...CHAPTER 1 THE CHANGING ROLE OF MANAGERIAL ACCOUNTING IN A DYNAMIC BUSINESS ENVIRONMENT Learning Objectives 1. Define managerial accounting and describe its role in the management process. 2. Explain four fundamental management processes that help organizations attain their goals. 3. List and describe five objectives of managerial accounting activity. 4. Explain the major differences between managerial and financial accounting. 5. Explain where managerial accountants are located in an organization, in terms of formal organization, deployment in cross-functional teams, and physical location. 6. Describe the roles of an organization's chief financial officer (CFO) or controller, treasurer, and internal auditor. 7. Briefly describe some of the major contemporary themes in managerial accounting. 8. Understand and explain the concepts of strategic cost management and the value chain. 9. Understand the ethical responsibilities of a managerial accountant. 10. Discuss the professional organizations, certification process, and ethical standards in the field of managerial accounting. Chapter Overview I. The Management Process in Organizations A. What is managerial accounting? B. Management activities 1. Decision making 2. Planning 3. Directing operational activities 4. Controlling II. How Managerial Accounting Adds Value to the Organization A. Provides information...
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...Definition of managerial accounting -- The process of preparing management reports and accounts that provide accurate and timely financial and statistical information required by managers to make day-to-day and short-term decisions. Unlike financial accounting, which produces annual reports mainly for external stakeholders, management accounting generates monthly or weekly reports for an organization's internal audiences such as department managers and the chief executive officer. These reports typically show the amount of available cash, sales revenue generated, amount of orders in hand, state of accounts payable and accounts receivable, outstanding debts, raw material and inventory, and may also include trend charts, variance analysis, and other statistics. Also called managerial accounting. Management accounting is a profession that involves partnering in management decision making, devising planning and performance management systems, and providing expertise in financial reporting and control to assist manage- ment in the formulation and implemen- tation of an organization’s strategy. Management accounting’s essential compo- nent is the formulation and implementation of strategy to help an organization succeed. Role of managerial accounting and the management accountant in a business or organization --- Managerial accountants record financial information for their companies that is used by the organization’s management team to aid in the decision-making process...
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...Managerial Accounting 12/3/15 Managerial Accounting Accounting is a crucial part in running a business. There are various forms of accounting that can be used, it is very important to know which technique is best to use for what companies. Once you figure out a particular technique to use, it is important to keep an open mind if there are any changes that need to take place in the business. By keeping an open mind helps the business adjust and be able to make the right decisions. Every business wants to make a profit; accounting is an important part in helping understand how profits and expense amounts are derived. One form of accounting I will focus on is managerial accounting or also known as management accounting. Managerial accounting is the process of identifying, analyzing, recording and presenting financial information that is used for internally by the management for planning, decision making, and control. Managerial accounting provides economic and financial information for managers and other internal users (Managerial, 2005). When you tell people about managerial accounting, the first thing they ask is “What’s the difference between managerial and financial accounting?” There are both similarities and differences between managerial and financial accounting. The major similarity each field shares, is that they both deal with the economic events of a business. As an example, determining the unit cost of manufacturing a product is part of managerial accounting...
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...Nature of Management © 2008 Prentice-Hall Business Publishing Learning Objectives After studying this chapter, you should be able to: ■Define the term management ■Explain the major challenges with which managers must deal ■Describe how historical research on management has contributed to the current practice of management ■Identify and discuss the primary managerial functions © 2008 Prentice-Hall Business Publishing Learning Objectives Explain the three general roles involved in managerial work and the specific roles within each ■Explore and describe the three dimensions of managerial jobs ■Discuss the primary skills required to be an effective manager ■ © 2008 Prentice-Hall Business Publishing What is Management? Management is a process that involves: ■Assembling and using sets of resources ■Acting in a goal-directed manner to accomplish tasks ■Activities carried out in an organizational setting © 2008 Prentice-Hall Business Publishing Managerial Challenges Managing Change Managing Entrepreneu rially Managerial Challenges Managing Resources Managing Strategically © 2008 Prentice-Hall Business Publishing Managerial Challenges: Managing Change Managing change: ■Is the most persistent, pervasive and powerful challenge for managers ■Requires managers to gain employee acceptance Two causes of change: ■Technology ■Globalization © 2008 Prentice-Hall Business Publishing Managerial Challenges: Managing Resources Managers...
