Chapter 1 - The changing role of managerial accounting in a dynamic business environment. After completing this chapter, you should be able to: Define managerial accounting and describe its role in the management process; explain four fundamental management processes that help organizations attain their goals; list and describe five objectives of managerial accounting activity;...
Trang 1The Changing Role of
Managerial Accounting in a Dynamic Business
Environment
Chapter 1
Trang 2Managerial accounting is the process of
Identifying
Measuring
Analyzing
Interpreting
Communicating information
Define Managerial Accounting
Trang 3Managing Resources, Activities, and
People
An organization
Acquires Resources
Hires People
Organized set
of activities
Organized set
of activities
Decision Making
Decision Making
Planning Directing
Controlling
Trang 4How Managerial Accounting Adds Value
to the Organization
Providing information for decision making and
planning.
Assisting managers in directing and controlling
activities.
Motivating managers and other employees towards
organization’s goals.
Measuring performance of subunits, activities,
managers, and other employees.
Assessing the organization’s competitive position.
Providing information for decision making and
planning.
Assisting managers in directing and controlling
activities.
Motivating managers and other employees towards
organization’s goals.
Measuring performance of subunits, activities,
managers, and other employees.
Assessing the organization’s competitive position.
Trang 5Managerial versus Financial Accounting
Accounting System (accumulates financial and managerial accounting data in the
cost accounting system)
Accounting System (accumulates financial and managerial accounting data in the
cost accounting system)
Managerial Accounting
Information for decision
making, planning, and
controlling an
organization’s
operations.
Managerial Accounting
Information for decision
making, planning, and
controlling an
organization’s
operations.
Financial Accounting Published financial statements and other financial reports.
Financial Accounting Published financial statements and other financial reports.
Internal Users
External Users
Trang 6Line and Staff Positions
A line position is directly
involved in achieving the
basic objectives of an
organization
Example: A production
supervisor in a
manufacturing plant
A line position is directly
involved in achieving the
basic objectives of an
organization
Example: A production
supervisor in a
manufacturing plant
A staff position supports and assists line positions
Example: A cost accountant in the manufacturing plant
A staff position supports and assists line positions
Example: A cost accountant in the manufacturing plant
Trang 7The chief managerial and financial accountant is
responsible for:
Supervising accounting personnel
Preparation of information and reports, managerial and
financial
Analysis of accounting information
Planning and decision making
The chief managerial and financial accountant is
responsible for:
Supervising accounting personnel
Preparation of information and reports, managerial and
financial
Analysis of accounting information
Planning and decision making
Trang 8Responsible for raising capital and safeguarding the
organization’s assets
Supervises relationships with financial institutions
Work with investors and potential
investors
Manages investments
Establishes credit policies
Manages insurance coverage
Responsible for raising capital and safeguarding the
organization’s assets
Supervises relationships with financial institutions
Work with investors and potential
investors
Manages investments
Establishes credit policies
Manages insurance coverage
Trang 9Internal Auditor
Responsible for reviewing accounting procedures, records, and reports in both the controller’s and the treasurer’s area of
responsibility
Expresses an opinion to top
management regarding the effectiveness of the
organization’s accounting system
Responsible for reviewing accounting procedures, records, and reports in both the controller’s and the treasurer’s area of
responsibility
Expresses an opinion to top
management regarding the effectiveness of the
organization’s accounting system
Trang 10Product Design
Product Design
Research and Development
Research and Development
Strategic Cost Management and the
Value Chain
Securing raw
materials and
other resources
Securing raw
materials and
other resources
Production
Marketing
Distribution Distribution
Customer
Trang 11Theoretical Capacity is the upper limit on the amount
of goods or services if everything works perfectly.
Practical capacity allows for normal occurrences such
as cash register downtime and cashier fatigue or illness.
Trang 12Cost Management Systems
Objectives
Measure the cost of
resources consumed.
Identify and eliminate
non-value-added costs.
Objectives
Measure the cost of
resources consumed.
Identify and eliminate
non-value-added costs.
Cost Management System
Trang 13Cost Management Systems
Objectives
Determine efficiency
and effectiveness of
major activities.
Identify and evaluate
new activities that can
improve performance.
Objectives
Determine efficiency
and effectiveness of
major activities.
Identify and evaluate
new activities that can
System
Trang 14Managerial Accounting as a Career
Professional Organizations
Institute of Management Accountants (IMA)
Publishes
Management
Accounting
and research
Publishes
Management
Accounting
and research
Administers
Certified Management Accountant
Administers
Certified Management Accountant
Develops Standards of
Ethical Conduct for Management
Develops Standards of
Ethical Conduct for Management
Trang 15Ethical Climate of Business
The corporate scandals experienced over the last few years have shown us that unethical behavior in business
is wrong in a moral sense and can be disastrous in the economy In addition to Sarbanes-Oxley, there will likely be more reforms in corporate governance and
accounting.
The corporate scandals experienced over the last few years have shown us that unethical behavior in business
is wrong in a moral sense and can be disastrous in the economy In addition to Sarbanes-Oxley, there will likely be more reforms in corporate governance and
accounting.
Trang 16Professional Ethics
Competence Confidentiality Integrity
Credibility