations that are supportive to make
decision regarding increasing and improving total profitability and productivity of an
organisation. Each system have its own importance to a company that are applied by inner
managerial personnels to control and improve mechanisms of valuable operation.
Integration of assorted systems within organisations:
It is stated that every system are equally important and have valuable use in Stitchland.
Such as cost system aid to compute the actual figure of cost utilisation whereas inventory system
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is advantageous in managing stock available in warehouse and available for sale. In addition
price optimisation system give a structure for deciding the prices (Carpenter and Mahoney,
2012).
Origin, role and principle of management accounting system:
The concept of management accounting was originated with the time of revolution of
business industries in England around 500 BC which and the main role is to provide conceptual
framework to the manager of company to make decision regarding improvement and attainment
of desired goals.
There are principally four kind of principle and rule such as relevance, influence, trust
and value. Each principles have their value for impressive outcome of management accounting
that help to accomplish goals and objective.
Financial and management accounting system:
Basis Management accounting system Financial accounting system
Significance It is an important part of internal
stakeholders which help them to make
decision for internal improvement.
Financial accounting on the other side is
is an important beneficial for external
and internal stakeholders to analyse the
entire financial status and position of
company.
Time period Manager are supposed to prepare
management reports as per their
convenience to make valuable
judgement.
This basically includes preparation of
financial statements at the end of an
accounting year.
Different type of management accounting system:
Cost-accounting systems: This cost system in related with a legal framework that are
define for the purpose of predicting cost of goods and services that are produced within
company. In Stitch-land manager with the help of this tool are able to control and manage the
total cost that is included within producing different cloths so that they can easily determine the
actual profitability of different operation activities.
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