Chapter 1

Question 1

What are the 3 main functions of a manager in managerial accounting

Answer 1

Planning, controlling, motivating
- all these are used to aid in decision making…

Question 2

Who are some of the internal users of financial information from in managerial accounting

Answer 2

Managers, for budgeting, forecasting and planning

Question 3

Who are some of the external users of financial information from in financial accounting

Answer 3

Investors, creditors, and the CRA

Question 4

Is managerial accounting forward-looking or historical?

Answer 4

Forward looking

Question 5

Does managerial need to follow GAAP? If not who does it follow…

Answer 5

No, it doesn’t need to follow GAAP or any prescribed format

Question 6

Is precision important in managerial accounting

Answer 6

No… we can not be 100% precise when forecasting, so timeliness of information is more important

Question 7

Note some of the characteristics of controlling in managerial accounting…

Answer 7

• keeping activities on track; making sure goals/targets are met
• deciding on changes to get back on track
• may use formal / informal systems of evaluation; performance reports, budget comparisons

Question 8

Note some of the characteristics of planning in managerial accounting…

Answer 8

Establishing objectives for the company:
- maximize short term profit
- commit to sustainable practices
- long term shareholder wealth

• perhaps the company has to look at cost cutting since the market is completely saturated…

Question 9

Note some of the characteristics of directing & motivating in managerial accounting…

Answer 9

Managing day to day activities to keep everything running smoothly…
- delegating tasks to staff
- hiring employees
- effective communications
- conflict resolution
- incentivizing employees

Question 10

what is decision making…

Answer 10

• Choosing amongst competing alternatives
• Good decision-making is the outcome of good judgment in planning, directing, motivating and controlling

Question 11

Business plan - what is it

Answer 11

The business plan is a key document for: the organization’s internal management, and external use in attracting creditors and investors

• outlines how a company will reach its target market, strategy, etc. (Think Dragons Den)

Question 12

What is delegation in organizational structure?

Answer 12

Delegation is the decentralization of decision making authority within an organization

Question 13

What does a Controller do?

Answer 13

Top executive responsible for:
- providing timely data to support planning & controlling
- preparing finacnial statements for external users

Question 14

What are the 4 key pillars of ethical behaviour

Answer 14

Competence
Confidentiality
Integrity
Credibility
(CCIC)

Question 15

why is competence important in accounting…

Answer 15

Competence/professionalism is very important in the accounting profession because they are responsible for providing accurate information, to be used in financial decisions

Question 16

why is confidentiality important in accounting / business…

Answer 16

Confidentiality surrounds keeping private information confidential; not saying client names for PwC, BCI, etc.

Question 17

Sum up integrity in one sentence…

Answer 17

Integrity involves refraining from doing anything unprofessional which may tarnish the reputation of UofA, PwC, BCI, etc.

Question 18

what are some characteristics of credibility in ethics…

Answer 18

• disclosing all relevant info that may influence a users decision
• communicating info fairly and objectively
• disclosing delays / deficiencies

Question 19

Why do we need Ethical Standards?

Answer 19

Without them, the econony and everyone who depends on it would suffer

And we would have a lower quailty of life with worse goods at higher prices

Question 20

Corporate Governance, describe what it is and some of the performance metrics used…

Answer 20

It is a system by which a company is controlled and directed

Employee & customer satisfaction and service, hitting financial targets