Managerial Accounting Performance Measures

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J. Llano
Managerial Accounting Performance Measures & Responsibilities

Managerial accounting in simple terms relates to providing information in support of the internal management processes which aids managers to identify, accumulate, analyze, interpret and use collected information to help the company meet its organizational goals. “If it can be measured it can’t be managed” (M.Fowler 2010).In order to obtain the right information to make the right decisions we must set performance measures. Performance measurement is not essential; it is rather an improvement tool to keep business running smoothly. Measuring systems are set in place to aid organizations in setting realistic goals and meeting them efficiently and effectively while allowing managers to make valuable decisions to improve the company’s overall performance in doing the right things, and doing them well while enhancing the organizations business in general. The most basic form of performance measuring is feed back, motivation and incentives.

It is important to assign specific responsibility for different performance measures to different managers and supervisors for the main reason that every department or division within the organization they are managing have different tasks and goals that in one way or another differ from other departments in which case must be managed and measured separately (administrative, engineering & manufacturing, purchasing & inventory, accounting, etc) and then compared as a whole to allocate where the company stands in terms of industry. A prime example of what can be measured in performance is service completeness and quality, production schedules and dead lines, employee skills and turn over, error percentages and customer satisfaction. All the information...
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