HI5017 Managerial Accounting: Case Study and System Analysis Report

This report provides a comprehensive analysis of managerial accounting systems (MAS), focusing on a case study of a multinational manufacturing company. It identifies and explains key management accounting techniques like Activity-Based Costing (ABC), Balanced Scorecard (BSC), and Total Quality Management (TQM). The report assesses the relevance of MAS in contemporary organizations, supported by evidence from the case company and a comparison with another journal article. It highlights the importance of MAS in cost control, performance measurement, and strategic decision-making. Furthermore, the report provides practical outcomes and lessons learned from the research findings, offering valuable insights for management accountants in Australian companies. The analysis underscores the significance of MAS in enhancing business performance and adapting to a competitive environment. The report also discusses the importance of techniques like ABC, JIT, Kaizen, TQM, and Six Sigma in improving management performance.

Managerial Accounting

Abstract
The management accounting system is considered to be the system through which the accounting
of the company’s financial information and the assets are done. The internal system that the
organisation uses so as to measure and achieve the desire of management in the company.
Through this system the managers of the corporation are able to take the decision and fulfil the
objective of maximising the Functioning of the corporation. there are various models of defining
the MAS which is discussed in this report. The current report is based on the case study of the
modern management accounting system which is implemented by the various manufacturing
corporation in the country. In this report the analysis of the diverse types of management
accounting system would be done. Also, the evidence from the case corporation would be
discussed so as to achieve the objective of understanding the management accounting systems.

Contents
Managerial Accounting...................................................................................................................1
Abstract............................................................................................................................................3
Main body........................................................................................................................................4
1. Identify any three (3) specific examples of the different types of management accounting
methods and/or techniques from the case....................................................................................4
2. Are MAS relevant to contemporary organisations?................................................................5
ii) Compare and contrast this finding with one other journal article you will need to find that
has discussed about management accounting systems in another real-life corporationor
companies. Did this second study have similar findings as the first chosen article, or mixed
and/or different findings?............................................................................................................7
3. What conclusions do you make about the relevance of MAS in today’s competitive and (in
most cases), uncertain business environment?............................................................................8
4.Provide four (4) specific outcomes or lessons learned from each of the two articles’ research
findings that will be useful for management accountants in Australian companies to learn
from, and justify your answer......................................................................................................9
Conclusion.....................................................................................................................................11
References......................................................................................................................................12

Main body
1. Identify any three (3) specific examples of the different types of management accounting
methods and/or techniques from the case.
A contemporary accounting method is used by various companies in the world so that they are
able to maximise the performance of the internal management of the company. The management
accounting method is used to analyse the profitability of the firm and the depict the cost of the
item that they sell in the marketplace. The benefit that is given to the employees of the
corporation can be depicted by the management accounting technique (Bobryshev, et. al., 2015).
According to the author of the article, there are various accounting techniques that are various
accounting techniques as defined in MAS. Some of these techniques include Activity-based
costing (ABC), Balanced Scorecard (BSC), Just in time (JIT), value chain analysis (VCA), Total
quality management (TQM). These techniques help in bringing the insights of the accounting
which are related to the management of the cost of the company. these are described in brief as
below:
 ABC Analysis: This is the approach which is used for the purpose of classifying the
inventory items which are based on the consumptions. The consumption value is used to
depict the entire value of the item that is spent over a period of time. This is the method
that is founded on the Pareto principle where the management uses matters and its
implications for this purpose. Here in this approach the classification is made on the basis
of the items that are having the highest consumption to the articles that are having the
lowest consumptions. The approach is used in the manner where the highest used or the
highest turnover inventory is classified on the basis of ‘A’. the inventory that is interclass
is classified on the basis of ‘B’. while the article or the product of the corporation that has
the lowest consumption are classified on the basis of ‘C’. The business in the industry is
not always same and the ups and downs come on various occasions. This helps in
maximising the performance of the corporation as a whole. As in the article, it specifies
that this tool helps the organisation to achieve the actual cost management accounting
technique so as to check the volumes of the product that are rapidly sold in the market
and those which are not at all sold in the market.

