week 9- intro to management accounting

week 9- intro to management accounting - Chapter 13-...

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Chapter 13- Introduction to Management Accounting MANAGEMENT ACCOUNTING BASICS Provides economic and financial info to managers and internal users It applies to: - All types of businesses: service, merchandising and manufacturing - All forms of business entities: sole proprietorship, partnerships and companies - Profit and non-profit organisations Similarities to financial accounting Differences to financial accounting Deals with economic events of entity Results of economic events need to be quantified and communicated to others Companies often unwilling to disclose commercially sensitive information Reports are internally generated, as often as the need arises Special purpose reports, for specific needs Contents of report not governed by financial report standards Reports not verified by external auditors Financial Accounting Management Accounting Main users of reports External Internal Types and frequency Classified financial statements, issued quarterly, 6-month or annually Internal reports, issued as frequently as the need arises Purpose of General-purpose info for all users Special-purpose info for a particular user for a specific reason Focus Entity as a whole Highly aggregated Subunits of an entity May be very detailed Content Limited to accounting system and cost data Reporting standard is generally acceptable accounting standards May include any type of relevant data Reporting standard is relevance to decision making Verification process Annual independent audit by external auditor No independent audits Ethical standards for management accountants - Professional bodies of accounting (ICAA and CPA) has a Code of Conduct
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week 9- intro to management accounting - Chapter 13-...

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