MANAGEMENT ACCOUNTING

Managerial Accounting focuses on

DEFINITION CHARACTERISTICS
providing information for use by
internal users, the management. This Industrial revolution of the 19th
HISTORY USERS: FUNCTIONS
Inside the Qualitative and Quantitative
branch of accounting deals with the century. During this early period, Organization Information
needs of the management rather most firms were tightly
than strict compliance with generally  Margin Analysis
controlled by a few owner-
accepted accounting principles.
managers who borrowed based ACCOUNTING Decision-making system
(Brances/Types of Accounting- on personal relationships and RULES:  Breakeven Analysis
AccountingVerse None
their personal assets.
accountingverse.com)  Constraint Analysis Future-Oriented
TIME HORIZON:
Future Projections
(sometimes  Target Costing
LEVEL OF No Set Format
PRIMARY TASKS/SERVICES PERFORMED BY DETAIL: historical in a
MANAGEMENT ACCOUNTANTS. Often presents detail)
The degree of complexity relative to these  Inventory Valuation
segments of an
activities are dependent on the experience Discretionary Activity
organization (e.g.
level and abilities of any one individual.
products, divisions,
• Rate and volume analysis  Trend Analysis
• Business metrics development departments)
• Price modeling WHO IS A MANAGEMENT ACCOUNTANT? TE
PERFORMANCE
• Product profitability CH
MEASURES:  Transaction Analysis  Financial Planning
• Geographic vs. industry
Theormanagement
client segment accountant designs the format of the
Financial and NI
reporting
financial and cost control reports. These reports are
• Sales management scorecards
Nonfinancial
Q
• Cost analysis presented before each level of management with the most  Capital Budgeting Financial Statement
UE
useful data at the most appropriate time. Moreover, he/she
• Life cycle cost analysis Analysis Analysis
• Client profitability analysis
educates management executives as the ways of using reports.  S
• IT cost transparency THE SPECIFIC ETHICAL
Hence, sometimes, he/she described as the Chief Intelligence Statistical and Graphical
• Capital budgeting STANDARDS FOR MANAGEMENT
• Buy vs. lease analysisOfficer of the top management. THE 3 PILLARS OF ACCOUNTING
Techniques
ACCOUNTANTS INCLUDE:
• Strategic planning 
• Strategic management advice
• Internal financial presentation and COMPETENCE Planning  Control Techniques
communication
• Sales forecasting
• Financial forecasting
CONFIDENTIALITY
Controlling  Reporting
• Annual budgeting
• Cost allocation INTEGRITY
Decision-making
CREDIBILITY