Strategic Management Accounting
Introduction
Firms are now should face a lot of competition because a lot of changes in contemporary business, such as globalization of world trade, changing product life cycle, changing customers tastes that demand to improve levels of service in cost, quality, reliability, delivery and the choice of new products; and the emergence of e-business and so on. As a result of the defects of traditional accounting have been unable to meet these changes new management themes have evolved which in turn has resulted in the development of strategic management accounting.
Strategic management accounting aims to provide relevant information to an organization’s management to enable them to make strategic plans and strategic decisions. The emphasis is on external information on competitors, customers, markets, and environment and so on. Organizations cannot rely on financial information alone – non-financial information also plays an important part of the organizations’ decision making. It can be argued that strategic management accounting has a positive role of supporting the financial needs of management in their task of directing and controlling the business in the best interest of its owners and other stake holders.
Types of management accountants
Management accountants are responsible for the accounting system within organizations. An accounting system should be designed to assist financial and tax reporting for planning and decision-making. In small organizations, to manage the accounting function is usually by a bookkeeper who records the transaction. An external accountant often assists the preparation of financial statements and tax returns. Focus on financial reporting tools, managers may not have relevant information more easily for planning purposes. Control decisions cannot be regarded as important because the manager to make these decisions is likely to be owner.
In large organizations, like Jessup, controller is typically assigned responsibility for
Firms are now should face a lot of competition because a lot of changes in contemporary business, such as globalization of world trade, changing product life cycle, changing customers tastes that demand to improve levels of service in cost, quality, reliability, delivery and the choice of new products; and the emergence of e-business and so on. As a result of the defects of traditional accounting have been unable to meet these changes new management themes have evolved which in turn has resulted in the development of strategic management accounting.
Strategic management accounting aims to provide relevant information to an organization’s management to enable them to make strategic plans and strategic decisions. The emphasis is on external information on competitors, customers, markets, and environment and so on. Organizations cannot rely on financial information alone – non-financial information also plays an important part of the organizations’ decision making. It can be argued that strategic management accounting has a positive role of supporting the financial needs of management in their task of directing and controlling the business in the best interest of its owners and other stake holders.
Types of management accountants
Management accountants are responsible for the accounting system within organizations. An accounting system should be designed to assist financial and tax reporting for planning and decision-making. In small organizations, to manage the accounting function is usually by a bookkeeper who records the transaction. An external accountant often assists the preparation of financial statements and tax returns. Focus on financial reporting tools, managers may not have relevant information more easily for planning purposes. Control decisions cannot be regarded as important because the manager to make these decisions is likely to be owner.
In large organizations, like Jessup, controller is typically assigned responsibility for
References: Colin drury, management ＆ cost accounting；5th edition,2000. Evolution and Revolution, Chartered Institute of Management Accountants. Garrison, Ray H., Noreen, Eric W., Brewer, Peter C., Managerial Accounting 12th Edition, 2007, p.578, New York. Innes. K (1998) Strategic management accounting, in Innes J. Handbook of Management Accounting, Gee. London Management Accounting Guideline 46, the Society of Management Accountants of Canada, 1988. S.Harrison,” Not Just Bean Counters Anymore,” Management Accounting, March 1993, p.29-32. Strategic management accounting, University of Sunderland, 2008. Williams, Jan R., Haka, Susan F., Bettner, Mark S., Meigs, Robert F. Financial and Managerial Accounting: The Basis for Business Decisions, 2002, p.848.