Financial accounting focuses on providing stockholders and creditors with info.
Financial statements, uses info from past, data reliable
focuses on providing internal management with info. To
run company, focuses on future, helps fulfill responsibilities, data relevant
setting goals for company and determining how to achieve
Translate plans into
– overseeing day-to-day operations, uses product cost reports,
sales info to run daily business operations (adjust menus and marketing
– evaluating results of business operations and make
adjustment to plans to keep company on track to achieve goals, uses
performance reports to compare against budget and uses to feedback
– continuously doing this when plan, direct, and
How do management accountants fit into the company’s organizational structure?
Board of Directors –
elected by stockholders to oversee the company, non
employee (meets only periodically)
Chief executive officer (CEO) –
hired by board to manage company on a daily
Chief Operating officer (COO) –
hired by CEO for company operations like
Chief Financial officer (CFO) –
hired by CEO handles financial concerns
report to CFO, responsible for raising capital (thru stocks and
bonds) and investing funds
report to CFO, responsible for general financial accounting,
managerial accounting, and tax reporting
Internal Audit function –
required by NYSE to ensure company’s internal
controls and risk management policies are functioning properly reports to senior
exec for admin matter and to subcommittee of board of directors called
(also oversees financial statements by independent CPAs, so that
management will not bias their work)
used to work for controller but now located throughout,
they act as internal consultants or business advisors.
to have theses skills: knowledge of financial and managerial accounting, analytical skills,
business knowledge, ability to work on a team, oral and written communication
What are the ethical standards for managerial accountants?
Institute of Management Accountants (IMA) –
professional association for
management accountants to advance profession through certification, practice
development, education, and networking.
Publishes monthly general, Strategic Finance.
Issues 2 certifications: