Chapter 1 Flashcards
What are the 6 differences b/w financial accounting and managerial accounting? Financial Accounting…
- fs. for external users, quarterly,annual reports, general purpose, pertainsto business as a whole, highly aggregated, limited to double entry and cost, GAAP
What are the 6 differences b/w financial accounting and managerial accounting? Managerial Accounting…
- internal reprots, often as needed, specificpurpose, pertains to subuntis of the business, very detailed, any relevant data, stand is relvant to decsiions
What are management’s functions?
- Planning, 2. Directing, 3. Controlling
Explain Planning
look ahead to establish objectives
Explain DIrecting
Coordinating a copmany’s diverse activities and human resources, implementing planned objectives and providign necessary incentives to motivate employees
Explain Controlling
the process of keeping the company’s activities on track
determine whether planned goals are being met, what changes are needed to get back on track
How do managers achieve control in a small company
observe, ask questions, and know how to evaluate the answers
How do managers achieve control in a large copany
use formal systems (budgets, responsiblitiy centres, performance evaluation reports)
What are shareolders
owners, manager the company indirectly thourght the BOD which they elect
What is the Board of Directors
create operating policies, select officers such as president and vice president
what is the CEO
over all responsiblitiy for managing the business, delegates responsiblities to the other officers
What are line postions
-directly involved with company’s main revenue generating activities, vice pres of opearations, president of marketing, plant managers and supervisors, production personel
What are staff positions
support lien employees, finance, legal, human resources
What is the CFO
Responsible for all accoutning and finance, supported by the controller and the reasurer
what is the controller
- maintains accoutning reocrds, 2. maintains adequate system of internal controls, 3. perparing f.s., tax returns and itnernal reports
What does the Treasurer do
has custody of the corporations’ funds an dis responsible for maintining the ocmpany’s cash position
what does the internal audit staff do
- also serve the CFO, reviwing teh reliabiltiy and integrityof finacial informaiton provided by the controller and treasurer, make sure internal control systems are funciton properly to safeguard corproate assets
what is the VP of operations
oversees employees with line positions ex company might have multiple plant managers and each one would reprot to vp of operations
What are the IMA’s statement of ethical professional practice?
- competence, confidentiality, integrity, creditability
what does it mean by competence
- maintain professioanl competence, 2. perform professional duties in accordanc with relevant laws, regulationsa dn technical standards, 3. prepare complete and clear reports and recommendations, 4. communicate professional limitations that would preclude responsible judgement or successful performance of an activity
What does it mean by confidentiality?
- refrain from disclosing confidential info, inform suboridantes as how to handle confidental informaiton, refrain from using ocnfiential info for unethical or illegal advantage
What does it mean by integrity?
avoid conflicts of interest, refrain from activity that would prejudice tehir ability to carry out their duties ethically, refrain from engaging in or supporting any activity that would discredit the accouting profession
what does it mean by creditability- objectivity?
communciate informaiton fairly and objectiviely, disclsoe fully all relevant informaiton that oculd reasonably be expected to influence a suer’s understanding of the reports, comments and recommendations presented
What is the value chain
all activities assocaited with provdiign a product or service
