“The Changing Role of Managerial Accounting and the Managerial Accounting Profession in Romania”
Managerial accounting has historical antecedents that stretch back to the beginning of the 1900s. Whether it was called cost accounting, or industrial accounting, or administrative accounting it is certain that concerns regarding production cost calculation, expenses’ classification and analysis, resource consumption administration, and pre and post cost calculations, have existed since the beginning of the 90s (Cardos & Cardos, 2010).
Simon (1978) conducted a study about the role managerial accounting. In his opinion managers have three major expectations regarding to management accounting roles: scorekeeping (capturing,
Managerial accountants need to use accounting information in seeing to it that they are able to plan, evaluate the company performance, manage risks and control the business operations in a manner that is deemed beneficial to the business as a whole (Caplan, n. d). This can be achieved through: having high standards of ethics in all situations; employing the techniques of management reports, budgetary control, and analysis of fund flows and financial statements; making prudent capital investment decisions; and maintaining continuous quality control systems.
Managerial Accounting is vital to a business’s success because it quantifies a firm’s performance. By quantifying certain performance variables, senior management can carry out its two most important functions: 1) Decision-Making/Planning and 2) Controlling Employee Behaviour.
Management accounting in organisation is very important for decision-making and to make the business more efficient and therefore increasing its profits. Is the process of preparing accounts that can help managers to make day-to-day and short-term decisions, by providing them with accurate and timely key financial and statistical information...
In Financial Accounting accountants prepare only the annual finance statement of any organization and shows if the organization is going in profit or loss. But in Management Accounting the managers have to take the future decisions and steps by looking at the past financial statements. So Management Accounting is very important because one wrong decision can transfer the organizations path or the future. Management Accountants have a responsibility to moral qualities which has to be kept intact by using their various skills, which will ultimately help the shareholders of any organization to retain profits earned from the money invested. Strategy formation by executing plans, budgeting and forecasting, risk management and decision making all these are required as skills in Management Accounting. In Management Accounting a manager has to have knowledge on both the financial and non-financial terms of the business and operational sides of the business. Both the financial and non-financial items are reported and analyzed by the managers to come to any decision. Again, the corporate social performance is also analyzed and a report is made on that. They have to take care of the other points also, i. e, profit of the organization, the final and end users, i. e ,customers and their satisfaction levels, employees of the organization, environmental matters related to the
Financial and Managerial accounting are used for making sound financial decisions about an organization. They provide information of past quantitative financial activities and are useful in making future economic decisions. (Albrecht, Stice, Stice, & Skousen, 2002) The same financial data is used to derive reports for each accounting process yet they differ in some ways. Financial accounting primarily provides external reports for external users such as stock holders, creditors, regulating authority and others. (Garrison, Noreen, & Brewer, 2010) On the other hand Managerial accounting is concern with providing information that deals with the internal viability of the organization and is tailored to meet the needs of an individual organization. (Albrecht, Stice, Stice, & Skousen, 2002)
Accounting dates back as far as first centuries, is the language of business. As everything has gone through many changes, accounting has also changed many times through out the centuries. It went from the use of abacus to the most advanced softwares, and computers. With these drastic improvements nowadays accounting, financial accounting and management are facing big challenges. From the presentation of the reports to communication to the users, investors, and owners, the accounting field has gained totally a new shape from two decades ago. Today with the dynamic change in every aspect of life, the accounting field has to act fast and be able to adapt these new changes and challenges in order to survive.
In Management, the accountant gives advices to the individuals and business people, how to manage their business. The account information is considered and some business decisions are taken in both financial and non-financial departments. Budgeting, tax filing, and financial statements. Other activities like involve in planning com...
Accounting is so important in our modern society. It serves a variety range of place in our society. It serves a variety range of place in our soceity, from school to hospital, from business firm to government agencies. It's also the main force in regulation of taxation and industrial activity. It serves a great aspects on the development of mass-production systems, any way, it's a very important term in our modern soceity.
Comparimg and Contrasting Financial Managerial Acctounting
American Public University
Financial accounting is the analysis, classification, and recording of financial transactions and reporting such information to respective users especially external users who use the information to make decisions about their engagements with the entity. In financial accounting general purpose financial statements are used for external reporting. The public by standards imposes the development of the statements through respective national professional bodies, International Accounting Standards Board and respective company Acts for various nations.
On the other hand, managerial accounting is category of accounting that provides special purpose statements, and it reports to management and other persons inside the