 BSC analysis: it is the scorecard that is used for the purpose of analysing the
performance of the company. The performance metrics is one of the most used method
for the purpose of strategic management of the corporations that the improvement can be
made for the various inner as well as the external function of the commercial. This is
used by the management of the corporation to attain the objectives, measurements and
initiatives so that the goals of the corporation can be achieved. Through this the
companies can easily identify the factors that are affecting the business of the company.
while in the research this is specified by the researcher that the use of BSC analysis has
fundamental unnecessary as this is not used by the companies in their daily routine work.
 TQM: it is the approach that is used by the different organisation so that the structured
approach is taken for the purpose of management in the organisation. there has been a
focus on the process where it helps in refining the quality of the product that the
corporations selling to its customers. through this approach both the internal as well as
the external policies of the corporation are being identified. Consumer-focused process
which aims to improve on the quality of the product. This technique strives to ensure that
all the associated employees work in a way that the common goal of the corporations
achieved.
These are the management accounting techniques that are identified in the case study of the
multinational manufacturing corporation (Chenhall and Moers, 2015).
2. Is MAS relevant to contemporary organisations?
The onset of globalised competition in the market is the key which is regarded as the corporation
to change the way of there working. The management accounting plays an important role in the
basic management of the events in the country and through this the corporations able to
maximise the performance of planning the requirements and decision making in the country. this
is important for the companies that are working in the country to implement the management
accounting resources through which they are able to maximise the performance of the
corporations (Jamil, et. al., 2015). The management accounting principles helps in getting the
knowledge of the cost that is related to them. Through this the managers of the corporation are
able to find the deviation that is in the budgeted and the actual performance of the corporation
and take the corrective action so as to fulfil and ensure that the efficient and effective

management is performed by the corporation for the same. The management accounting is to be
important for the contemporary organisation so that they are able to maximise performance.
i) What evidence is there from the case company?
In the present context that the management accounting tools help in providing timely and
accurate information through which they are able to control the cost that is related to the product
of the company. Also, through this they are able to measure the pricing that is related to the
particular product of the company. this helps in making the decision through which the
corporation are able to make the strategies of launching the new products in the market and
decide the price which is beneficial for the corporation for this purpose of the issue (Klychova,
et. al., 2015).
As this is in the case study that the contemporary management tools which include the ABC
analysis helps the corporation to achieve the cost management accounting practice and also this
helps in allocation of the funds to the different activities and the cost that is related to the
particular file are transferred on the other field for the same. Through the implementation of the
ABC analysis in the modern manufacturing corporation bring several changes which include that
better performance can be identified from the day of the implementation. Also, the corporations
able to identify the stock that is used at the maximum level of time and the stock that is used at
the minimum. Through which they are able to reduce the cost of the corporation that is expended
on the management of stock of the company. The ABC analysis is to be having superiority over
and above the traditional way of costing and this is that the with the implementation of the ABC
analysis in the business organisation they are able to get the result that they have never got
before for the company. the companies in the fortune 500 groups if which around 51% of the
companies adopted the method of ABC in their inventory management and this was founded that
ABM models are to be sustained where the implementation of the model was used for more than
the expected time frame which includes four years’ time (Maas, et.al., 2016).
On the other hand, the research that the implementation of the management accounting technique
is broadly and specifically utilised by various industry in the world. on the other hand, the
implementation of this technique is a costly process but it helps in getting the understanding of
the same at the higher level. This technique helps in making the strategic management in the

company. this helped the companies in the manufacturing sector to reduce the cost and make the
best decision for the purpose of making it implemented.
ii) Compare and contrast this finding with one other journal article you will need to find that has
discussed management accounting systems in another real-life corporation or companies.
Did this second study have similar findings as the first chosen article, or mixed and/or
different findings?
In another journal that is taken into consideration which is related to the management accounting
helped in getting the insight of the management accounting. By comparing both the journals that
were based on the manufacturing companies it was identified that both the journal provided the
same conclusion that the management accounting technique is a better solution than any other
process of doing the accounting in the corporation (Malmi, 2016). The techniques that are
involved in the management accounting which includes the ABC analysis, JIT, Kaizen, TQM,
six sigma approach and various other forms of the management accounting through which they
are able to maximise the performance of the management in the company. the common finding
that has been found in the journals includes that these techniques are becoming trending in the
recent year and most of the manufacturing the companies are implementing the management
accounting tools for better performance. through this the corporation are able to identify the cost
and the price that the corporations expending extra and which is of no use to the corporation
(Maskell, et. al., 2017). Also, through this process the corporation are able to detect the poor
system in the accounting and are also able to correct the performance. the budgeting techniques
can be identified by the corporation through the management accounting tools and also the
corporations able to make the budget standard so that the actual performance can be compared
and the deviation can be identified from the same.
Here in both the journals, management accounting is critically analysed and evaluated. The
advantages and the disadvantages of management accounting were identified for this purpose
(Mirzaey, et. al., 2017). Here in both the journal the example of manufacturing corporation was
taken which implement the management accounting principles in the corporation through which
they are able to reduce the cost and are able to perform the function of evaluation of the
strategies that are framed by them. the evidence that has been collected in the journal suggests
that a complete and the contemporary management accounting system is utilised to the fullest in
the corporation then it would lead to maximising the performance of the company. this is that

