Managerial Accounting Essay
Management accounting refers to a function of tracking internal cost for any business process that helps an organization, firm or an individual in making decisions related to production, operation and investment in market. Unlike financial accounting managerial accounting uses information for the companies’ sake and financial is more for parties outside the organization. The person behinds this position places a significant role in how a company functions from day to day. The role of a management accountant is thus, very crucial for a firm’s well being that even a single miscalculation or underestimation of any business plan by a management accountant can put a company’s future in danger. According to (all business school) the role of the management accountant is to perform a series of tasks to ensure their companys financial security, handling essentially all financial matters and thus helping to drive the businesss overall management and strategy (all business school 2015). They are also required to specialize in collecting, recording and reporting financial data from several units of an organization, observe and analyze their budget and suggest their funding and allocation.
Some examples of management accounting tasks performed by individuals are budgeting, cost determination, cost recording, cost analyzing, and cost reporting. How has the role of the managerial accountant in todays business environment? How has the role changed and evolved over time? The role of managerial accountant plays a very important role in todays business environment. Companies nowadays need to have a solid managerial accountant to prepare curtains financial documents to maintain a balance within the company. Companies are now able to strategically plan for the operation ahead of time within a particular budget. The role changed and evolved over time do to its tracking and “collecting data, designing the information system, analyzing the same and using information in formulation and execution of the strategy” (Bhattacharya 2009). “Management accounting has moved from transaction and compliance orientation to that of strategic business partner – to be steward of corporate performance management, planning and budgeting; champions of corporate governance process, providing risk management, internal control, and financial reporting at the time of great change; and experts in cost management methods that help the organization to become more competitive and successful” (Bhattacharya 2009). With being more of a business partner to company managerial accountant has moved from the bottom of the totem pole to the top.