This module requires a knowledge and comprehension of Advanced Management Accounting 1 and
Management Accounting 1 and 2. The aim of this module is to further develop skills relevant to
management accounting and build on those skills already developed in previous modules. It aims to assess
those skills in a practical way as well as ensuring students have knowledge of current developments and
thinking relevant to this module.
Decision Making:Relevant Costs and Revenues for Decision Making
Meaning of relevance in decision-making scenarios; cost and revenue analysis under a range of decision-making scenarios: replacement of equipment, outsourcing, make or buy, further processing and discontinuation. Qualitative factors arising in decision-making scenarios; performance analysis in not-for-profit organisations and the public sector; behavioural aspects of performance.
Decision Making: Pricing Decisions
Pricing strategies, including price skimming, penetration pricing and price discrimination; price elasticity of demand; pricing decisions such as price/demand relationships, relevant costs, product life cycles, transfer pricing and profit maximisation; pricing methods: full cost-plus, demand, minimum, tender and variable cost-plus; qualitative factors in pricing.
Decision Making: Risk and Uncertainty
Difference between risk and uncertainty; use of probabilities to calculate expected values and apply sensitivity analysis; decision trees for multi-stage decision problems; differing attitudes to risk and apply maximin, maximax and regret techniques to decision making scenarios.
Planning, Control and Performance Measurement:The Budgeting Process
Different types of budgets, including master budgets and functional budgets, their usefulness and problems; flexing budgets for planning & control purposes and explaining the results using variance analysis; use of high-low technique to identify variable, fixed and semi-variable elements of budgets; estimate the learning effect and apply the learning curve to a budgetary problem; strengths and weaknesses of the traditional budgetary process; behavioural aspects of budgeting; role of forecasts and plans in resource allocation, performance evaluation and control; time series analysis, including moving totals and averages, treatment of seasonality, trend analysis using regression analysis and the application of these techniques to forecasting; different approaches to budgeting, including zero-based budgeting, activity-based budget, incremental budgeting and rolling budgets; beyond budgeting theory and the criticisms of abandoning budgets.
Planning, Control and Performance Measurement: Management Control
Controllability principle; controllable and uncontrollable elements; harmful side-effects of results controls; use of flexible budgeting, variance analysis and subjective evaluations; feedback and feed-forward techniques and how these may be used to assist an organisation in the achievement of its goals; responsibility accounting and the four types of responsibility centres: cost, revenue, profit and investment; contingency theory approach to management accounting.
Information for Planning, Control and Performance Measurement: Standard Costing and Variance Analysis
Variance analysis: sales and cost, mix and yield, planned and operational, idle time, fixed overhead capacity and volume; interpret variances and identify possible causes of same; reconcile actual performance to budgets using marginal and absorption approaches; strengths and weaknesses of standard costing; relevance of standard costing in today's business environment and its future role; role of variance analysis in performance measurement.
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