CHAPTER 1: OBJECTIVES , ROLE AND SCOPE OF MANAGEMENT ACCOUNTING Flashcards
(25 cards)
Basic Management Functions
- Planning
- Directing and Motivating
- Controlling
Planning
it establish a strategy or selecting a course of action and how the action will be implemented
Directing and Motivating
- take action to implement the plan
- motivate others to achieve result
Controlling
ensuring that the plan is actually carried out and is modified as circumstances changes
Difference of FA vs MA in User Perspective?
FA - for external users
MA - for internal users
Difference of FA vs MA in Types of Reports/ Information
FA - FS primarily monetary (financial) in nature
MA - Monetary and Non-Monetary report
Difference of FA vs MA in Guiding Principle
FA - Generally Accepted Accounting Principles (GAAP)
MA - None
Difference of FA vs MA in its Purpose
FA - financial reporting and compliance
MA - decision-making, planning and control
Difference of FA vs MA in Time Orientation
FA - historical (past) data
MA - future oriented using current and past data
Difference of FA vs MA about the Level of Detail
FA - focus mainly on business as a whole
MA - extensive and detail
Difference of FA vs MA as Necessity
FA - mandatory
MA - optional
Difference of FA vs MA in Source of Data
FA - from internal information system
MA - from internal and external sources
Controllership
process to assure the the resources are obtained and utilized according to the plans
Controller
- officer who is responsible for the accounting aspect of the management control
- supervising the personnel
- preparing the information and reports in both FA and MA
Treasurer
- responsible for raising the capital
- safeguarding the assets
- managing its investment
Internal Auditor
reviewing the accounting procedures records and reports in both controller’s and treasurer’s responsibility, in where he express an opinion regarding the assertions
Competence
Maintain an appropriate level of professional expertise
Professional Ethics (ICCC)
refers to the standard of conduct for judging the right from wrong, honest to dishonest and fair from unfair
- Integrity
2 Competence - Confidentiality
- Credibility
Integrity
mitigate actual conflict of interest
Confidentiality
keep the information confidential
Credibility/ Objectivity
- communicate the information fairly
- disclose all relevant information
Line Function
direct relationship towards the operation of the business
Staff position
support the line position from operating the business
Management by Objectives
a procedure in which a subordinate and a supervisor agree on
- goals
- methods of achieving them and develop a plan in accordance with that agreement
