STRATEGIC COST MANAGEMENT:
Management Accountants – support function ( we recommend, we suggest but we DO
NOT decide.
Objectives:
1. Provide manages with information (internal and special reports) for decision making
and planning
2. Assisting managers in directing and controlling operations
3. Motivating managers toward achieving organization’s goals
4. Measuring performance of managers and sub units within the organization.
Elements of Management Control
1. Planning – set goals and objectives (strategize)
a. Involves choosing goals
b. Includes budget planning
c. Decision making (best option that will fit in the organization)
When plans convert into quantitative it is now BUDGET
2. Controlling – covers both the action that implements the planning and the
performance evaluation (effective (basta nagawa) or efficient (nagawa with least cost
and best outcome)) of the personnel and operations. (ensure that the goal is achieved)
3. Evaluating – part of the control process wherein we evaluate the past performance
and determine the degree of success in accomplishing the plan (Compare the actual
and budget)
Management by exception – consideration of only those items which vary materially
from plans
Financial Accounting – external reporting guided by GAAP (audited by independent
CPA)
Management Accounting – special reports (restricted by cost benefit analysis); (not
audited) (daily or weekly basis)
Cost Accounting – link between FA at MA
Focus and Time Dimension of the Information:
Financial – Relevance and Reliability; Focus on the past
Management – Relevance; focus on future
Line – position in an organization is directly related to the achievement of the
organization’s basic objectives
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Department generally has direct authority over staff departments in an
organization.
Staff – position is supportive in nature, providing service and assistance to other parts of
the organization.
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Department or unit is one that provides services, assistance, and advice to
the departments with line or other staff responsibilities.
Accounting Department
ROLE AND ACTIVITIES OF CONTROLLER AND TREASURER
CONTROLLER – a financial officer responsible for accounting and control and deals
with records, systems, and processes to attain the objectives of internal controls and
good managing.
TREASURER – He serves as the protector of a company’s value and finances from
financial risks that arise from business activities. He deals with money, cash, or wealth
of an organization. He knows the sources of money and exercises prudence in using
the money of an organization.
CONTROLLER
1. Planning and controlling
2. Reporting
3. Evaluating and consulting
4. Government relations, compliance, and reporting
5. Economic appraisal
6. Tax planning and administration
TREASURER – safe guarding of your assets
1. Cash flow management
a. Operating – credit and collection
b. Investing – investments
c. Financing – capital provision, investor relations, short term financing, banking
and custody.
2. Risk management - insurance