The process of preparation of management accounts and reports is referred to as management accounting. This report gives timely and correct information regarding the financial and statistical affairs of a business. The managers need this information in order to take routine short-term decisions for the organization.
As opposing to financial accounting where reports are prepared annually, the reports of management accounting are prepared on weekly or monthly basis. On one hand financial accounting is useful for outside parties, management accounting proves to be helpful for internal parties including directors, managers of each divisions, and CEO. The management accounting reports, characteristically show revenue generated through sales, the amount of accounts payables, outstanding debts, variance analysis, amount of cash available, trend charts and other statistical values.
The scope of management accounting and finance has changed cost collection and analysis to strategic planning and formulation. The profession of managerial accounting nowadays, involves planning, performance evaluation at the managerial level, providing valuable advice relating to financial reporting, decision making and helping the organization in formulation of planned strategies.
Management accountants are employed to perform the tasks of managerial accounting. Management accountants give information to management regarding the sensitivity of market to the quality and price of the products being manufactured by the organization, the growth of the respective industry and the prospective customers. They make use of financial ledger system in order to provide information on management accounting.
With the competition rising in the corporate environment globally, it is expected from the organization to compete on matters of timely services and quality of the good and services. This forces management accountants Northampton to focus beyond the financial reports in order to assess the…