Management Accounting Systems: Enhancing Decision Making at Prime

This presentation provides an overview of management accounting, defining it as a process of planning and directing financial and non-financial aspects of an organization toward its goals. It focuses on Prime Furniture, a UK-based company, and explores different management accounting systems lik...Read More

Management Accounting (Task 1)

Table of contents
 Introduction
 Management accounting.
 Different management accounting systems
 Benefits and application of management accounting system.
 Conclusion
 References

Introduction
Management accounting can be defined as a process
of planning and directing financial as well as non-
financial aspects of an organisation in the direction
of the goals of a company. It assists directors in
taking various decisions for an organisation. The
company chosen in this report is Prime Furniture. It
is a UK based dormant company with registered
office in Birmingham. It was established in the year
2019. There is only one director of the firm- Mr.
Haider Ali.

Describe management accounting along with the
requirements of different management accounting
systems.
Management accounting refers to the practice
of recognising, analysing, explaining and
informing about the financial information to
the managers, so that it can be used for
attaining organisational goals. Its main aim is
to guide directors of Prime furniture about the
internal scenario of organisation so that
decisions could be made with full knowledge

Continued…
Principals of management accounting
 Relevance
 Principal of causality
Roles
 Management accounting system is a process of identifying, measuring and analysing the
financial information so that efficient decisions can be taken for achieving the goals of
organization. It also focuses on preparing reports for external party users along with assisting in
tracking cost linked with manufacturing of goods and services, analysing budgets etc. In Prime
furniture, it helps the managers in determining the costs of different processes and controlling
it.

Management accounting system
Management accounting system is a process of identifying, measuring and analysing the financial
information so that efficient decisions can be taken for achieving the goals of organisation (Datar and Rajan,
2018). It also focuses on preparing reports for external party users along with assisting in tracking cost
linked with manufacturing of goods and services, analysing budgets etc. In Prime furniture, it helps the
managers in determining the costs of different processes and controlling it.There are various types of
systems in management accounting that Prime furniture can employ-
 Cost-accounting system
 Inventory management system
 Job-costing system-
 Price-optimising system

Benefits and application of management accounting
system
There are various benefits of this system for Prime furniture along with its applications.
 Cost-accounting System
 Inventory management System
 Job-costing System
 Price-optimising System-

Conclusion
It can be concluded from the above PPT that management accounting is very important aspect for
the success of firm . It includes number of indicators which provides knowledge about the
performance of business. There are number of techniques which constantly tracks the costing and
inventory management policy of company so that corrective actions can be taken in time. Number of
reports made in this system guides them about the variance in budgets and tools with the help of
financial problems occurring in institution can be solved.

References
 Ryu, S.L. and Won, J., 2018. The relationship between competitive advantage and the value relevance
of accounting information. International Journal of Trade and Global Markets. 11(1-2). pp.118-126.
 Sedevich-Fons, L., 2019. Accounting and quality management: the accounts payable function under
ISO 9000. Business Process Management Journal.
 Simonova, S., 2019. THE BASICS OF KEY PERFORMANCE INDICATORS. In RUSSIAN
ECONOMY: GOALS, CHALLENGES AND ACHIEVMENTS (pp. 298-300).
 Swiatek, C., 2019. European academic libraries Key Performance Indicators (KPI): How comparison
helps decision making. Performance Measurement and Metrics.

Thank You