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Management Accounting Systems - Nero Ltd Assignment

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Added on  2020-12-30

Management Accounting Systems - Nero Ltd Assignment

   Added on 2020-12-30

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Management Accounting
Management Accounting Systems - Nero Ltd Assignment_1
Table of ContentsINTRODUCTION...........................................................................................................................3SECTION 1......................................................................................................................................3P1: Different types of accounting system and their essential utilisation....................................3P2: Various accounting system used in reporting.......................................................................5P3: Different costing methods and preparation of income statement.........................................7SECTION 2....................................................................................................................................10PART A.........................................................................................................................................10P4: Merits and demerits of using planning tools in budgetary control.....................................10PART B..........................................................................................................................................12P5: Various financial issues and measure to resolve it.............................................................12CONCLUSION..............................................................................................................................12REFERENCES..............................................................................................................................14
Management Accounting Systems - Nero Ltd Assignment_2
INTRODUCTIONManagement accounting is more useful to identify, measure, analysis and preparation offinancial accounts and reports which helps in making an effective decision and suitable plans forthe betterment of an organisation. For this, accounting managers are liable to record all financialas well as non-financial transactions happened on daily basis operations which help inidentifying the profitable areas where the company get profitable outcomes. Financial reportsshould required to be made by company on annual basis so as to present company's financialposition towards their stakeholders. The present assignment report is based on Nero Ltd. Withthe context of which all other aspects are explained under this report. The project report coversvarious accounting systems and reporting which facilitate management to make an effectivedecision and plans to achieve growth and success. Different planning tools used to controlbudgetary process has been also discussed under this report (Ahadiat, 2013). SECTION 1P1: Different types of accounting system and their essential utilisationThere are lots of transactions made on daily basis business operations which must requiredto be recorded and maintain financial reports such as profit & loss accounts, balance sheet, cashflow statement etc. Such reports are prepared with an objective of identifying the actualfinancial position of company due to which the management are more capable to make furtheractions to resolve errors or deviations if any found in financial accounts. This forcesmanagement to adopt various accounting systems which includes cost accounting systems,inventory management systems, price optimisation system etc. Before adopt such accountingsystems within an organisation it is essential for managers to first identify their important whichare discussed under the below:Increase in efficiency: It will help in finding out the efficiency level of businessactivities through resolving errors or deviations which may restrict employees to perform in bestpossible way (Albu and Albu, 2012).Measurement of performance: Different accounting systems helps in analysing theperformance of employees through comparing their actual with standard performance. This willhelp in finding out the deviation if any, due to which the mangers are in position to resolve asquickly as possible.
Management Accounting Systems - Nero Ltd Assignment_3
Effective management control: Through using management accounting systems, theperformance of employees are easily managed and monitored due to which the company caneasily achieve best possible outcomes.Comparison between financial and management accountingBasisFinancial accountingManagement accountingMeaningIt is an effective accountingsystem which mainly focuseson preparing financialaccounts in order to providefinancial condition ofcompany towards interestparties.It is also an accounting system whichgives valuable information to themanagement about financial as well asnon-financial transactions with the helpof which the management are able tomake an effective decision and suitableplanning.UsersIt includes external partieswhich make financialdecisions and plans.Internal management are the users.Time focusHistorical perspectivesFuture perspectivesRulesRequired to followGAAP/IFRS and prescribedformatsNot restricted by GAP/IFRS RequirementIt is compulsorily required toprepare financial reports tooutside parties.Not compulsorily required.Verifiabilityversus relevanceIt emphasis of objectivity andverifiability.It emphasis on relevanceTypes of accounting system:Price optimisation: This is an effective accounting system which determines the cost ofproducts and services which maximise the satisfaction level of customer. For this, accountingmanager of Nero Ltd. need to hire researcher who conduct research for them and hep them infinding out the actual perception of customers towards the price charged by company on theirproducts and services. The details used in price optimisation include operating cost, stock andhistorical value. Thus, after identifying the current satisfaction level of customers the manager
Management Accounting Systems - Nero Ltd Assignment_4

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