Learning Objectives 1.Explain the meaning of management accounting. 2.Explain the difference between management accounting and financial accounting 3.Identify and explain the current focus of management accounting.
Learning Objectives 4.Describe the role of management accountants in an organization. 5.Explain the importance of ethical behavior for managers and management accountants. 6.Identify three forms of certification available to management accountants.
What is management accounting? ◙ Accounting for internal users – Managers ◙ Not bound by GAAP What are its three objectives? 1.Information for costing out services and products 2.Information for planning, control evaluation and continuous improvement 3.Information for decision making
Illustration of Management Accounting Information
Match Definitions Planning Decision Making Control Monitoring a plan’s implementation and taking corrective action Information of action to achieve a particular end Choosing among competing alternatives
Differentiate Between Managerial & Financial Accounting MANAGERIAL ◙ Internal focus ◙ No mandatory rules ◙ Financial & non-financial, subjective information ◙ Future emphasis ◙ Internal evaluation and decision making ◙ Broad multidisciplinary FINANCIAL ◙ External focus ◙ Must follow GAAP ◙ Objective, financial, historical reporting ◙ Reports for the whole firm ◙ More self-contained
What is the current focus of managerial accounting? ◙ Customer Orientation ◙ Time as a Competitive Element ◙ Efficiency ◙ The Value Chain ◙ Cross Functional Perspective ◙ Total Quality Management ◙ Strategic Positioning
Describe the Value Chain
Describe the Role of the Management Accountant ◙ Know the market ◙ Know the product ◙ Must be world class ◙ Up to date with the latest developments ◙ Know the customs of the countries you practice in ◙ SUPPORT ◙ ASSIST
Define Line and Staff Line Positions that have direct responsibility for carrying out the organization’s basic objectives Staff Positions that are supportive in nature, and only have an indirect responsibility for an organization’s basic objectives
What is ethical behavior?
Match the Certification to the Organization that Sponsors it CPA CIA CMA Institute of Internal Auditors IIA American Institute of Certified Public Accountants AICPA Institute of Management Accountants IMA