This is a summary for the mid-term Management Accounting course. The subject of this midterm is chapters 1 through 7, 9, 11 and 14 of the book Management and Cost Accounting. The summary includes all slides, the effects of assignments on the slides and extra notes taken during the lectures. The sum...
- It measures, analyses and reports financial and non-financial information that are intended
primarily to assist managers in fulfilling the goals of the organization
Management accounting vs. financial accounting
- Management accounting op BU/bedrijfsniveau
- ESG: environmental, social and governmental
Cost accounting: levert informatie aan voor management en financial accounting
- MA: interne kosten
- FA: bv. Voorraadkosten
,Management accounting
- Cost concepts and cost accounting systems
- Cost information for decision making
- Planning and budgeting systems
- Management control & performance issues
Cost-inflation: inflatie door stijgende kosten (corona, oorlog in Ukraine)
Strategic management accounting (SMA): a type of accounting that focuses not only on internal
factors of a company, but factors that are external. This includes industry-wide financials, averages
and upcoming trends
- Costs
- Market trends
- KPI’s
- How to achieve financials and non-financials
- Risk management
- Long-term perspective
The balanced scorecard
- Translates an organization’s mission and strategy into a
comprehensive set of performance measures
- The balanced scorecard does not focus solely on
achieving financial objectives
- It highlights the non-financial objectives that an
organization must achieve in order to meet its financial
objectives
- The scorecard measures an organization’s performance
from four key perspectives
o Financial
o Customer
o Internal business processes
o Learning and growth
Hoorcollege 2
Costs
- “Resource sacrificed to achieve a given objective”
- Usually expressed in monetary terms
- Goal: find out the true costs crucial for decision making
- Terminology
o Part of cost: giving up an alternative = opportunity cost (als je het ene doet, kan je
het andere niet doen)
o Actual versus budgeted costs
, Responsibility accounting
- If decentralized organization structure responsibility centers
- Different types of responsibility centers
o Cost center: accountable for costs
o Revenue center: accountable for revenues
o Profit center: accountable for revenues and costs
o Investment center: accountable for revenues, costs and investments
- Choice of responsibility centers is based on the controllability principle: keep
managers/employees accountable for the items they can control
- Who has the best information/knowledge to explain deviations from targets?
o Not: who can we blame for deviations from targets?
Sort costs
- Direct materials
- Direct labor
- Manufacturing overhead
o Management
o Support staff
o Energy and rent
o Depreciation
o R&D
Cost object: ‘thing’ for which cost information is needed
o Products or product lines
o Departments or business unit
o Projects or programs
o Service
o Activity or process
o Customers
- It depends on individual situation or interest
- Cost = sum of monetary values of all resources needed to achieve the cost object
- Cost accumulation stage 1 bookkeeping
- Cost assignment stage 2 tracing and allocating
- Assigning to departments (cost object) is already difficult, to the product level even more
complex
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