Accounting Data in Productivity Measurement and Strategic Decision-Making

Topics: Management accounting, Decision making, Activity-based costing Pages: 13 (4012 words) Published: April 18, 2013
Table of content:
Page number
Executive Summary---------------------------------------------------- 2 Introduction ----------------------------------------------------- 3 What is Cost Accounting? -------------------------------------------- 5 Importance of data collection ---------------------------------------- 6 Accounting data for productivity measurement ----------------- 7 Accounting data for decision making ------------------------------- 9 Identifying profitable segment’s using accounting--------------- 11 Managerial Accounting changes-------------------------------------- 13 Conclusion ---------------------------------------------------------------- 14 Reference ---------------------------------------------------------------- 15

Executive summary:
The report titled ‘Accounting Data in Productivity Measurement and Strategic Decision-Making’ provides an analysis and evaluation of how accounting data is used by companies to promote their profitability and to improve their productivity. Most of the data and information has been collected from online journals. The journals collected were written by renowned professors and researchers from established universities. The journals dealt with not only the importance of data collection for promoting profitable segments but also on the recent change in accounting practices around the world with primary focus on developing countries. Results of the report suggest that data mining is an essential activity for firms who are committed to advance their productivity. The findings also suggest that such information allows for firms to obey their budgets. The report finds that more and more firms have recognized the importance of data collection for their organization and are finding new ways to promote efficient accounting practices. The report also investigates certain limitations of the journals used. The journals are often much generalized rather than using information about a certain organization. Moreover the data provided in the journals ranges over long periods of time through many different firms in many nations. Thus the findings may not be applicable for all firms.

What is managerial accounting?
Managerial accounting is concerned with the provisions and use of accounting information to managers within organizations, to provide them with the basis to make informed business decisions that will allow them to be better equipped in their management and control functions. In contrast to financial accountancy information, management accounting information is: * primarily forward-looking, instead of historical

* model based with a degree of abstraction to support decision making generically, instead of case based * designed and intended for use by managers within the organization, instead of being intended for use by shareholders, creditors, and public regulators * usually confidential and used by management, instead of publicly reported * Computed by reference to the needs of managers, often using management information systems, instead of by reference to general financial accounting standards. According to the Institute of Management Accountants (IMA)-Management accounting is a profession that involves partnering in management decision making, devising planning and performance management systems, and providing expertise in financial reporting and control to assist management in the formulation and implementation of an organization's strategy. Managerial accounting as practice extends to the following three areas: * Strategic management—advancing the role of the management accountant as a strategic partner in the organization. * Performance management—developing the practice of business decision-making and managing the performance of the organization. * Risk management—contributing to frameworks and practices for identifying, measuring, managing and reporting risks to the achievement...
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