Detailed Management Accounting Report for Waitrose Supermarket

This report provides a comprehensive overview of management accounting, defining its principles, functions, and systems with a focus on the British supermarket Waitrose. It explores key concepts such as cost accounting, inventory management, and job costing systems, essential for financial analysis and decision-making. The report examines the essential requirements of each system and details how they are applied within the Waitrose context. Furthermore, it highlights the importance of management accounting reports, including job costing, process costing, manufacturing, and budget reports, in evaluating business performance. The report concludes by emphasizing the significance of management accounting in organizational evaluation and strategic planning, supported by relevant references.

MANAGEMENT
ACCOUNTING

Table Of Content
• Introduction
• Management accounting
• Management accounting principles
• Functions of management accounting
• Management accounting systems
• Management accounting report
• Conclusion
• References

INTRODUCTION
Management accounting is the process of examine the costs of
business and operations. In presented report selected company
Waitrose, which is a British supermarket in the form of food
retail division. It has been selected from this report consist of
management accounting definition and their principles and also
functions. Different system of management accounting and their
essential requirements have been decided. There is identified
management accounting reports which are used to present
performance of the company.

Management Accounting
According to the (Institute of cost and management
accountants, 2005) has defined management accounting, “It is
the application of professional knowledge and skill in the
formulation of accounting information in such a way as to assist
management in the formulation of policies and in the planning
and control of the operation of the undertakings. It will help the
organisation to evaluate critical accounting information which
help the manager to take decision regarding their financial
information.”

Cont...
According to the charted institute of management accountants
(CIMA), “Management accounting is the procedure of
determination, measurement, aggregation, investigation,
preparation, interpretation and communication of information
which is used by management for plan. Management accounting
help in analysis of financial information and with the help this
manager develop the strategies for the benefit of organisation”. It
is also comprised the preparation of financial reports for non
management group such as creditors, share holders, tax
department and regulatory agencies.

Cont...
According to American accounting association: “It includes
the use of appropriate methods and concepts through historical
data that will help the organisation to build plans & objectives.
Chose effective plane among the alternative business actions
will provide the control through evaluation and interpretation
of performances”.

Management Accounting Principle
• Communication – The communication is provided insight
influential for the management accounting conversations
starting and ending. It will help to improve decision making
process by communicating perceptive information at each
stages.
• Relevance - The presented information must be relevant to
performance of the company. Management accounting can
scan all best available resources for information that is
authentic for decision making.

Cont...
• Value - There is analysed impact of value on management
accounting. It is connects all organisation's strategy to their
business model. There is required to understand with the help
of wider macro economic environment.
• Trust - Stewardship builds trust. In accountability and
scrutiny make the decision making for process more objective.
Balancing short term commercial interests against ling run
value for stakeholders intensify with trust and credibility.

Functions Of Management Accounting
• Forecasting and planning - It is one of the important function
of management accounting which is provided required
information and data for provide help in short term and long
term forecasts and planning the operations of the business.
• Organising – It is organising the human and non human
resources which are directly and non directly related to the
company.
• Coordinating - It will help to management for adaptive the cost
and final accounts after preparing budgets.

Cont...
• Controlling Performance - The management accountant
helps in controlling the performance of a company after using
of budgetary control and return on investments.
• Financial analysis and interpretation - Accountant of the
company has analysed the data and represents the management
in non technical manner with the help of their comments and
suggestions.
• Communication - The management of accountant develop
effective strategies and several reports regarding to company
performance.

Management Accounting System
• Cost accounting system - It is a unique method in which the
motive is to lower down the value of cost price of a product or
a service so to earn more profit at the time of fixing selling
price. Cost accounting helps in maintaining all the cost which
involves in every activity performing at the time of
manufacturing process, maintaining project and up-to till
product launching.

Essential requirements:
1. Proper Inventory System: This system help the organisation
to save their money and reduce the each unit cost in respect of
avoid spoilage, save storage cost, avoid dead stock etc.
2. Regular and proper stock taking: Regular review of stock
will provide the exact information to manager. It helps in
identifying the requirement of inventory at the time of
production.