Management Accounting

Management accounting

Definition of management accounting
Management accounting is defined as applying
skills and expertise in financial and other
information which helps in decision-making and
helps in formulating the policies and implementing
strategies.

Types of management accounting systems
 Cost accounting systems
 Inventory management system

Contd...
 Job costing system
 Price-optimizing systems

Methods used for management accounting
reporting
• Job cost reports
 Inventory management reports

Contd....
 Operating budget reports
 Account Receivable Aging Reports
 Performance reports

 Benefits of Management accounting
systems and their applications
 Reduce expenses
 Improve cash flows

Contd...
 Business decisions
 Enhances financial returns

Applications of management accounting
systems
 Management accounting system is mainly useful for
production department. Production department of
UCK furniture analyse the actual costs and compare
them with the budgeted costs.
 Production department uses the management
accounting system to increase the profitability of the
business.

Contd...
It is also useful for the inventory management
department.

Contd...
Management accounting system also
applies to the sales department. Sales
department helps the manager to ensure
the sales records of the furniture and also
helps in coping up the sudden rise in
demand in the market.

Evaluating of integration of MAS and
management accounting
 Management accounting system helps in generating
reports which in turn used by the management
accountant to plan and evaluate the performance
based on the reports.

Contd...
 Management accounting further helps in improving
cash flows in the business which can be done by
adopting management accounting systems in an
organisation.
 UCK furniture adopted management accounting
systems to ensure effective and efficient working in
the organisation and by enhancing the quality of
products and services it offers to its customers.

REFERENCES
izi and et.al., 2010, June. Energy-performance tradeoffs in processor
architecture and circuit design: a marginal cost analysis. In ACM
SIGARCH Computer Architecture NewsM 38, No. 3. pp. 26-36).
ACM.
Cinquini and et.al., 2010. Strategic management accounting and business
strategy: a loose coupling?. Journal of Accounting & organizational
change, 6(2). pp.228-259.
DRURY and et.al., 2013. Management and cost accounting. Springer.
Fullerton and et.al 2013. Management accounting and control practices in
a lean manufacturing environment.Accounting, Organizations and
Society. 38(1). pp.50-71.