Prologue Flashcards
Differentiate Financial and Managerial Accounting
Financial Accounting: for External Persons, Historical Perspective, Emphasis on Objectivity and Verifiability, Emphasis on Precision, Primarily focus is on company wide report, Must follow GAAP/IFRS, Mandatory
Managerial Accounting: for Managers, Future emphasis, emphasis on relevance, emphasis on timeliness, focus on segment reports, not bound by GAAP/IFRS, Not Mandatory
Enumerate the three main activities of Maagerial Accounting
Planning, Controlling, Decision Making
Enumerate the three objectives of planning
- Establish Goals
- Specify How Goals Will Be Achieved
- Develop Budgets
What is a budget?
A budget is a detailed plan for the future that is usually expressed in formal quantitative terms.
What is Controlling?
Controlling involves gathering feedback and preparing performance reports to ensure that the plan is being properly executed or modified as circumstances change.
What is Decision Making?
Decision Making involves makin a selection among competing alternatives
What are the three questions normally asked in Decision Making?
- What should we be selling?
- Who should we be serving?
- How should we execute?
Enumerate the main business majors
- Marketing Majors
- Operations Management Majors
- HRM Majors
- Accounting Majors
What is a Certified Management Accountant?
A management accountantwho has the necessary qualifications and who passes a rigorous professional exam earns the right to be known as a Certified Management Accountant (CMA).
What is a Strategy?
A strategy is a “game plan” that enables a company to attract customers by distinguishing itself from competitors.
What are the three Customer Value Propositions?
- Customer Intimacy Strategy
- Operational Excellence Strategy
- Product Leadership Strategy
What is Enterprise Risk Management?
A process used by a company to proactively identify and manage risk.
What is Customer Intimacy Strategy?
Understand and respond to individual customer needs.
What is Operational Excellence Strategy?
Deliver products and services faster, more conveniently, and at lower prices.
What is Product Leadership Strategy?
Offer higher quality products
What is a business process?
A business process is a series of steps that are followed in order to carry out some task in a business.
What is Lean Production?
Lean production or Just-In-Time (JIT) Production is a management approach that organizes resources such as people and machines around the flow of business processes and that only produces units in response to customer orders.
What is a Constraint?
A constraint (also called a bottleneck) is anything that prevents you from getting more of what you want. The constraint in a system is determined by the step that has the smallest capacity.
Enumerate the 4-step process in the Theory of Constraints
Identify the weakest link in the chain, which is the constraint.
Do not place a greater strain on the system than the weakest link can handle – if you do, the chain will break.
Concentrate improvement efforts on strengthening the weakest link.
If the improvement efforts are successful, eventually the weakest link will improve to the point that it is no longer the weakest link. At this point, a new weakest link must be identified and the improvement process starts over again.
Enumerate the Six Skills of an Effective Leader
- Technical competence
- High integrity
- Understand how to implement organizational change
- Strong communication skills
- Capable of motivating and mentoring other people
- Effectively manage team-based decision processes
Enumerate the four areas of the IMA Guidelines for Ethical Behavior
- Competence
- Confidentiality
- Integrity
- Credibility
What is Corporate Social Responsibility (CSR)?
Corporate social responsibility (CSR) is a concept whereby organizations consider the needs of all stakeholders when making decisions. CSR extends beyond legal compliance to include voluntary actions that satisfy stakeholder expectations.
Enumerate the 6 main stakeholders of a business
Stakeholders include groups, such as customers, employees, suppliers, communities, stockholders, and environmental and human rights advocates, whose interests are tied to the company’s performance.
What are the two parts that the IMA offers guidelines in the Code of Conduct?
- Ethical Behavior
- Resolution for an ethical conflict
