ACCG100 Lecture Notes - Lecture 9: Management Accounting, Financial Statement
1 Sep 2018
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Department
Course
Professor
Week 9: Introduction to management accounting and budgeting
Management accounting vs financial accounting
Management;
- The process and techniques that focus on the effective and efficient use of
organisational resources to support managers in their tasks of enhancing both
customer calue and shareholder value
➔ Internal focus
➔ Users? Management, internal users
➔ Type of report? Internal reports
➔ Frequency of reports? As need arises
➔ Purpose of reports? Specific information, specific purpose (planning,
controlling, directing and motivating)
➔ Content? Subunits of entity, any type of relevant data
➔ Verification? None
Financial;
- Process of identifying, measuring, recording and communicating economic
transactions and events of a business operation
➔ External focus
➔ Users? External, customers, shareholders
➔ Type of reports? Classified financial statements
➔ Frequency? Of reports? Quarterly, half yearly, annually
➔ Purpose of reports? General information for all users
➔ Content? Entity as a whole, double entry, accounting principles
➔ Verification? Audits
Management functions
- Planning : looking ahead and establishing short-term and long-term objectives
- Directing and motivating : implementation of plans by coordinating diverse activities
and human resources
- Controlling : process of keeping entity’s activities on track
Management cost concepts
Cost information is crucial for the planning, control and evaluating functions performed by
management. Having accurate and timely information relating to costs enables an assessment
to be made of the efficiency and effectiveness with which the entity’s scarce economic
resources have been managed.
What are costs?
- Resources given up to achieve a particular objective
- Measured in monetary terms $$
Document Summary
Week 9: introduction to management accounting and budgeting. The process and techniques that focus on the effective and efficient use of organisational resources to support managers in their tasks of enhancing both customer calue and shareholder value. Specific information, specific purpose (planning, controlling, directing and motivating) Subunits of entity, any type of relevant data. Process of identifying, measuring, recording and communicating economic transactions and events of a business operation. Entity as a whole, double entry, accounting principles. Planning : looking ahead and establishing short-term and long-term objectives. Directing and motivating : implementation of plans by coordinating diverse activities and human resources. Controlling : process of keeping entity"s activities on track. Cost information is crucial for the planning, control and evaluating functions performed by management. Having accurate and timely information relating to costs enables an assessment to be made of the efficiency and effectiveness with which the entity"s scarce economic resources have been managed.
