Management Accounting

and Control System

(DBA 552)

Presented By: Dr. Richard Oliver F. Cortez, MBA, DBA, FRIBA, AFBE
AMA University
COURSE DESCRIPTION:

This course deals with the application of techniques

and concepts focusing on segment reporting,
profitability analysis, and decentralization; information
for decision-making purposes (short-term and long-
term) and non-financial indicators such as productivity
per employee or per service unit; decision making
affecting short-run operations of the company; capital
budgeting decisions; pricing of goods and services; and
environmental cost accounting.
Upon successful completion of the course, the
student will be able to:
1. Explain and discuss the concepts, nature and importance of
responsibility accounting, the various responsibility centers and the
related performance evaluation concepts.
2. Be able to discuss, explain and apply in problem-solving on
quantitative techniques in planning and control.
3. Explain and discuss the concepts, rationale and techniques on
managing quality improvements.
4. Describe the work dimensions for accountants involved in
management advisory services.
5. Appreciate and apply the fundamental concepts and techniques in
capital budgeting and strategic
TOPICS TO BE COVERED:
• The Management Process in Organization
• What is managerial accounting?
• Management activities
• Decision making
• Planning
• Directing operational activities
• Controlling
LEARNING OUTCOMES:

• Define managerial accounting and describe its role in the

management process
• Develop the four fundamental management processes that
help organizations attain their goals.
• Find and describe five objectives of managerial accounting
activity
• Implement the differences in roles between managerial and
financial accounting
• Appreciate the value of managerial accounting in business
• Be familiar with numerical solutions in business problems
Define Managerial Accounting

Managerial accounting is the process of

 Identifying
 Measuring
 Analyzing
 Interpreting
 Communicating information
 Managing Resources, Activities, and People
An organization . . .
Directing

Decision
Acquires Resources Making
Organized set
of activities

Controlling Planning

Hires People
 How Managerial Accounting Adds Value to
the Organization
• Providing information for decision making and planning.
• Assisting managers in directing and controlling activities.
• Motivating managers and other employees towards
organization’s goals.
• Measuring performance of subunits, activities, managers,
and other employees.
• Assessing the organization’s competitive position.
Managerial versus Financial Accounting
Accounting System
(accumulates financial and
managerial accounting data in the
cost accounting system)

Managerial Accounting Financial Accounting

Information for decision Published financial
making, planning, and statements and other
controlling an organization’s financial reports.
operations.

Internal External
Users Users
 Line and Staff Positions
• A line position is directly • A staff position supports and
involved in achieving the assists line positions.
basic objectives of an – Example: A cost
organization. accountant in the
manufacturing plant.
– Example: A production
supervisor in a
manufacturing plant.
 Controller
The chief managerial and financial accountant
responsibility for:
– Supervising accounting personnel
– Preparation of information and reports, managerial
and financial
– Analysis of accounting information
– Planning and decision making
 Treasurer
Responsible for raising capital and safeguarding the
organization’s assets.
– Supervises relationships with financial institutions.
– Work with investors and potential
investors.
– Manages investments.
– Establishes credit policies.
– Manages insurance coverage

1-12
 Internal Auditor
Responsible for reviewing accounting procedures, records, and
reports in both the controller’s and the treasurer’s area of
responsibility.
– Expresses an opinion to top
management regarding the
effectiveness of the
organizations accounting
system.

1-13
 Cost Management Systems
Objectives
Measure the cost of
resources consumed.
Identify and eliminate
non-value-added costs. Cost
Management
System

1-14
 CREDIT

goes to for the images

used in the presentation
Thank you very
much for
listening!