management accounting

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Cost Accounting

A branch of accounting that observes and calculates the actual costs of a company's operations. Internal managers, rather than auditors, use cost accounting most of the time to identify aspects of their company where costs can be cut. For example, a manager may enlist a cost accountant to determine the most expensive aspects of his/her business that is, where the money goes. The accountant may make a detailed report so that the manager may make decisions based upon it. Because cost accounting is primarily internal, it need not conform to the Generally Accepted Accounting Principles. It is also called managerial or management accounting. See also: Assurance, Activity-based costing.
Management accountingclick for a larger image
Fig. 53 Management accounting. Trading results: Y Company Plc for year ending 20xx.

management accounting

any accounting activities geared to the preparation of information for managers to help them plan and control a company's operations. Management accounts generally provide more detailed information than financial accounts; for example, breaking down revenues and costs between different products, factories or departments to provide comparative data and to help reveal profitable and unprofitable activities. Management accounts also tend to provide information about performance more frequently than financial accounts, with monthly or even weekly management accounts rather than annual financial accounts, to give managers prompt feedback and to enable them to act quickly to check inefficiencies. Management accounts are geared to estimates of future costs and revenues rather than simply reporting past revenues and costs as financial accounts do, thereby ‘providing valuable management information for preparing accurate estimates and tenders and for use in negotiating price changes.

Fig. 53 shows how more detailed analysis of revenues and costs can provide more useful information than total information as reported in the PROFIT-AND-LOSS ACCOUNT. Compare FINANCIAL ACCOUNTING. See also BUDGETING.

management accounting

any accounting activities geared to the preparation of information for managers to help them plan and control a company's operations. Management accounts generally provide more detailed information than financial accounts, for example, breaking down revenues and costs between different products, or factories or departments to provide comparative data and to help reveal profitable and unprofitable activities. Management accounts also tend to provide information about performance more frequently than financial accounts, with monthly or even weekly management accounts rather than annual accounts, to give managers prompt feedback and to enable them to act quickly to check inefficiencies. Compare FINANCIAL ACCOUNTING.
References in periodicals archive ?
Responsibility accounting is a mix of cost accounting and managerial accounting. In an organizational structure, the core of the organizational activity is cost accounting, from the basic recording of financial transactions to generating complex cost reports.
Teitz, Managerial Accounting, Fourth Edition, Pearson, 2014.
CA-Cost/Advanced An intermediate-level course covering Managerial Accounting the managerial use of accounting data to assist managers in their plans and decisions regarding resource allocation, organizational control, and performance evaluation.
H2.2: An accounting major who performs better in a managerial accounting course is more likely to be a better performer in other managerial accounting courses.
The design of a podcast/vodcast assignment for an Accounting Information Systems class and for a Managerial Accounting class is discussed.
Related to the topic of process costing in a managerial accounting course, Pariseau & Kezim (2007) found that using case studies in a technical business class had a significant positive impact on the student learning environment.
The paper is not written to provide a detailed lesson plan on the integration of accounting concepts into a strategic plan, but it illustrates one attempt to integrate managerial accounting into other areas of a plan.
and George Foster (2006), "Managerial accounting," Arc.
Abstract: The paper is structured in three main parts: the first part regarding to introductive information: .fundamentals, qualitative characteristics and the users of managerial accounting; the second part describes the methods used by managerial accounting in strategic management, and the third part refers to the influence of managerial accounting in strategic management and conclusions.
UAFS Business Dean Steve Williams said Baldwin has taught accounting courses for more than 20 years and has expertise in teaching cost and managerial accounting.
These men were perhaps some of the best educated men of the period, especially in the areas of engineering and managerial accounting, and they introduced these innovative principles in the firms they served.
He has taught a wide range of courses on financial accounting at the undergraduate and graduate levels, he also teaches introductory courses, advanced financial accounting and the university's managerial accounting class in the MBA program.