Firms are now should face a lot of competition because a lot of changes in contemporary business, such as globalization of world trade, changing product life cycle, changing customers tastes that demand to improve levels of service in cost, quality, reliability, delivery and the choice of new products; and the emergence of e-business and so on. As a result of the defects of traditional accounting have been unable to meet these changes new management themes have evolved which in turn has resulted in the development of strategic management accounting.
Strategic management accounting aims to provide relevant information to an organization’s management to enable them to make strategic plans and strategic decisions. The emphasis is on external information on competitors, customers, markets, and environment and so on. Organizations cannot rely on financial information alone – non-financial information also plays an important part of the organizations’ decision making. It can be argued that strategic management accounting has a positive role of supporting the financial needs of management in their task of directing and controlling the business in the best interest of its owners and other stake holders.
Types of management accountants
Management accountants are responsible for the accounting system within organizations. An accounting system should be designed to assist financial and tax reporting for planning and decision-making. In small organizations, to manage the accounting function is usually by a bookkeeper who records the transaction. An external accountant often assists the preparation of financial statements and tax returns. Focus on financial reporting tools, managers may not have relevant information more easily for planning purposes. Control decisions cannot be regarded as important because the manager to make these decisions is likely to be owner.
In large organizations, like Jessup, controller is typically assigned responsibility for management accounting. The controller helps to assist decision-making and reports to the President or Chief Executive Officer (CEO) Manager. The controller was commissioned communication and organization's accounting policies, procedures and implementation of behavior, both consultants and assessment of other departments of the organization's responsibility. The controller may also have assistant controllers who carry out specialized accounting and reporting duties. These controllers’ function is from the finance director, who based, such as investment, financing, banking and credit policy and finance-related transactions are different. Controller is more than just collect information, they often as a strategic planning group and advisory services as a translator and a member of the behavior. Controller is expected to value-added management process.
Jessup is a medium to large company, which is involved in advertising and public relations. In this organization, accountants act the role of controller, who often reports to the four advertising professional directors. Large organizations usually have an internal audit department and the organization's control system work-related. The responsibilities of this department are to achieve appropriate financial and organizational goals to ensure the effective use of business assets. Internal audit staffs keep an eye on the various divisions and departments of the company, and to determine whether the business arrangements are often directly to the Director of Audit Department.
Jessup is a fast growing company that running very well and has reached a stage, but the directors need better management accounting function after the development of their company in the future. So it needs company’s accountants apply professional judgment in deciding what information and methods can be used and how to establish and operate accounting systems within their organization. They undertake problem solving, scorekeeping and attention...
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