This ppt covers the following points :-
1. introduction of management accounting
2. Definition of management accounting
3. Nature, objective, tools and techniques, significance and limitations of management accounting
4. difference between financial and management accounting and also includes difference between cost and management accounting
5. management accountant and its roles
6. Management accounting organisation
4. Definition of Management Accounting
Management accounting refers
to the presentation of
accounting information in such
a way as to assist management
to the creation of policy and the
day to day operation of an
undertaking”
5. Nature of Management Accounting
0 Service function - because it assist management by providing necessary
information related to accounting.
0 More concerned with future - it is related to future because decision are taken by
analysing accounting information is for future.
0 Selective in nature - because it provide selective information from mess data to the
management.
0 Only supplies data not a decision - it only provide a data to the management not
take any decision.
0 Integrated system - it is integrated system because it contains both accounting and
management.
6. Objective of Management Accounting
0 Its main objective is to provide selctive information to the
management.
0 To assist in planning.
0 To assist in decision-making.
0 To assist in controlling.
0 To assist in co-ordination.
0 Helpful in reporting.
7. Tools & techniques of Management Accounting
0 Financial planning
0 Financial Statement Analysis
0 Cost Accounting
0 Fund Flow Analysis
0 Cash Flow Analysis
0 Standard Costing
0 Marginal Costing
0 Budegtary Control
0 Revaluation Accounting
0 Decision-making Accounting
0 Management Information System
0 Management Reporting
0 Statistical Technique
0 and so on....
8. Significance of Management Accounting
0 Proper Planning
0 Effective controlling
0 Increased efficiency
0 Maximizing profitability
0 Performance appraisal
0 Increase in productivity
0 and so on....
9. Limitations of Management Accounting
0 Based on Accounting information - if wrong information provided then decision
also became wrong.
0 Lack of knowledge & understanding - if management have no proper knowledge
about information decision may interrupted.
0 Lack of continuity & coordination among different departments of organisation
even management to management, it will effect the decision-making process.
0 It is very expensive to set a management accounting system.
0 It is much time consuming.
0 It is based on historical data.
10. Difference between Financial & Management Accounting
S.
no.
Basis Financial Accounting Management Accounting
1. Objective
It provides periodical reports
to owners, government and
creditors.
It provide reports to
management only.
2. Nature
Concerned with historical
records.
Concerned with future plans &
policies.
3. Subject matter Deals with business as whole. Deals only a limited coverage.
4. Flexibility Less flexible. More flexible.
5. Legal compulsion Statutory Voluntary
6. Scope Narrow Wide
7.
Periodicity of
reporting
At the end of accounting year. Prepared when required.
8.
Publication &
audit
Essential for public use. For management only.
9.
Based on
accounting
principles
Yes, based on accounting
principles.
No specific principles are
adopted.
11. Difference between Cost & Management Accounting
S.
no.
Basis Cost Accounting Management Accounting
1. Objective
Find out the cost of products
or services.
Provide information for
decision-making.
2. Nature Both for past and present. For future.
3. Scope Narrow Wide.
4. Age Old concept Modern concept.
5. Principles
Principles & methods are
adopted.
No specific principles are
adopted.
12. Management Accounting Organisation
Controller
Chief Cost
Accountant
Budget Officer
Chief Accountant/Chief
works Accountant
Chief Auditor
Accounting
System
Corporate
Accounting
Accounting
Services
Assets Accounting
Billing Maintain Records Classifying Summarising Communication
13. Management Accountant -
A management Accountant is
person who assist the
management in decision-making
by providing necessary accounting
information.
14. Roles of Management Accounting
0 It provides necessary accounting information to management.
0 It coordinates with other departments for getting information.
0 It controls the performance.
0 It advices the management.
0 It assist the management in decision-making.
0 It preparing reports.
0 and so on….
