CHAPTER 1: OBJECTIVES , ROLE AND SCOPE OF MANAGEMENT ACCOUNTING

Question 1

Basic Management Functions

Answer 1

1. Planning
2. Directing and Motivating
3. Controlling

Question 2

Planning

Answer 2

it establish a strategy or selecting a course of action and how the action will be implemented

Question 3

Directing and Motivating

Answer 3

• take action to implement the plan
• motivate others to achieve result

Question 4

Controlling

Answer 4

ensuring that the plan is actually carried out and is modified as circumstances changes

Question 5

Difference of FA vs MA in User Perspective?

Answer 5

FA - for external users

MA - for internal users

Question 6

Difference of FA vs MA in Types of Reports/ Information

Answer 6

FA - FS primarily monetary (financial) in nature

MA - Monetary and Non-Monetary report

Question 7

Difference of FA vs MA in Guiding Principle

Answer 7

FA - Generally Accepted Accounting Principles (GAAP)

MA - None

Question 8

Difference of FA vs MA in its Purpose

Answer 8

FA - financial reporting and compliance

MA - decision-making, planning and control

Question 9

Difference of FA vs MA in Time Orientation

Answer 9

FA - historical (past) data

MA - future oriented using current and past data

Question 10

Difference of FA vs MA about the Level of Detail

Answer 10

FA - focus mainly on business as a whole

MA - extensive and detail

Question 11

Difference of FA vs MA as Necessity

Answer 11

FA - mandatory

MA - optional

Question 12

Difference of FA vs MA in Source of Data

Answer 12

FA - from internal information system

MA - from internal and external sources

Question 13

Controllership

Answer 13

process to assure the the resources are obtained and utilized according to the plans

Question 14

Controller

Answer 14

• 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

Question 15

Treasurer

Answer 15

• responsible for raising the capital
• safeguarding the assets
• managing its investment

Question 16

Internal Auditor

Answer 16

reviewing the accounting procedures records and reports in both controller’s and treasurer’s responsibility, in where he express an opinion regarding the assertions

Question 17

Competence

Answer 17

Maintain an appropriate level of professional expertise

Question 18

Professional Ethics (ICCC)

Answer 18

refers to the standard of conduct for judging the right from wrong, honest to dishonest and fair from unfair

1. Integrity
   2 Competence
2. Confidentiality
3. Credibility

Question 18

Integrity

Answer 18

mitigate actual conflict of interest

Question 19

Confidentiality

Answer 19

keep the information confidential

Question 19

Credibility/ Objectivity

Answer 19

• communicate the information fairly
• disclose all relevant information

Question 20

Line Function

Answer 20

direct relationship towards the operation of the business

Question 20

Staff position

Answer 20

support the line position from operating the business

Question 21

Management by Objectives

Answer 21

a procedure in which a subordinate and a supervisor agree on

1. goals
2. methods of achieving them and develop a plan in accordance with that agreement

Question 22

Management by Exception

Answer 22

It is where the time should be spend in activities that are non-routine being identified as top priority