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AE 27 Lesson 1

Management accounting refers to using accounting information to assist management in policymaking, operations, and control. It focuses on future decisions and selective information for management. The objectives of management accounting are to provide information to assist with planning, decision-making, controlling, coordination, and reporting. Management accountants help perform functions like providing, modifying, analyzing, and interpreting accounting data to facilitate control.

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40 views15 pages

AE 27 Lesson 1

Management accounting refers to using accounting information to assist management in policymaking, operations, and control. It focuses on future decisions and selective information for management. The objectives of management accounting are to provide information to assist with planning, decision-making, controlling, coordination, and reporting. Management accountants help perform functions like providing, modifying, analyzing, and interpreting accounting data to facilitate control.

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Ma Terresa Tejada
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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MANAGEMENT ACCOUNTING: NATURE AND SCOPE

 Introduction
 Definition of Management Accounting
 Nature of Management Accounting
 Objective of Management Accounting
 Scope of Management Accounting
 Functions of Management Accounting
 Limitations of Management Accounting
 Difference between Management accounting and
Financial Accounting
 Difference between Management Accounting and Cost
Accounting
 Management Accounting Organization
 Management Accountant
 Functions of Management Accountant
 Management accounting can be viewed as
Management oriented Accounting.
 It shows how the accounting function can be
re-oriented so as to fit it within the
framework of management activity.
 The primary task of Management Accounting
is therefore to redesign the entire accounting
system so as it may serve the operational
needs of the firm.
 Management Accounting refers to the
presentation of accounting information in
such as to assist management to the creation
of policy and the day to day operation of an
undertaking.
 The term “Management Accounting” covers
all those services by which the accounting
department can assist the top management
and other departments in the formation of
policy, execution and control.
 Service Function – it assist management by
providing necessary information related to
accounting.
 More Concerned with Future – it is related to
future decision and are taken by analyzing
accounting information for the future.
 Selective in Nature – it provides selective
information to the management.
 It only supplies data and not a decision
 Integrated system
 To provide selective information to the
management.
 To assist in planning
 To assist in decision-making
 To assist in controlling
 To assist in coordination
 To help in reporting
 Financial Accounting
 Cost Accounting
 Revaluation Accounting
 Budgetary Control
 Inventory Control
 Statistical Methods
 Interim Reporting
 Taxation
 Office Services
 Internal Audit
 Management accounting helps in the
performance of the following functions:
1. Provides data
2. Modifies data
3. Analyzes and interprets data
4. Serves as a means of communicating
5. Facilitates Control
6. Use of quantitative andqualitative information
 Proper Planning
 Effective Controlling
 Increase Efficiency
 Maximizing Profitability
 Performance Appraisal
 Increase Productivity
 Based on Accounting Information or
Accounting Data
 Lack of Knowledge and Understanding
 Lack of Continuity and Coordination
 Very Expensive
 Time Consuming
 Based on Historical Data
 Management Accountant is a person who
assist the management in decision-making
by providing necessary accounting
information.
 The Management Accountant has a very
significant role to perform in the installation,
development and functioning of an efficient
and effective management information
system.
 Important functions of Management
Accountants:
1. Planning
2. Controlling
3. Coordinating
4. Reporting
5. Interpreting
6. Evaluation
7. Advising
8. Other Functions

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