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...Role of the Manager Report Introduction In this report I will examine the extent in which the concepts of the Managerial Escalator fit with the experiences of two managers that were interviewed by me. The first part of this report will try and clarify the concept of the Managerial Escalator with focus on Rees and Porters different concepts as well as unfolding their own standpoint on it. The second part of the report will show a clear analysis of two managers who have managerial responsibilities in their roles and in their line of work or have had then ascertain any extents in which the two managers progression into management fits in with the managerial escalator. The Managerial Escalator The Managerial Escalator can be described as a concept that can be used to explain how different specialists can become managers. Specialists can be hired to carry out specialist activities, in most cases it is considered that a specialist will gradually gain experience in supervising. Following an assured amount of time it is considered that the specialist could be promoted, this could be between 1 to 5 years and in many different organisations or companies a specialist being promoted could mean that they have the chance to take on managerial responsibilities. Specialists can also work as team leaders and by doing this they can gain some type of managerial responsibly even if they working in a junior role within their particular organisation. After staying in that job for a number of...
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...Introduction In this report I will examine the extent in which the concepts of the Managerial Escalator fit with the experiences of two managers that were interviewed by me. The first part of this report will try and clarify the concept of the Managerial Escalator with focus on Rees and Porters different concepts as well as unfolding their own standpoint on it. The second part of the report will show a clear analysis of two managers who have managerial responsibilities in their roles and in their line of work or have had then ascertain any extents in which the two managers progression into management fits in with the managerial escalator. The Managerial Escalator The Managerial Escalator can be described as a concept that can be used to explain how different specialists can become managers. Specialists can be hired to carry out specialist activities, in most cases it is considered that a specialist will gradually gain experience in supervising. Following an assured amount of time it is considered that the specialist could be promoted, this could be between 1 to 5 years and in many different organisations or companies a specialist being promoted could mean that they have the chance to take on managerial responsibilities. Specialists can also work as team leaders and by doing this they can gain some type of managerial responsibly even if they working in a junior role within their particular organisation. After staying in that job for a number of years they could be formally...
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...Management Control of Project Portfolio Uncertainty: A Managerial Role Perspective Tuomas Korhonen, Cost Management Center (CMC), Department of Industrial Management, Tampere University of Technology, Tampere, Finland Teemu Laine, Cost Management Center (CMC), Department of Industrial Management, Tampere University of Technology, Tampere, Finland Miia Martinsuo, Department of Industrial Management, Tampere University of Technology, Tampere, Finland PAPERS ABSTRACT ■ This article presents empirical results on different managers’ viewpoints regarding the sources and management of project portfolio uncertainty. As a key result, this study demonstrates the versatility of uncertainties experienced by managers, the limited degree of perceived control over them, the use of an almost complete management control package in managing uncertainties, and the necessity of managers’ cooperation in the skilled use of the management control package when managing uncertainties. In addition, a further research agenda is proposed. KEYWORDS: project portfolio management; uncertainty; managerial roles; management control systems; product development INTRODUCTION ■ n their product development, large companies have adopted project portfolio management (PPM) as a means for prioritizing and selecting product development projects among various options as well as allocating resources with the value maximization, balance, and strategic alignment of the portfolio in mind (Cooper, Edgett, & Kleinschmidt...
