HNBS 305: Management Accounting Systems and Reporting Analysis

This report delves into the core concepts of management accounting, emphasizing its significance for effective business operations and decision-making. It explores various management accounting systems, including cost accounting, inventory management, job costing, and price optimization, detailing their functions and advantages. The report examines different types of reporting systems, such as performance reports, inventory management reports, account receivable reports, and job costing reports, highlighting their roles in controlling and managing business transactions. Furthermore, it provides a critical evaluation of these systems, analyzing their impact on organizational performance and profitability, with specific reference to UCK Furniture. The conclusion underscores the importance of management accounting in achieving organizational goals and objectives, advocating for the adoption of various accounting systems to facilitate informed decision-making and sustainable growth.

Management Accounting
PART 1

Covered content
• Introduction
• Various types of Management accounting system
• Different types of accounting reporting
• Benefits of using MA system
• Critical evaluation of reporting
• Conclusion
• References

Introduction
Management accounting is an essential aspect for every
business enterprise. This will assist managers to manage and
control their daily operations in more effective manner. This
project provides crucial information about various
management accounting systems and their valuable
requirements in future decision making.

Management accounting systems and their
essential requirements
Every organization in a manufacturing business lot of issues
takes place with regards to accounting and finances. For a Raw
material to become a finished goods, it has to go from various
processes and at every process accounting of all the transactions
is necessary to have the knowledge whether it is profitable or not
for a company to operate those processes. Accounts are usually
prepared as per the guidelines and standards set by the
accounting boards of concerned country.

Types of MA system
Some of the accounting systems are described as below :
Cost accounting System : A proper Cost accounting system
helps in estimation of total cost of various products to be
produced. Some other functions of cost accounting system
includes management and control of cost, valuation of
inventory and evaluation of profits.

Inventory Management
It is a system of controlling cost of inventory and overall
management of quality and quantity of inventory. Inventory
usually includes Raw material, Work in progress and
Finished Goods. This accounting system also take care of
analysing various inventory levels which includes
minimum, maximum and normal inventory level.

Job costing system
Under this type of costing, The overall cost of Production is
allocated to an individual products or a batch. These types
of costing is applied where the goods produced are not
identical to each other and therefore cost can be allocated to
them separately. It comprise of all routine with regards to
gathering data on the costs related to a particular
administrations or assembling work exercises.

Price Optimisation system
It is a system of numerical evaluation, it is used by
organizations to estimate the perception of customers about
a particular product of company and what is the price which
is expected by them. 'UCK Furniture' uses this system to
analyse consumer behaviour and demand pattern for their
furniture products.

Different types of reporting systems used in an
organisation
In every manufacturing sector, it has been seen that they
are not able to make record of their financial transaction in
proper manner. In order to control and manage their daily
business transaction a well effective reporting systems
should be use by the account managers to control any losses.

Types of reporting system
Some of them are discuss underneath:
• Performance report: It is basically done by the
company to make use of past data in order to analyse
current year performance. This is most done to
determine whether are performing well in order to
generate better outcomes during the year.

Inventory management report
This report is mostly done to manage and control their stock
position that are incurred during the time. These can be done
by recording opening and closing inventory that are being
occur at that period of time. Some effective tools are ABC
costing, Inventory turnover as well as EOQ.

Account receivable report
Such kind of reports are prepared by the mangers in order to
determine total lists of unpaid customers and credit amounts
those are still outstanding. It is a legal enforceable claims for
making payment those are held by a business for products
supplied to the customers.