This module aims to provide students with a comprehensive understanding of the role of the Management
Accountant. The students should be able to apply management accounting techniques to cost products and
services. This knowledge provides the student with techniques relevant to problem solving in a work
The scope of Management Accounting
The history and development of management accounting; the function of management accounting; comparison of the relationshipbetween management and financial accounting and the role of the management accountant in the changing competitiveenvironment; compare and contrast management reports used in a commercial enterprise, a charity and the public sector.
Cost and revenue classification
Classification of costs and revenues into direct and indirect, period and product, opportunity costs, avoidable and unavoidable,incremental, variable, fixed, semi-variable, stepped, decision making costs and non-manufacturing costs.
Accounting for materials and labour
Components of product costing; materials controls procedure, pricing and valuation of inventories (FIFO, LIFO and WeightedAverage); use of quantitative modules for planning and control of inventories (EOQ, MRP, TQM and JIT); accounting for payrolland labour; incentive schemes; remuneration methods; labour turnover ratio and labour efficiency ratio.
Accounting for overheads
Traditional approach to overhead absorption; calculation of overhead absorption rates; pricing jobs and services for customers;profit calculation using mark-up and margin; plant-wide rates versus individual rates; calculation of under-absorbed and overabsorbedoverheads; criticisms of the traditional overhead absorption approach; activity-based costing approach to overheadallocation.
Service and operation costing
Identify situations where the use of service/operation costing is appropriate and carry out service cost analysis in service industrysituations.
Differences between job costing and process costing; calculation of the average cost per unit using a process costing system;ledger accounts showing the accounting treatment of normal losses, abnormal losses and abnormal gains; accounting for sale ofscrap; calculation of the average cost per unit using the statement of equivalent units where there is closing work-in-progress;previous process costs; calculation of the average cost per unit using weighted average and FIFO where there is opening workin-progress; accounting for joint products and by-products.
Management accounting and Advanced Management Accounting are practical subjects with an emphasis on creating management information to assist in decision making and to assess the performance of the business. The teaching strategy is one where the students are required to be actively engaged in the learning process both inside and outside the classroom. Students learn at different paces and teaching styles are adapted to the learning needs of students while all the time ensuring that topics are covered, and exemptions retained. Students are encouraged to ask questions in class, to follow lecturers illustrating practical examples and to then work through similar questions individually or in groups to complete questions. Lecturers illustrate the solution which is then uploaded to Moodle so that students can work independently. All topics are underpinned by theory and current research in the area. Lecturers use PowerPoint slides, textbooks, worksheets, past exam papers, video clips and encourage class discussions. Students are encouraged to refer to other textbooks and journals to supplement their learning. Problem solving is emphasised in these modules and students become not only independent learners, but they learn to collaborate with fellow students. This forms the basis of skills required by the Management Accountant in practice. Management accounting spans many aspects of a business, so topics are linked to other modules including Financial Accounting, Economics and Financial Management were relevant. Students are encouraged to solve problems and make decisions considering different aspects of the business. Management accounting constantly adapts to the changing business environment, and the topics in these modules are updated as deemed appropriate and with reference to the Professional Accounting bodies. Evolving areas: Sustainability measurement and reporting is key to the activities that have a direct impact on society, environment, and economic performance of an organisation.
|Module Content & Assessment