Management accounting involves the provision of financial and non-financial information to managers in order to support their activities in the areas of planning, control and decision-making.
In order to make optimal use of such information, it is vital that managers have a sound understanding of the fundamental concepts, principles, and techniques which underpin such management accounting information.
This introductory module is designed to enable participants to develop such an understanding. In doing so, it will draw on some of the concepts and terminology introduced in the earlier Financial Statement Analysis module
Cost analysis & cost assignment:
cost terms, concepts and classifications; cost behaviour; traditional cost assignment; Activity Based Costing.
Budgetary control and variance analysis
budgeting as a tool for planning and control; behavioural considerations; interpretation and investigation of variances; the Beyond Budgeting movement.
Performance Evaluation:
principle of controllability; use of ROI & RI for divisional performance measurement; transfer pricing issues; non-financial performance indicators.
Strategic Management Accounting:
nature of strategic management accounting; customer and product profitability analysis; value chain analysis; activity based management; life cycle costing; target costing; the Balance Scorecard.
Cost-Volume-Profit Relationships:
breakeven point; sensitivity analysis; margin of safety; operating leverage and financial risk; limitations of cost-volume-profit analysis.Pricing: cost-plus pricing; determination of optimum selling price.
Relevant Costing:
distinction between relevant and irrelevant costs; pricing special orders; make or buy decisions; segment closure decisions; decisions regarding the application of single scarce resources.
Ethics:
principles underpinning ethical practice in management accounting; nature of ethical issues which may arise in management accounting.
Participants will be exposed to formal lectures and will also be expected to engage in class discussions. The application of the concepts and the development of critical abilities will be achieved by problem solving
| Module Content & Assessment | |
|---|---|
| Assessment Breakdown | % |
| Formal Examination | 70 |
| Other Assessment(s) | 30 |