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...1.0 ABSTRACT Managerial Accounting is tools for business decision making. The use of management accounting information is a key for organizational success. This essay will explain on the importance of managerial accounting process in organization to successfully carrying out the day to day as well as long term activities and goals. First, it describes how the evolution and change in managerial accounting. Second, the essay looks at the role of managerial accountants. Third, it explains several function of managerial accounting that tend to contribute the adds value to organization. 2.0 INTRODUCTION According to the Chartered Institute of Management Accountants ( CIMA ), Management Accounting is defined as the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of information for both financial and operating used by management to plan, evaluate and control within an organization and to assure use of and accountability for its resources. The Institute of Management Accountants ( IMA ) defined Management Accounting is a profession that involves partnering in management decision making, devising planning and performance management system and providing expertise in financial reporting and control to assist management in the formulation and implementation of an organization’s strategy. Managerial accounting applies to all types of business such as service, merchandise and manufacturing. It also applies to all forms...
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...The role of a manager within the functional areas of business Amir Yousef MGT/521 December 8, 2014 The University of Phoenix Abstract “When a business has implemented a successful planning process, every employee can see a clear link between the overarching company direction and the work they perform.” (Capezio, P. J.) The role of a manager within the functional areas of business Introduction “When a business has implemented a successful planning process, every employee can see a clear link between the overarching company direction and the work they perform.” (Capezio, P. J.) According to Robbins and Coulter study (2012), the management concept can be defined as an individual who coordinates and oversees the work of other people so that organizational goals can be accomplished in an efficiently and effectively manner. This efficient and effective aspect of the managerial process requires that managers are doing the right thing in the right way (Robbins and Coulter, 2012). So the role of manger is to help others doing their work. However, the managerial part of the management process is addressing Mintzberg’s theory, which explains what managers do at work through specific actions. A manger should be capable of performing all facets of the managerial functions of planning, organizing, leading and controlling in any organization (Robbins and Coulter, 2012). A Functional Manager is in charge of a specific business unit. direct, technical supervisor Here...
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...Functional Areas of Business MGT 521 June 15th, 2014 Abstract The functional areas of business are management, law, human resources management, leadership, accounting, finance, economics, research and statistics, operations management, marketing, and strategic planning. I believe all the functional areas are necessary to have a successful organization, however, the two areas stand out as vital to getting a business started and keeping it profitable, and they are human resources and the accounting departments. An organization will need to analyze what roles are vital when hiring their personnel to make sure they are suitable for their positions. Functional Areas of Business The functional areas of business are management, law, human resources management, leadership, accounting, finance, economics, research and statistics, operations management, marketing, and strategic planning. I believe all the functional areas are necessary to have a successful organization, however, the two areas stand out as vital to getting a business started and keeping it profitable, and they are human resources and the accounting departments. Human Resources (HR) is the department that is responsible personnel hiring, applicant tracking, development employee skills, benefits and making sure people are in compliance with regulations. According to McShulskis (1996) article, the function of Human Resource departments is growing in strategic importance and also stated that more than three quarters...
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...Roles and Functions Paper The roles and applications of the management functions are what keep a business flowing. The world we live in is filled with both dramatic uncertainty and opportunity. A manager must responsibilities require them to work in and create an environment that will promote empowerment, teamwork, self-management, promotes participation, and involvement, higher performance, greater efficiency, lower cost and more. Therefore, this reading will define 10 roles of managerial duties and provide the definitions of management functions within the management process. Along with discussing the most important function in management function as well as discuss what I want to gain by taking this class. Managerial Roles The simplest ways to define the positions and importance of managers within a workplace, is to use Henry Mintzberg's systematically divided description of managerial work. Mintzberg's describes the nature of managerial work in 10 roles. Mintzberg, according to Lombardi and Schermerhorn (2007), believes that managers fall into three categories the first being interpersonal where managers roles involve interaction with people during and after work. The second is informational roles and involves the receiving, analyzing, and receiving of information. The third is decisional roles and involves using information to make decisions, address opportunities and solve problems. The ten managerial roles fall under the three categories listed above as follows: •...
