Features and Types of Management Accounting System
LO1.Discuss an understanding of management accounting systems.
Briefs and Guidance
Write a report on the role and function of the management accounts department, covering the management accounting systems operating in the organization as well as the range of techniques used. The report should cover three key elements:
- Examine the management accounting and the essential requirements of different types of management accounting systems. Also, evaluate the benefits of management accounting systems and their application within an organizational context (such as GSQ Limited) in order to strengthen your report.
- explanation of different methods used for management accounting reporting.
LO2. Provide a range of management accounting techniques.
GSQ ltd has approached your company for an advice regarding the use of a suitable management accounting tool which it can use its processes. Your line manager has handed the task over to you, and you are required to prepare a report as well as (PowerPoint) presentation slides using the information from GSQ ltd.
Calculate costs (cost per unit and total cost and produce financial reports (such as income statements) in order to interpret data for a range of GSQ activities.
GSQ Ltd makes and sells a single product. In October 2018:
Output and sales 50,000units.
Selling price per unit £30.00
Direct materials cost per unit £8.00
Direct wages per hour £9.00
Variable manufacturing overhead per unit £2.00
Variable selling expenses per unit £4.00
Fixed manufacturing Overheads £160,000
Fixed admin and distribution costs £60,000
Direct manufacturing labor per unit 20 minutes.
LO3 Examine the use of planning tools used in management accounting.
LO4 Explain ways in which organizations could use management accounting to respond to financial problems.
As a role of assistant accountant, you have been asked by your line manager to provide another report which examine the organization’s use of planning tools to ensure financial stability and performance as well as ways in which management accounting has played a key role in preventing and solving financial problems. Also, cover the following in the report:
- Explanation of the advantages and disadvantages of different types of planning tools used for budgetary control.
- Compare how organizations are adapting management accounting systems to respond to financial problems. In addition, you may also analyses how, in responding to financial problems, management accounting tools can lead organizations to sustainable success. Also, provide the appropriate example of it.
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Learning Outcomes and Assessment Criteria |
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Pass |
Merit |
Distinction |
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LO1.Discuss an understanding of management accounting systems. |
D1 Critically analyse how management accounting systems and management accounting reporting is integrated within organisational processes. |
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P1 Examine management accounting and give the essential requirements of different types of management accounting systems. P2 Identify different methods used for management accounting reporting. |
M1Analyse the benefits of management accounting systems and their application within an organisational context. |
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LO2. Provide a range of management accounting techniques. |
D2 Provide financial reports that accurately apply and interpret data for a range of business activities. |
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P3 Calculate costs using suitable methods of cost analysis to produce an income statements using marginal and absorption costs. |
M2 Use a range of management accounting techniques and produce appropriate financial reporting documents. |
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LO3 Examine the use of planning tools used in management accounting. |
LO3 & 4 D3 Assess how planning tools for accounting respond appropriately to solving financial problems to lead organisations to sustainable success. |
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P4 Identify the advantages and disadvantages of different types of planning tools used for budgetary control. |
M3 Evaluate the use of different planning tools and their application for preparing and forecasting budgets. |
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LO4 Explain ways in which organizations could use management accounting to respond to financial problems. |
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P5 Analyse how organisations are adapting management accounting systems to respond to financial problems. |
M4 Assess how, in responding to financial problems, management accounting can lead organisations to sustainable success. |
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INTRODUCTION
Management accounting can be defined as the process in which the reports of business operations are prepared, these reports helps the business manager in making the short term or long term decisions of company. It have the task of identifying, analysing, measuring, communicating and interpreting the financial information to the users. Report is about GSQ and it will be revealing the importance of management accounting systems, management accounting reports, the different types of management accounting techniques. It will also be providing about the planning tools in budgetary control. The study will also be revealing about the different management accounting methods for responding to financial issues.
