{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

MBA642 Ch 1-9 lecture notes

MBA642 Ch 1-9 lecture notes - CHAPTER 1 THE CHANGING ROLE...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
1 CHAPTER 1 THE CHANGING ROLE OF MANAGERIAL ACCOUNTING IN A DYNAMIC BUSINESS ENVIRONMENT Key Lecture Concepts 1. ORGANIZATIONS Types of organizations include manufacturers, retailers, service providers, agribusinesses, and nonprofit firms. These organizations have goals—for example: growth, profit, quality, leadership, etc. Organizations have information needs in the financial, production, personnel, environmental, and legal areas. Managerial accounting provides some of this information. Managerial accounting is the process of identifying, measuring, analyzing, interpreting, and communicating information in pursuit of an organization's goals. The role of managerial accountants has expanded in recent years. Formerly in staff positions, managerial accountants now serve as internal business consultants, trusted advisors, and "business partners." Management functions performed within an organization can often be summarized as decision making, planning, the directing of operational activities, and controlling. Decision making— the process of choosing among available alternatives Planning— developing a detailed financial and operational description of anticipated operations Directing operational activities— running the organization on a day-to-day basis
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
2 Controlling— ensuring that the organization operates in the intended manner to achieve its goals 2. HOW MANAGERIAL ACCOUNTING ADDS VALUE Provides managers with information (e.g., product costs, budgets, cash flows). The information includes financial and nonfinancial data to help managers with strategic planning and decision making. Assists in directing and controlling (analyzing and comparing actual performance to budgeted plans; attention-directing to highlight successful or problem areas). Motivates managers to achieve the organization's goals by communicating the plans, providing a measurement of how well the plan was achieved, and prompting an explanation of deviations from plans. Motivation is achieved, in part, through employee empowerment— the concept of encouraging and authorizing workers to improve operations, reduce costs, and improve product quality and customer service. Measures performance not only for the entire organization, as in financial accounting, but also for many subunits (divisions, departments, managers). Assesses the organization's competitive position in the rapidly changing business environment. Looks at how well the firm is doing internally, in the eyes of its customers, from the standpoint of innovation and continuous improvement, and financially. The preceding factors are integrated in a model of performance evaluation known as the balanced scorecard.
Background image of page 2
3 3. MANAGERIAL VERSUS FINANCIAL ACCOUNTING Financial accounting is intended for external users (investors, creditors, etc.); is heavily regulated by the FASB, SEC; is mandatory for publicly- traded companies; is historic in nature. Managerial accounting
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Page1 / 52

MBA642 Ch 1-9 lecture notes - CHAPTER 1 THE CHANGING ROLE...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon bookmark
Ask a homework question - tutors are online