Management Accounting and Planning Tools

MANAGEMENT
ACCOUNTING

INTRODUCTION
Management accounting is the process to enhance quality operation of the business with
the help of making different management decision in the organization (Cooper, Ezzamel and Qu,
2017). In this, process accountants of the organization are provided with different internal
information about the company and different decision are made in the organization. Deloitte, is a
multinational professional services network, which is one of the "Big Four" accounting
organizations. Excite Entertainment Ltd. is a client of this consultancy firm which is seeking
consultancy services for the analysis of their available growth opportunities. Excite
Entertainment Ltd. was incorporated on 03 January 1995. It is classified as Non-govt company.
This report highlights about management accounting and difference of same with financial
accounting. After which the report highlights different type of accounting system and benefit
brought by them in the organization. After that the report highlights the importance of presenting
accurate data and different type of management accounting report. Report than goes to highlight
calculation of cost with the help of marginal and absorption cost. Report also highlights different
type of budgetary planning tool and pros and cons of same. In the end the report highlights the
different type of Accounting measurement system and different way different organization used
to adopt the same. Also calculation of breakeven point for cited organization.
SCENARIO 1
Section A: Understanding of management accounting systems
Management accounting is the process of analysing different type of business cost and
internal report of an organization to be used by manager of an organization for making different
decision in an organization.
Difference between Management and Financial Accounting
Management accounting is the form of the accounting which looks at providing good
source of internal information about the business to manager in the organization, so that manager
can take different decision in an organization (Schaltegger and Burritt, 2017).
Financial accounting whereas is a specialized branch of accounting which used to keeps
track on different financial transaction of an organization. :
Basis Management Accounting Financial accounting
Aggregation Management accounting used Financial accounting at the

to study operation of the
business at more detailed level.
Such as profit by product,
product line and geographic
region.
same time used to study the
operation of business as a
whole. As they used to depend
on the result of entire business.
Reporting focus Management accounting used
to consider operational report
of an organization. The report
which are generally distributed
within a company.
Financial accounting at the
same time looks at creation of
financial statement, which are
distributed both within and
outside organization.
Timing Management accounting used
to issue the reports in the
organization more frequently,
depending upon the
requirement or need of
information for the manager.
Financial accounting reports
are generally issued following
the end of an accounting
period.
Standard Management accounting used
to not compile with any of the
standard, when information is
compiled for internal
consumption (Rikhardsson,
2017).
Financial accounting at the
time has to compile with
various accounting standards.
Accounting System and their benefit
Accounting system is the tool which is generally adopted in an organization to organize
different financial information in organization. This system generally keeps track on different
expenses, income and activities (Management accounting system, 2016). Some of Accounting
System are as follows:
Cost Accounting System: Cost Accounting system is a system which is generally used
by an organization to known the cost incurred by an organization to carry out different operation