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Communication plays an important role in the budgetary processwhether a participative or imposed budgetary approach is used. (a)discuss the differences between communication flows in these twobudgetary approaches.

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Tod Thiel
Tod ThielLv2
28 Sep 2019

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Related questions

“Budgetary Slack” occurs when

a.

the budget is so difficult to meet that employees slack-off fromwork.
b.

an authoritative, or imposed, budgeting process isused.
c.

employees ask for resources in excess of what they need, inorder to "meet" budget objectives.
d.

employees ask for fewer resources than they need in order tocontinuously improve.

True or False

1. Expenses represent the costs to purchase goods or services,whereas expenditures represent the costs of goods or servicesconsumed or expired during the period.

2. Other financing sources increase fund balance in the samemanner as revenues.

3. Budgetary accounts used in the General Fund include EstimatedRevenues, Estimated Other Financing Sources, Appropriations,Estimated Other Financing Uses, and Encumbrances.

4. An encumbrance represents the estimated future liability forgoods or services resulting from placing a purchase order orsigning a contract.

5. At the end of the fiscal year Encumbrances is closed toBudgetary Fund Balance with a credit.

You work as a Management Accounting officer in a small andmedium organization operating in either a Manufacturing, Retail,Hospitality or Construction sector with not more than fifty (50)employees and an annual net turnover not exceeding £500,000.

Management accounting plays a key role in organizations todayand therefore decision makers in the organization must understandhow to create and use good management accounting information. Intoday’s business environment, business wants to track performanceinformation that goes beyond just the cost-based information ofhistoric general ledger systems provided by traditional financialaccounting information. Good management accounting involves aresponsibility to manage a wide variety of critical managementaccounting information using management accounting system andmanagement accounting techniques such as cost-volume- profitanalysis, marginal costing and absorption costing to producerelevant management report for informed decision making.

This was the summary of the speech delivered by a conferencespeaker about the role of management accounting and managementaccounting system in an organization. The General Manager of yourorganization sees management accounting function as very crucial inproviding management information well informed decision makingwithin the organization. Knowing that you are studying managementaccounting at the HND level, the organization sponsored you toattend this conference. After this conference the Generalmanagement has asked you (Management Accounting Officer) to write areport to him covering management accounting and managementaccounting system together with different costing techniques andreporting to enable the organization implement them.

Using the above scenario and in your capacity as ManagementAccounting Officer in your organisation, continue the word reportto the General Manager addressing other issues in managementaccounting function such as budgeting and budgetary control,performance indicators and variances to bolster his/her interest tomake the management accounting function in your organisation a fulldepartment rather than a unit. The fact that management accountingsystem could enable organisations identify financial problems toenable them adopt a strategy to investigate and address them madethe General Manager determined to place much importance toestablish the department. As Management AccountingOfficer, using various relevant management accountingmaterials such as news bulletin, stakeholder reports, the YouTube,twitter, academic articles, magazine, text books, websites,journals, newspapers, and other relevant resources, your report tothe General Manager should be convincing and compelling supportedwith relevant illustrations that would generate and preserve valuefor the organisation.

Explain the advantages and disadvantages of differenttypes of planning tools that can be used for budgetary control forthe chosen scenario. This should be supported with examples andillustrations. Compare how organisations (Scenario mentioned above)such as yours should adapt management accounting systems to respondto financial problems. This should be supported with examples andillustrations (1000 words). PLEASE NO PLAGIARISM

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