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...Chapter 01 The Changing Role of Managerial Accounting in a Dynamic Business Environment True / False Questions 1. Controlling involves the coordination of daily business functions within an organization. True False 2. Measuring the performance of managers and subunits is not an objective of managerial accounting. True False 3. Middle-level managers would likely be considered internal users of accounting information rather than external users. True False 4. A controller is normally involved with preparing financial statements. True False 5. The upper limit on the production of goods and services if everything works perfectly is known as practical capacity. True False Multiple Choice Questions 6. Which of the following statements about managerial accountants is false? A. Managerial accountants more and more are considered "business partners." B. Managerial accountants often are part of cross-functional teams. C. An increasing number of organizations are segregating managerial accountants in separate managerial-accounting departments. D. In a number of companies, managerial accountants make significant business decisions and resolve operating problems. E. The role of managerial accountants has changed considerably over the past decade. 7. The day-to-day work of management teams will typically comprise all of the following activities except: A. decision making. B. planning...
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...Chapter 01 The Changing Role of Managerial Accounting in a Dynamic Business Environment Chapter 01 The Changing Role of Managerial Accounting in a Dynamic Business Environment Answer Key True / False Questions 1. Controlling involves the coordination of daily business functions within an organization. FALSE AACSB: Reflective Thinking AICPA BB: Industry AICPA FN: Decision Making Bloom's: RC Difficulty: Easy Learning Objective: 01-02 Explain four fundamental management processes that help organizations attain their goals. 2. Measuring the performance of managers and subunits is not an objective of managerial accounting. FALSE AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Research Bloom's: RC Difficulty: Easy Learning Objective: 01-03 List and describe five objectives of managerial accounting activity. 3. Middle-level managers would likely be considered internal users of accounting information rather than external users. TRUE AACSB: Reflective Thinking AICPA BB: Resource Management AICPA FN: Reporting Bloom's: RC Difficulty: Easy Learning Objective: 01-04 Explain the major differences between managerial and financial accounting. 4. A controller is normally involved with preparing financial statements. TRUE AACSB: Analytic AICPA BB: Resource Management AICPA FN: Reporting Bloom's: RC Difficulty: Medium Learning Objective: 01-06 Describe the roles of an organization's chief financial...
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...nature of business characteristics implies that also techniques used in managerial accounting for each business differ as the business grows. During start up the business rely on capital investment and budgeting techniques. A mature business relies upon quality control and cost management. Techniques used ultimately assist the business to achieve its long-term and short-term aims via efficient decision-making. The objective of this paper is to study each concept available in the accounting definition and provide a framework needed for deep understanding of aspects and issues involved in the process of accounting. The paper will have two part. The first part will look at the first aspect that is to define managerial accounting and look at its role, techniques and ethical issues facing managerial accountant. We will also highlight the role of a managerial accountant. In the second part, three topics will be covered. The three topics are; cost investment techniques, budgeting, and quality control. In the selected topics, real-world cases will be presented in relation to how they relate to managerial accounting techniques. Managerial accounting is defined as process involving preparation of management accounts and reports so as to provide timely and accurate statistical data needed by managers in their routine decisions. It might also involve identification of information, analyzing, measuring, communicating and interpreting it in line with an organization’s goals. Managerial accounting...
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...1 1. | Controlling involves the coordination of daily business functions within an organization. True False | 2. | Measuring the performance of managers and subunits is not an objective of managerial accounting. True False | 3. | Middle-level managers would likely be considered internal users of accounting information rather than external users. True False | 4. | A controller is normally involved with preparing financial statements. True False | 5. | The upper limit on the production of goods and services if everything works perfectly is known as practical capacity. True False | 6. | Which of the following statements about managerial accountants is false? A. | Managerial accountants more and more are considered "business partners." | B. | Managerial accountants often are part of cross-functional teams. | C. | An increasing number of organizations are segregating managerial accountants in separate managerial-accounting departments. | D. | In a number of companies, managerial accountants make significant business decisions and resolve operating problems. | E. | The role of managerial accountants has changed considerably over the past decade. | | 7. | The day-to-day work of management teams will typically comprise all of the following activities except: A. | decision making. | B. | planning. | C. | cost minimizing. | D. | directing operational activities. | E. | controlling...
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