The Function Of Management Accountant Accounting Essay

Management accounting is the procedure of identifying, mensurating, analysing and pass oning fiscal information needed by internal users the such as directors, employees and executive of the company to program, measure and command an organisation ‘s operations. The function of a cost and direction comptroller is to guarantee that information meet the demands of apportioning cost between cost of goods sold and stock lists for users within or outside of the concern, to present relevant information to help directors to do determinations so that they are able to be after, control, step the public presentation and uninterrupted betterment to the concern ( Drury 2008 ) .

In the direction accounting field, the allocating of cost between cost of goods sold and stock lists are of import. Unlike fiscal accounting that calculates merely the net income of the concern without sing the goods that are unsold or partially completed stocks, the direction comptrollers takes elaborate parts of the concern into consideration such as the existent cost of the merchandise, the operating expense cost, production cost, fixed cost, variable cost, etc ( Drury 2008 ) . As the studies are for internal users such as the directors to do determinations for the company, the studies are based on the past and future events. For illustration, a large organisation that manufacturers a big sum of goods, it is necessary to measure the stocks. Every item of production such as the completed merchandises, work in advancement, fresh natural stuffs helps internal users to measure the stocks to cipher the concern ‘s net income ( Drury 2008 ) . Thus a managerial comptroller would hold to fix studies such as budgetary planning, cost findings, cost and net income analysis and public presentation studies ( Managerial Accounting n.d. ) .

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Furthermore, the cost and direction comptrollers have to present relevant information to help directors to do determinations that they are able to strategize the operations in the concern and to do fiscal determinations ( Burch n.d. ) . Information is divided into both everyday and non-routine coverage. Everyday information is information taken from sections of the concern that provides net income into the concern such as merchandises, services, clients and distribution channels. Non-routine information nevertheless is where information is based on strategic determinations such as investings for the company, debut of new merchandise and services, contracts for the concern etc ( Drury 2008 ) . In add-on, the quality of the information provided to directors must be practiced by every comptroller as it is to help directors in understanding the flow of the concern to enable them to do the right determinations for the organisation. A direction comptroller must guarantee that the quality of the information includes properties such as truth, relevance, seasonableness, equity and serviceability. The truth of the information is to do certain that it is free from mistakes and errors ( Burch n.d. ) . Accurate cost information prepared helps to separate between profitable and non profitable activities in the organisation ( Drury 2008 ) . Besides that, Relevancy of the information is besides needed as it must be applicable to the intent intended. Not merely that, the seasonableness of it is to acquire information on clip for the directors and employees. Fairness of the information nevertheless will do certain that information is free from biasness within the concern. Last, the serviceability of information is to guarantee that information should be easy be understood by troughs when presented to them ( Burch n.d. ) . If these properties are non met, it may take to directors doing the incorrect determinations and may convey a ruin to an organisation ‘s profitableness ( Drury 2008 ) .

Planning, commanding, measurings of public presentation and uninterrupted public presentation are besides the few of the maps of a direction comptroller. In the planning procedure, it involves seeking to accomplish concern ‘s ends by organizing an action that should be taken and how it should be done in order to make their aim which is to maximise net incomes ( Managerial Accounting n.d. ) . The programs of direction will therefore be presented in budget signifier which will be done yearly. After the planning phase, comptrollers will travel on to the commanding phase where it is to guarantee that the planned results are tallied with the existent results. This will be done by utilizing the budgeted study comparing it to the existent study ( Drury 2008 ) . To compare both planned and existent results, is where the measuring of public presentation phase comes in, where companies will mention to the feedbacks given. One of the feedbacks that are used to compare would be the public presentation study. The public presentation study will give an penetration of how to concern is executing and whether they require extra attending to better their concern ( Managerial Accounting n.d. ) . An economic feedback to directors should besides be presented in order to assist them in commanding costs and besides to better the concern ‘ operations ( Drury 2008 ) .

In decision, the map of direction comptrollers really plays an of import function in helping an organisation to accomplish their ends and to better their concern ‘ public presentation. If nevertheless the direction comptrollers fail in its function, it may take to a concern ‘s ruin in footings of profitableness.


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