Management Accounting: Comparison, Costing Techniques, and Planning Tools

MANAGEMENT
ACCOUNTING

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
TASK 2............................................................................................................................................7
TASK 3..........................................................................................................................................11
TASK 4..........................................................................................................................................12
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
The management accounting a way of guiding managers of business entities in order to
take corrective actions and steps (Oldroyd, 2017). Under this accounting monetary and non
monetary data are utilised for preparation of reports as well as these reports are prepared as
accordance of need of companies. In the report a company is selected that is Excite entertainment
limited. It is located in UK and operates in entertainment aspect. The project report covers
various MAS and MA reports. As well as two income statements are prepared by use of give
data. In addition, planning tools are also covered under the budget. Further, role of MAS in
sorting monetary issues is covered in the project report.
TASK 1
Section A
(a) Comparison between MA and Financial accounting.
Management accounting – It can be defined as a kind of accounting approach that is associated
with process of recording companies financial and non financial transactions in a systematic
manner. The purpose of recording these transactions is to produce internal managerial reports
which can be used at important decision level.
Financial accounting – This accounting is completely variant from above accounting. It is a type
of accounting which is linked with procedure of collecting monetary informations with an
objective of preparing monetary reports (Busco and Quattrone, 2015). These reports are being
used by both internal and external aspects for own purposes.
Difference :
Basis MA Financial accounting
Publication of
reports
The MA reports are prepared and
presented to internal users specially
for managers and board of directors.
While in this accounting, monetary
reports are presented to all
stakeholders who are linked with
companies.

Format of
preparing reports
There is no any specific format by
which reports can be prepared. Most
of the organisations, produce these
reports as per own suitability and
understanding.
On the other hand, in this accounting
it is necessary for companies to
prepare the monetary reports as
according to international financial
reporting standards.
Nature of
information
which is used
Under this accounting, both monetary
and non monetary information are
utilised by accountants for
preparation of reports.
In this, only monetary information is
applied for producing reports by
accountants.
Various types of MAS:
(b) Cost accounting system – This is an accounting system which is integrated with the
systematic process of gathering information about monetary aspects of different functions and
activities. On the basis of all collected data regards to cost of various aspects finance managers
of companies make corrective projection of futuristic expenditures. In addition, this accounting
system is widely used in those organisations wherein large number of monetary transactions are
done on regular interval. In the above chosen business entity Excite entertainment limited
company, their finance managers trace the usage of their monetary resources in different kind of
operations. It overall helps in making an effective control over expenditures.
(c) Inventory management system – In the context of this competitive business environment only
those companies can sustain who manage their costs and inventories in an effective manner
(Grace, Phillips and Shimpi, 2015). So basically, stock management system can be defined as
an accounting system that combines with the manufacturing department of companies and keeps
the detailed record about how much quantity of material are bought and how much quantity is
being used for production. By assessing useful information about stock, the production manager
of companies can trace daily consumption of material in manufacturing process and as per it
control total storage cost. In the aspect of above Excite entertainment limited company, their
managers of stock collect important data about how much number of gadgets are used in
organising events. As well as assess the requirement of purchasing new equipments.