Introduction to Managerial Accounting

Introduction to Managerial Accounting

Project Type: Presentation (ppt)

Downloads: 0 - 10 Monday 20th March 2017 Report

Introduction to Managerial Accounting - Overview

------------ PAGE 1 ------------ Introduction to Managerial Accounting and the Business Environment By ------------ PAGE 2 ------------ Managerial Accounting and Financial Accounting Managerial accounting provides information for managers of an organization who direct and control its operations. Financial accounting provides information to stockholders, creditors and others who are outside the organization. ------------ PAGE 3 ------------ Work of Management Planning Controlling Directing and Motivating ------------ PAGE 4 ------------ Planning and Control Cycle Formulating Long- and Short- Term Plans ( Planning) Measuring Performance ( Controlling) Comparing Actual to Planned Performance ( Controlling) Implementing the Plans ( Directing and Motivating) Begin Decision Making ------------ PAGE 5 ------------ Differences Between Financial and Managerial Accounting FinancialManagerialAccountingAccounting 1. UsersExternal persons whoManagers who plan formake financial decisionsand control an organization2. Time focusHistorical perspectiveFuture emphasis3. VerifiabilityEmphasis onEmphasis on relevance versus relevanceverifiabilityfor planning and control4. Precision versusEmphasis on Emphasis on timelinessprecisiontimeliness5. SubjectPrimary focus is onFocuses on segments the whole organizationof an organization6. RequirementsMust follow GAAPNeed not follow GAAPand prescribed formatsor any prescribed format ------------ PAGE 6 ------------ Corporate Organization Chart Purchasing Personnel Vice President Operations Treasurer Controller Chief Financial Officer President Board of Directors Organizational Structure An organization is a group of people united for a common purpose. ------------ PAGE 7 ------------ Decentralization Decentralization is the delegation of decisionmaking authority throughout an organization. Corporate Organization Chart Purchasing Personnel Vice President Operations Treasurer Controller Chief Financial Officer President Board of Directors ------------ PAGE 8 ------------ Line and Staff Relationships Line position are directly related to achievement of the basic objectives of an organization. ľ Example: Production supervisors in a manufacturing plant. Staff positions support and assist line positions. ľ Example: Cost accountants in the manufacturing plant. ------------ PAGE 9 ------------ The Controller The chief accountant in an organization with responsibility for: ľ Financial planning and analysis. ľ Cost control. ľ Financial reporting. ľ Accounting information systems. ------------ PAGE 10 ------------ The Changing Business Environment A more competitive environment emphasizing: Č Higher quality products ľ Lower prices and costs č Global competition ď Meeting and anticipating customer needs Business environment changes in the past twenty years ------------ PAGE 11 ------------ The Changing Business Environment Just- In- Time Total Quality Management Process Reengineering Theory of Constraints New tools for managers! ------------ PAGE 12 ------------ Just- in- Time ( JIT) Systems Receive customer orders. Schedule production. Receive materials just in time for production. Complete parts just in time for assembly into products. Complete products just in time to ship customers. ------------ PAGE 13 ------------ More rapid response to customer orders Less warehouse space needed Reduced inventory costs Greater customer satisfaction Higher quality products Benefits of a JIT System ------------ PAGE 14 ------------ Do we need to change the plan? Where are we? Where do we want to go? How do we start? How are we doing? Check Plan Act is Do Total Quality Management Benchmarking Continuous Improvement ------------ PAGE 15 ------------ Process Reengineering Č A business process is diagrammed in detail. č The process is redesigned to include only those steps that make our product more valuable. ľ Every step in the business process must be justified. ------------ PAGE 16 ------------ Process Reengineering Č A business process is diagrammed in detail. č The process is redesigned to include only those steps that make our product more valuable. ľ Every step in the business process must be justified. ------------ PAGE 17 ------------ Process Reengineering Anticipated results: Č Process is simplified. ľ Process is completed in less time. č Costs are reduced. ď Opportunities for errors are reduced. č The process is redesigned to include only those steps that make our product more valuable. ľ Every step in the business process must be justified. Č A business process is diagrammed in detail. ------------ PAGE 18 ------------ Theory of Constraints A sequential process of identifying and removing constraints in a system. Restrictions or barriers that impede progress toward an objective ------------ PAGE 19 ------------ International Competition Meeting world- class competition demands a world- class management accounting system. ------------ PAGE 20 ------------ Thank You!
Back to top of page