Accounting is increasingly developing and giving birth to different types of accounting, namely Financial Accounting and Management Accounting. So what is management accounting? Basic content of corporate management accounting. Let’s find out together.
1. What is management accounting?
What is management accounting?
– According to Ronald W. Hilton, professor at Cornell University (USA): “Management accounting is a part of the management information system in an organization that managers rely on to plan and control activities. organization’s actions”
– According to Ray H. Garrison: “Management accounting is related to providing documents to managers who are inside economic organizations and are responsible for operating and controlling all activities of the company. organization”
– According to University of South Florida professors Jack L. Smith, Robert M. Keith and William L. Stephens: “Management accounting is an accounting system that provides managers with quantitative information that they needed for planning and control.”
– From the above concepts, the most common points about management accounting are:
+ is an accounting system that provides quantitative information
+ Information users are objects in the organization/unit
The purpose of using information is to plan and control the activities of the organization/unit
The concept of management accounting:
– Management accounting is a science of obtaining, processing and providing quantitative information about the activities of an entity in detail, helping managers in the process of making related decisions. to planning, organizing, implementing, checking, controlling and evaluating the performance of the unit’s activities.
Viewing: What is management accounting
Thus, management accounting was born when a market economy appeared. Management accounting is a type of accounting for managers, it is considered as a decision support system for managers, a means to exercise management control in an enterprise.
2. Basic content of corporate management accounting
Basic content of management accounting
* Management accounting has very broad content, here are some basic contents:
Considering the content of information provided by management accountants, management accounting can be summarized as follows:
+ Management accounting of factors of production and business (procurement, use of labor objects – inventory, labor materials – fixed assets, recruitment and use of labor – labor and money) wage,…)
+ Management accounting on costs and product costs (product identification, cost classification, product costs, cost estimation, collection, calculation, cost allocation, costing, making cost analysis reports by department, by decision situations..)
+ Management accounting of revenue and business results (classification of revenue, determination of selling prices, making revenue estimates, calculation and detailed accounting of revenue, allocation of general costs, determination of results) detailed analysis, detailed results analysis reports by department, decision-making situations ..)
+ Debt management accounting
+ Management accounting of financial investment activities
+ Management accounting for other activities of the business
=> The main content of management accounting is the field of cost. Therefore, some authors argue that management accounting is cost accounting.
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Considering the management accounting process in relation to the management function, management accounting includes:
+ formalize the organization’s goals into economic indicators
+ make general estimates and detailed estimates
+ collect and provide information on the results of the implementation of the goals
+ Prepare management accounting reports
– Information of management accounting is not only past information (implementation information) but also includes information about the future (plans, estimates, estimates, ..) On the other hand, accounting information Management accounting is not only information about value but also includes other information (in kind, labor time …)
Above is the article about “What is management accounting? Basic content of management accounting” by Duc Minh Accountant. For more useful information about management accounting, please refer to Duc Minh Accounting website.
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