Management Accounting System and its Essential Requirements in Business

MANAGEMENT
ACCOUNTING

INTRODUCTION
 Management accounting is the systematic presentation of
financial activities in such a manner that provides useful
information to manager in taking rationale decisions.
The purpose of this accounting is to assist internal
management in forming policies and strategies. The
present report will cover meaning, advantages and
requirements of management accounting system.

P 1 MANAGEMENT ACCOUNTING SYSTEM AND
ITS ESSENTIAL REQUIREMENTS IN BUSINESS
 Management accounting
 Management accounting is a branch of accounting which
helps the management in taking managerial decision relating to the
financial position of the company.
 Management accounting system
 Management accounting system is a system of accounting which
deals with the analysing and controlling the internal system of
the business including various resources of the business are
needed to operate the regular operations of the company.

CONT..
 Requirements of management accounting system
 Management accounting system plays a vital role in the success
of the company. Each firm needs inclusion of a better management
accounting system in order to enhance its financial position over a time.
 Types of management accounting system and their requirements
 Cost accounting system, inventory accounting systems, job
costing systems, price optimization system, etc. are the various types of
management accounting systems which could be adopted by the
company in order to enhance its capacity and efficiency at various
departments of the business. Key requirements of these management
accounting system are as under:
 cost accounting system
 Cost accounting system deals with the analyzing the cost
efficiency of the business and developing plans for the company in
order to make it more cost efficient.