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Management Accounting System and Its Essentials

   

Added on  2020-07-22

16 Pages4648 Words46 Views
MANAGEMENTACCOUNTING

Table of ContentsFROM: MANAGEMENT ACCOUNTING OFFICER..................................................................1TO,...................................................................................................................................................1GENERAL MANAGER..................................................................................................................1UNICORN GROCERY...................................................................................................................1SUB: MANAGEMENT ACCOUNTING SYSTEM .....................................................................1INTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1: Types of management accounting system and its essentials................................................1P2: Different reporting system used in management accounting................................................3M1: Advantages of using management accounting system .......................................................5D1: Critical evaluation of reporting system ...............................................................................5TASK 2............................................................................................................................................5P3: Costing methods used in management accounting...............................................................5M2: Accounting techniques analysis........................................................................................7D2: Critical evaluation of income statements.............................................................................8TASK 3............................................................................................................................................8P4: Advantage and disadvantage of using planning tools...........................................................8M3: Critical evaluation of planning tools.................................................................................10D3: Analysis of techniques which is used in resolving financial problem ..............................10TASK 4..........................................................................................................................................10P5: Measures to overcome financial issues with comparing it with other company................10M4: Analysis of financial problem ..........................................................................................11CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................13

FROM: MANAGEMENT ACCOUNTING OFFICERTO,GENERAL MANAGERUNICORN GROCERYSUB: MANAGEMENT ACCOUNTING SYSTEM INTRODUCTIONManagement accounting is a crucial aspect of an organisation that help in attaining futuresustainability for the company. It is simply termed as tools and techniques which provideaccounting data in order to carry out various activities like planning, controlling, analysing anddecision-making (Burritt, Schaltegger and Zvezdov, 2011). It guides managers in determiningcritical issues, formulating plan and optimising the use of necessary resources. The report coversdifferent types of accounting system and its essential use in an organisation. Some other aspectsare related with reporting and costing methods which is used for their purpose of making criticaldecision company. Further, this provide information about benefits and limitation of planningtools those are associated with budgetary control. They understanding of financial issues that arepresent in an organisation and measure used to over come all these problems. TASK 1P1: Types of management accounting system and its essentialsManagement accounting: It refers to providing financial and statistical information tobusiness managers in order to make short-term as well as long term managerial decision. It helpsin identifying, measuring, interpreting, and communicating the material information which helpan organisation to achieve their desired goals. It is also considered as any form of accountingthat enables a firm to be conducted more efficiently its daily operations (Cooper, Ezzamel andQu, 2017). It help the team as well as organisation to work according to set standards in order tomake attain more effective results. MA is categories with certain variance report analyses whichis based on actual and standard performance of an organisation. This can be considered asprimary part of accounting system that facilitate managers to take vital decision in favour of thecompany. Management accounting reports provide the details about the accounts in order to find1

out the company's sales revenue, accounts payable and receivable etc. The managers should needto provide financial and statistical information in order to take decisions related to developingnew products and services, borrow money from the investors so as to help in financing thecompany and to increases or decreases operating capacity of the business. With the use of correctaccounting system every issues related with development of an organisation can be resolved. Theissues are required to be overcome in short period of time so that it cannot get affect any othersegment of the department. In current time, there is lot of burden to manage financial records ofthe company. Whether related with public or private Ltd organisation. The efficiency can only be enhance by using appropriate tools which can help them togenerate maximum growth and profitability (Hoque, 2011). The base of future planning set onlyafter making necessary financial statements in more effective manner. In case of Unicorngrocery, they need a system that can be so effective in recording financial transaction which areperformed by an organisation. The net profitability and stability can only be relies on results thatis generated by using different accounting system. For this purpose, managers need to analyseinformation in related to sales, income, profit, stock position and performance of an individualthose are working for the development of an organisation. It enables the company to enhancetheir profitability situation of business by identifying the core needs of internal management. Itplays a vital role in achieving their goals and objectives. Advantage of management accounting: It help to bring uniformity in the business by making improvisation in cash flows throughbudgetary control. It ensure highest possibility for getting return on capital employed through evaluation ofqualitative and quantitative information.MA leads to maximum utilisation of resources and improve efficiency through unwantedaspects those are affecting the performances of an organisation.There are different types of management accounting which are as follows:Cost accounting system: This types of management accounting helps in monitoring andcontrolling the business operation and also helps in analysing product probability. A goodcost accounting system enables an organisation to compute cost of sale and means forvaluing inventories. It identifies the reasons being the wastage which helps in costreduction.2

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