Management Accounting: Essential Requirements and Reporting Methods

Management Accounting

Table of Contents
Introduction .....................................................................................................................................3
Task1................................................................................................................................................3
P1 Management accounting it's essential requirements of different types of management
accounting systems.....................................................................................................................3
P2 Explain different methods used for management accounting reporting................................5
Task2................................................................................................................................................7
P3 Calculate costs using appropriate techniques of cost analysis to prepare an income
statement using marginal and absorption costs. .........................................................................7
......................................................................10
Task3..............................................................................................................................................11
P4 Explain the advantages and disadvantages of different types of planning tools used for
budgetary control......................................................................................................................11
Task 4.............................................................................................................................................13
P5 Compare how organizations are adapting management accounting systems to respond to
financial problems. ........................................................................................................................13
CONCLUSION .............................................................................................................................14
REFERENCES..............................................................................................................................15

Introduction
Management accounting can be simply be defined as an accounting tools that is fruitful
to ensure that the organisation are using the best possible use of their limited and valuable
resource. It is applied for solving a number of tasks that includes measuring, analysing and
mainly presenting their financial information to the managers to make quicker and well-
informed decisions (Jansen, 2018). Talking in context of small and medium- sized companies,
management accounting solves a number of issues that includes limited credit facilities, lack of
demand of their product or service offerings and weaker or inappropriate recording system.
Connect Catering Services, is one of the well-known caterers for fresh foods and
are family oriented in U.K. They have been successful in operating their business for the last
thirty years through their excellent quality products and services. This projects aids their
management and includes important of management accounting it's practical application by
different techniques. Adding to this, it also covers different planning tools that will support them
in solving the financial issues.
Task1
P1 Management accounting it's essential requirements of different types of management
accounting systems.
Management accounting is relevant tools and selects the most useful financial information
that are annually recorded in important financial statements that include profit and loss
account,Balance sheet and cash flow statements (Maas and et. al., 2016). It's main aim is to
improve the decision making process of the company with the ultimate aim to make their process
sustainable in order to reach their desired objectives.
Management accounting has been successful to make immense contribution and have
resulted in effective decision making. Some of it's main principle has aided diverse organization
around the world to enhance the manager's decision making capabilities and in turn contributed
significantly in increase their productivity. This principles can be elaborated in detailed for it's
better understanding.

 Influence: This is one of the critical principle. It states the influence of communication
and it's power to strengthen decision making capabilities . It states the accurate and fair
information that is useful in analysing in order to evaluate and select the best alternative
that is most appropriate to solve the specific issue that have arisen in the company. This
is done, as it integrates diverse thought process as impact of actions in one department
effects all the other department and accordingly establishes proper co-ordination and
enhances productivity of the entire organisation (Boučková, 2015). This further aids to
become authoritative due to the result of getting access to the most required information
that is useful to them.
 Relevance: Information is important for one and all. It is just that every individual and
different organization want to access the most useful information that is relevant for them
along with the individual making the decisions from all the available resources. It is
important for the decision maker to carefully understand requirement of all of their
shareholder as they are operating their business with the ultimate aim to maximize their
welfare. Adding to this point, it is important to ensure that they is a proper balance of all
the information including external and internal and financial and non financial.
 Value: It is important to predict it's value. Management accounting is capable to link it's
processes to company's model and it is important to know the demand of it's macro
economic environment. This mainly deals with carefully evaluating all the available
opportunity and grabbing the best opportunity that minimizing the risks involved and aids
to follow a pathway that leads to maximization the value of it's crucial investments . It is
important for them to undergo situational analysis in order to make best decisions by
being well informed about the market conditions specifically in their industry and
economy and adopt the same as it is vital for their survival.
 Creditability: It is very much important for improve and make the decision making
process more creditable. It is carefully evaluate the alternatives and select the most
reliable decisions. This further support the Company to fulfil the desires of the company.
It is important for management accounting experts to look towards the interest of all its
stakeholder and on a timely basis by taking regular feedbacks and addressing their
overall issues at the earliest (Gibassier and Schaltegger, 2015). It is crucial for experts of
management accounting to consider the feedbacks of all it's stakeholders in order to take