Management and Organizational Studies 1023A/B Lecture Notes - Management Accounting, Making Money, Cost Driver
DepartmentManagement and Organizational Studies
Course CodeMOS 1023A/B
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Jan 30 – Management Accounting
- Focuses on the internal users in the firm.
External Decision Makers
–Statements based on a format, standards, specific rules
Internal Decision Makers
–Reply to anyone in the company that need information for whatever reason
–Not limited to accountants: can be for anyone from entry-level to executive
decisions to make short-term or long-term decisions. eg. Long term: should
the factory close?
–Qualitative information as well as quantitative. As opposed to External
accounting, in management accounting, qualitative factors are often as
important as the quantitative
–No rules – standards are made so the company can do the best that it can
Processes of Management
–Even if you are an accountant, you will always have some function of control
over your job.
–Regardless of what area you are in, some, if not all of the processes of
management will be used.
Planning – often 3-5 years
–A strategic initiative is often unreachable.
–Planning supports the strategy.
1. Identify alternatives
2. Select alternative – based on what your resources are.
3. Develop budgets – take the lofty, long term strategy, break it down into
more manageable pieces.
Directing and Motivating
–Everyday activities – working towards achieving the budget goal
–Who does the work? How do I schedule work? How do I deal with work
–Executive team often delegates work to other people in a 'lower' position.
Hierarchy – direct manager of the department often handles day-to-day
–Feedback measures by taking information
–Could be qualitative
–Questioning if resources are in the right place, motivating people, putting
people in the right jobs.
–Non-profit organizations often do not have time to determine this
*Comparison of Financial and Managerial Accounting
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