Management Accounting and Reporting Methods

Management Accounting

Table of Contents
INTRODUCTION
TASK 1
P1 Management accounting and essential requirements of its systems.......................... 1
P2 Different methods used for management accounting reporting................................ 4
M1 Importance of MAS ..................................................................................................4
D1 Integration between MAS and MA reports...............................................................4
TASK 2
P3 Calculation of cost using different costing techniques............................................. 5
M2 Techniques to prepare income statements................................................................6
D2 Interpretation of produced income statement..........................................................7
TASK 3
P4 Advantages and disadvantages of different planning tool used for budgetary control.. 10
TASK 4........................................................................................................................ 13
P5 Comparison of the way in which organisations are adapting management accounting
Systems........................................................................................................................ 15
M4 MA to respond financial problems.........................................................................16
D3 Role of planning tools to solve financial issues......................................................17
CONCLUSION
REFERENCES

INTRODUCTION
Management Accounting is known as the process in which various type of activities are tends to
be perform like analysing, observing, identifying, measuring, analysing, interpretating and
communicating .It involves all the important financial information and on the basis of that only
important steps of decision makings is tends to be perform. As various types types of related
tools are used in the company to reflect the acytual financial position of the business. These
important financial information supports the outsiders such as Banks, merchant bankers,
debenture trustee, financial institutions, Qualified institution buyers and underwriters to take
investment decision, only if the project is shown profitable than only these people ready to
deploy their funds. Financial institutions and banks give guarantee only if company is sound And
if the project has maximum chance to success than only underwriters ready to take underwriting
on behalf of the company as all these became possible due to proper Management Accounting. In
this assignment the company which is selected is Marks and Spencer. It is a famous supermarket
dealing in retail sector. The organisation was established in 1884 in the location of United
Kingdom. Steve Rove has full controlling power, it act as chief executive officer of the company.
In London it has their headquarter. In the project various topics are discuss such as management
accounting meaning along with essential requirement of various different types of MA system,
methods used for management accounting reporting, through adopting suitable technique cost
analysis are tends to be done for the purpose to prepare income statement with support of
marginal costing as well as absorption costing. Discuss merits 7 demerits of planning tools
implemented for budgetary control. In last how company follow M A system in context to
respond existing financial issues are also discuss under the assignment (Asmuni, 2020)
PART 1
TASK 1
P.1 Explain the concept of management accounting and provide essential requirement of various
types of management accounting system?

Management Accounting: MA is a broader term that all executives ought to recognize to
improve the organization in which they operate. It is a strategy that allows internal stakeholders
to assess whether or not the entity operates correctly. By help of this, all information on business
performance is captured. It is important for all organizations to make sure they pay importance to
it to meet all defined targets and objectives.
It is an activity providing financial information to top authorities in terms to do effective
decisions making that supports to fulfil the goals and targets. In the organisation finance
department of it shares different type of financial reports to the managers or executives of
different team for example, , bank statements, invoice, balance sheet, vouchers, profit and loss
statement, cash flow statement, etc, so that they can easily analyse actual financial status of
company it tends to reflect true and fair financial position and can tends to be plan for future
investments. The another name of Management accounting is called as cost accounting system,
but it tends to be differ in context to financial accounting (Bagherzadegan, 2019)
Management Accounting system: Management Accounting system is known as the financial
data which involves facts and figures which support stakeholders and financial institutions
because it reflects actual financial position of the business. With support to these system
company can easily find out their basic working capital requirement and according to needs
arrangement of funds can be done.
Types of M.A.system
To operate business in successful manner, various management accounting system which are
beneficial are adopted. Few of these are discuss as follows:
Cost accounting system: Generally it is implemented in the concern which manufactured the
product. In this types of system costing can be ascertained. Company Marks And Spencer
separate the overall cost on the basis indirect and direct cost. On the basis of following element
such as fixed, variable. Semi variable cost are tends to divided by using it and also unnecessary
expenses are tends to remove which make the product less expensive. Which results high level of
sales and revenues (Giacomini, 2020)