1. Chapter 1 Introduction to management accounting
LEARNING OUTCOMES
You should be able to:
Identify the purpose of a business and discuss the ways in which a business may be organised and managed
Discuss the issues to be considered when setting the financial aims and objectives of a business
Explain the role of management accounting within a business and describe the key qualities that management accounting information should possess
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Explain the changes that have occurred over time in both the role of the management accountant and the type of information provided by management accounting systems

2. A department structure organised according to business functions
Board of directors
Finance
Personnel
Operations
Marketing
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3. A divisional organisational structure
Central services – Information technology, Personnel, Research and Development
Board of directors
North Division
South Division
East Division
West Division
Finance
Marketing
Operations
Other
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4. The strategic management framework
Perform review and control
Select strategic options and formulate plans
Identify and assess the strategic options
Undertake a position analysis
Establish mission and objectives
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5. Relationship between risk and return
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6. Main users of accounting information relating to a business
Competitors
Lenders
Managers
Suppliers
Investment analysts
Community representatives
Government
Employees and their representatives
Customers
Owners
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7. Quantity of information
Relationship between costs and the value of providing additional management accounting information
Value or costs (£)
Quantity of information
Costs
Value
Optimal quantity
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8. Characteristics that make management accounting information useful
The characteristics that influence the usefulness of management accounting information
Characteristics that make management accounting information useful
Understandability
Comparability
Reliability
Limitation to the application of the qualitative characteristics
Cost/Benefit
Necessary for including information in the financial statements
Materiality
Relevance
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9. The management accounting information system
Information analysis
Information identification
Information reporting
Information recording
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10. Management decisions requiring management accounting information
Developing long-term plans and strategies
Management accounting information
Performance evaluation and control
Determining costs and benefits
Allocating resources
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11. Management and financial accounting
Nature of the reports produced
Level of detail
Regulations
Reporting interval
Time horizon
Range and quality of information
The major differences concern:
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