the role of the management accounting is to develop and provide the relevant information to the
management of the corporations that they are able to make the use of the information in the
effective management and planning of the activities so as to reduce the cost and the control the
activities that are hampering the effectiveness of the corporation(Senftlechner and Hiebl, 2015).
3. What conclusions do you make about the relevance of MAS in today’s competitive and (in
most cases), uncertain business environment?
The management accounting comprises the designing and the use of the accounting that is used
in within the organisation. The management accounting cannot be observed as a set of secure
rules. Here the management accounting uses the mixed approach so that they are able to
maximise the performance of the same. Management accounting smears in both the real-time
and in at the fixed instances. This can be classified that the management accounting is the
scheme through which the amount and the assortment of the financial and the functional
information can be achieved (Nguyen, et. al., 2017).
As the business in the current world is being uncertain and is having various variances due to
which the business owners are not able to make the strategies and identify the cost that is
relevant to them and which are not. The management accounting the bridge between the finance
department of the corporation and the other parts of the business. There are certain elements on
the basis of which the management accounting is based which includes pricing, budgeting,
unregulated reporting as a matter. Through the procedure of management accounting system, the
long-term success in the organisation can be achieved and nurtured. Through the management
accounting practice, the management of the corporations able to ensure that the pricing and the
budgeting techniques are utilised in the best possible manner (Otley, 2016). management
accounting is dissimilar from the monetary accounting. There are various roles in management
accounting in the organisation. some these includes the following:
 Helping in forecasting the cash flows: Predicting the cash flows of the corporations one
of the most important tasks which helps the corporation to maximise the performance.
through this the corporations able to identify the cost that the corporation would be
incurring to secure the future of the company. Also, they would be able to get the
information on from where the income of the corporation would be coming and where it
would be allocated.

 Understanding the performance variance: through this, the management of the
corporations able to understand the variance in the performance of the company. Here the
management accounting would use the analytical techniques which help in getting the
information about positive as well as the negative impact of different cost on the
company.
 Analysis of the rate of return: Through the management accounting system the
corporations able to determine the cost of the project that requires heavy investment.
Also, through this system, the corporations able classify the ROI of the investment that
would be made by them. this helps the corporation to maximise the performance and
choose the most profitable investment (Schaltegger and Burritt, 2017). through this the
corporations to protect the extra cost that they incur on the investment that is not
profitable for the company.
4.Provide four (4) specific outcomes or lessons learned from each of the two articles’ research
findings that will be useful for management accountants in Australian companies to learn
from, and justify your answer
The management accounting is unique and the most important tools that are used by the
corporations that they are able to recognize the cost of the creation and various other strategical
analysis (Quattrone, 2016). The outcomes from the two journal that were developed included the
following:
 The management accounting system is implemented in the corporation then it would help
the corporation to recognize the cost and maintain the cost at the certain level so that the
variances in the cost from the standard can be identified.
 The management accounting system is all connected to the internal system analysis and it
does not have the emphasis on the external performance of the company. it lacks the
basic criteria of external environment evaluation for the purpose of making the strategies
 The journal that is reviewed specifies the different approach for management accounting
that can be used by the manufacturing industry. These tools help in getting the
information and the specification about the internal and the external specification of the
company.

 Through the management accounting tools the organisation can achieve the objective of
getting the understanding of the cost and the variance that is occurring in the operations
of the company. which helps in reducing the cost that is related to production.
 Also, the employees of the corporation get motivated through this management
accounting tools.
Through another journal, this was seen that,
 Management accounting is a myth for the purpose of accounting and it provides the
information to the decision-maker where they enjoy a very wide aspect for the purpose of
decision making.
 the management accounting system is a costly project and the accountants and the
mangers of the corporation must take into consideration the best technique that will be
suitable to the corporation for the purpose of achieving the targets.

Conclusion
The above discussion helps in concluding that every successful organisation that is working in
the country is having management accounting system. These systems ensure that all the
accounting, as well as the related activities, are going properly and as per the plan that was made
by the management of the company. Here in this report two journals were taken that were related
to the management accounting system. Therefore, concluded from the above that the
management accounting system helps in getting the information through which they are able to
reduce the effective cost of the corporation and manage the other related activity at the fullest
with the objective of the company.

References
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