Chapter 1 book Flashcards
consisting of small, detailed bits of information that can be used for multiple purposes
database
also known as a data warehouse or infobarn
a single database that collects data and feeds them into applications that support a companys business activities, such as purchasing, distribution, and sales
ERP system
Enterprise Resource Planning
focuses on reporting financial information to external parties such as investors, government agencies, banks, and suppliers based on Generally Accepted Accounting Principles (GAAP)
Financial accounting
the process of measuring, analyzing and reporting financial and nonfinancial information that helps managers make decisions to fulfill the goals of an organization.
management accounting
Managers use this type of accounting information to:
1. develop, communicate, and implement strategies
2. coordinate, design, operations, and marketing decisions and evaluate a companys performance
management accounting
- this type of accounting information and reports do not have to follow set principles or rules
management accounting information
2 key questions for this type of accounting information
1. how will this information help managers do their jobs better
2. do the benefits of producing this information exceed the costs?
management accounting
Purpose of information: help managers make decisions to fulfill an organizations goals
management or financial accounting?
management
Primary Users: managers of the organization
management or financial accounting?
management
Focus and emphasis: future-oriented (budget for 2020 prepared in 2019)
management or financial accounting?
management
Rules of measurement and reporting: internal measures and reports do not have to follow GAAP but are based on cost-benefit analyses
management or financial accounting?
management
Time span and type of reports: varies from hourly information to 15-20 years, with financial and nonfinancial reports on products, departments, territories and strategies
management or financial accounting?
management
Behavioral implications: designed to influence the behavior of managers and other employees
management or financial accounting?
management
Purposes of information: communicate an organizations financial position to investors, banks, regulators, and other outside parties
management or financial accounting?
Financial
Primary users: external users such as investors, banks, regulators, and suppliers
management or financial accounting?
Financial
Focus and emphasis: past-oriented (reports on 2019 performance prepared in 2020)
management or financial accounting?
Financial
Rules of measurement and reporting: financial statements must be prepared in accordance with GAAP and be certified by external, independent auditors
management or financial accounting?
Financial
Time span and type of reports: annual and quarterly financial reports, primarily on the company as a whole
management or financial accounting?
Financial
Behavioral implications: primarily reports economic events but also influences behavior because managers compensation is often based on reported financial results
management or financial accounting?
Financial
the process of measuring, analyzing, and reporting financial and nonfinancial information related to the costs of acquiring or using resources in an organization
cost accounting
the activites managers undertake to use resources in a way that increases a products value to cusstomers and achieves an organizations goals
cost management
not only about reducing costs, also incljdes making decisions to incur additional costs
cost management
3 strategies
- cost leadership
- differential strategy
- focus strategy (low cost)
the low cost leader in any market gains competitive advantage from being able to produce at the lowest cost
which strategy?
cost leadership strategy
allows companies to desensitize prices and focus on value that generatees a comparitively higher price and a better margin
which strategy?
differentiation strategy
describes cost management that specifically focuses on strategic issues
strategic cost management
Who are the most important customers, and what critical capability do we have to be competitive and deliver value to our customers?
What is the bargaining power of our customers?
What is the bargaining power of our suppliers?
What substitute products exist in the marketplace, and how do they differ from out product in terms of features, price, cost, and quality?
Will adequate cash be available to fund the strategy, or will additional funds need to be raised?
What are these questions?
Questions Management accounting information helps managers formulate strategy for
the sequence of business functions by which a product (including a service) is made progressively more useful to customers
value chain
a strategy that integrates people and technology in all business functions to deepen relationships with customers, partners, and distributors.
CRM
(customer relationship management)
this things initiatives use technology to coordinate all customer facing activites (such as marketing, sales calls, distribution, and after slaes support ) and the design and production activites necessary to get products and services to customers
CRM
(customer relationship management)
an integrative philosophy of management for continuously improving the quality of products and processes
TQM
(total quality management)
the time it takes for companies to create new products and bring them to market
new produict development time
describes the speed at which an organization responds to customer requests.
customer response time
the development and implementationof strategies to achieve long term financial, social, and environmental goals
sustainability
consists of selecting an organizations goals ans strategies, predicting results under alternative ways of achieving goals, deciding how to attain the desired goals and communicating the goals and how to achieve them to the entire organization
planning
a quantitiatve expression of a proposed plan of action by management and is an aid to coordinating what needs to be done to execute that plan
- also the most important planning tool when implementing strategy
budget
comprises taking actions that implement the planning decisions, evaluating past performance, and providing feedback and learning to help duture decision making
control
examing past performance and systematically exploring alternative ways to make better-informed decisions and plans in the future
learning
the executive responsible for overseeing the financial operations of an organization
CFO/ finance director
- controllership
- tax
- treasury
- risk management
- investor relations
- strategic planning
areas CFO’s are responsible for
provides financial information for reports to managers and shareholders and oversees the overall operations of the accounting system
which responsibility of the CEO is this ?
controllership
plans income taxes, sales tax, and international taxes
which responsibility of the CEO is this ?
tax
oversees banking, short- and long-term financing investments, and cash management
which responsibility of the CEO is this ?
treasury
manages the financial risk of interest-rate and exchange-rate changes and derivatives management
which responsibility of the CEO is this ?
risk management
communcates with, responds to, and interacts with shareholders
which responsibility of the CEO is this ?
investor relations
defines strategy and allocates resources to implement strategy
which responsibility of the CEO is this ?
strategic planning
financial executive primarily responsible for management accounting and financial accounting
(reporting and interpreting relevant data, influences the behavior of all employees and helps line managers make better decision)
the controller (chief accounting officer)
managers who are directly responsible for attaining the goals of the organization
line management
staff who provide advice, support, and assistance to line management
staff management
