Introduction to management accounting

Question 1

What is accounting?

Answer 1

measuring economic information to permit informed decisions

Question 2

What is management accounting

Answer 2

Measuring and analyzing future information used by management to assure appropriate use for its resources

Question 3

The management cycle

Answer 3

1. Long term and short term planning (economic situations changing such as globalization which will increase labour prices)
2. implementing the plans by directing and motivating
3. Measuring performance (controlling and using big data to collect info)
4. Comparing the actual performance to planned performance
   (leandro imagined meeting connor)

Question 4

Similarities between management accounting and financial accounting

Answer 4

• both are quantitative that measure information
  -both share data sources which intail information from the business

Question 5

Differences between financial and management accounting

Answer 5

-Financial accounting is highly regulated (since there are regulatory bodies like FCA that have more rules since they include external audits, however managerial accountings info is tailed to the needs of managers)
-Management accounting is very detailed since it has financial and non financial information (policies), unlike financial accounting which only has financial information
Management accounting shows future and past performance, whereas financial accounting only shows past performance

Question 6

implications for the role of being a management accountant

Answer 6

before there was an emphasis on achieving the most efficient cost but now the accountants need to be prepared to give the customer value, manage their sustainability and understand technology that supports the decisions that they make

Question 7

Ethics in accounting

Answer 7

ethical accountants need to build trust by promoting loyal and productive relationships with the users

Question 8

CIMA codes of ethics fundamental principles

Answer 8

1. Integrity (be strightforward, fair, honest)
2. Refuse gifts or favours, and communicate favourable and infavourable information)
3. Maintain and develop the knowledge and skills necessary to perform their professional roles
4. Confidentiality (not disclosing information)
5. Professional behaviour (acting as if you were always being inspected)
   IM CPR

Question 9

advantages of management accounting

Answer 9

facilitates communication between different departments by providing a common language for discussing financial information