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Management Accounting

2012-01-10T15:22:37Z

Geofferycheung: Created page with "'''Management accounting''' or '''managerial accounting''' is concerned with the provisions and use of accounting information to managers within organizations, to provide the..."

'''Management accounting''' or '''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 system]]s, instead of by reference to general financial accounting standards.

==Definition==

According to the [[Chartered Institute of Management Accountants]] (CIMA), Management Accounting is ''"the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of information used by management to plan, evaluate and control within an entity and to assure appropriate use of and accountability for its resources. Management accounting also comprises the preparation of financial reports for non-management groups such as shareholders, creditors, regulatory agencies and tax authorities"''(CIMA Official Terminology).

The [[Institute of Management Accountants]] (IMA)[http://www.imanet.org/ima_home.aspx] recently updated its definition as follows: ''"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"''.

The American Institute of Certified Public Accountants(AICPA) states that management 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 of the objectives of the organization.

The Institute of Certified Management Accountants(ICMA), states ''"A management accountant applies his or her professional knowledge and skill in the preparation and presentation of financial and other decision oriented information in such a way as to assist management in the formulation of policies and in the planning and control of the operation of the undertaking"''. Management Accountants therefore are seen as the "value-creators" amongst the accountants. They are much more interested in forward looking and taking decisions that will affect the future of the organization, than in the historical recording and compliance (score keeping) aspects of the profession. Management accounting knowledge and experience can therefore be obtained from varied fields and functions within an organization, such as information management, treasury, efficiency auditing, marketing, valuation, pricing, logistics, etc.

==Role within a corporation==
Consistent with other roles in today's corporation, management accountants have a dual reporting relationship. As a strategic partner and provider of decision based financial and operational information, management accountants are responsible for managing the business team and at the same time having to report relationships and responsibilities to the corporation's finance organization.

The activities management accountants provide inclusive of forecasting and planning, performing variance analysis, reviewing and monitoring costs inherent in the business are ones that have dual accountability to both finance and the business team. Examples of tasks where accountability may be more meaningful to the business management team vs. the corporate finance department are the development of new product costing, [[operations research]], business driver metrics, sales management scorecarding, and client profitability analysis. See [[Financial modeling]]. Conversely, the preparation of certain financial reports, reconciliations of the financial data to source systems, risk and regulatory reporting will be more useful to the corporate finance team as they are charged with aggregating certain financial information from all segments of the corporation.

In corporations that derive much of their profits from the information economy, such as banks, publishing houses, telecommunications companies and defence contractors, IT costs are a significant source of uncontrollable spending, which in size is often the greatest corporate cost after total compensation costs and property related costs. A function of management accounting in such organizations is to work closely with the IT department to provide [[IT Cost Transparency]].<ref>* "Taking Control of IT Costs". Nokes, Sebastian. London (Financial Times / Prentice Hall): March 20, 2000. ISBN 978-0-273-64943-4</ref>

Given the above, one widely held view of the progression of the accounting and finance career path is that financial accounting is a stepping stone to management accounting. Consistent with the notion of value creation, management accountants help drive the success of the business while strict financial accounting is more of a compliance and historical endeavor.

===An alternative view===
A very rarely expressed alternative view of management accounting is that it is neither a neutral or benign influence in organizations, rather a mechanism for management control through surveillance. This view locates management accounting specifically in the context of management control theory. Stated differently, Management Accounting information is the mechanism which can be used by managers as a vehicle for the overview of the whole internal structure of the organization to facilitate their control functions within an organization.

==Management accounting tasks/ services provided==
Listed below are the primary tasks/ services performed by management accountants. The degree of complexity relative to these activities are dependent on the experience level and abilities of any one individual.
* [[Rate and volume analysis]]
* [[Business metrics development]]
* [[Price modeling]]
* [[Product profitability]]
* Geographic vs. Industry or [[client segment reporting]]
* [[Sales management scorecards]]
* [[Cost analysis]]
* [[Cost–benefit analysis]]
* [[Cost-volume-profit analysis]]
* [[Whole-life cost|Life cycle cost analysis]]
* [[Client profitability analysis]]
* [[IT cost transparency]]
* [[Capital budgeting]]
* [[Buy vs. lease analysis]]
* [[Strategic planning]]
* [[Strategic management advice]]
* [[Internal financial presentation and communication]]
* [[Sales forecasting]]
* [[Financial forecasting]]
* [[Annual budgeting]]
* [[Cost allocation]]

==External links==
* [http://www.CAM-I.org CAM-I Consortium for Advanced Manufacturing–International]
* [http://fmcenter.aicpa.org/ AICPA Financial Management Center] – Resource for CPAs working in business, industry and government.
* [http://www.snowdropkcs.co.uk/ SnowdropKCS | Payroll Software and Payroll Management Services] - Additional information in regards to managerial accounting software for businesses
* [http://www.imanet.org/ Institute of Management Accountants] – Resource for Management accountants (CMA's) working in industry.
* [http://www.cimaglobal.com/ Chartered Institute of Management Accountants] – Chartered Institute of Management Accountants
* [http://www.starplc.com/ Stars Computers Ltd | Practice Management Software ] - Leading accountancy firm in management software

==References==
{{Reflist}}

Accounting

2012-01-10T15:15:40Z

Geofferycheung:

'''Accounting''' is the method by which an organization measures the use of [[asset|assets]] and [[liability|liabilities]] against [[money]]. It is an indispensable tool and prerequisite to modern day capitalism.<ref name="weber">[[Max Weber]], ''General Economic History'', trans. Frank H. Knight (New York, NY: Collier Books, 1961) 208-209</ref> Double book entry accounting is a method by which every economic action must affect two accounts so that they balance in the equation:<blockquote>'''[[Asset|Assets]] - [[Liability|Liabilities]] = [[Equity]]'''</blockquote>
== Recent Developments ==

Modern day capital accounting in the [[United States]] is under the standard Generally Accepted Accounting Principles ([[GAAP]]). The Securities and Exchange Commission ([[SEC]]) has proposed a movement to international financial reporting standards or [[IFRS]].

[[Economic calculation]] directs the actions of individual business persons. "Economic logic prevails over the technological," says Schumpeter.<ref name="schumpeter_economic_logic">[[Joseph Schumpeter]], ''The Theory of Economic Development'', trans. Redvers Opie (Cambridge, Massachusetts: Harvard University Press, 1961) 14</ref> The transition to a world standard of accounting may impart some benefits, for example: "...in more efficient functioning of [[capital markets]] and a lower [[cost of capital]] for the economy as a whole." <ref name="SFAC_8">Statement of Financial Accounting Concepts, No. 8 [http://www.fasb.org/cs/BlobServer?blobcol=urldata&blobtable=MungoBlobs&blobkey=id&blobwhere=1175821997186&blobheader=application/pdf] QC37</ref> In sum, the method of economic calculation has importance in economic analysis.

==Specific concepts==
===Cost accounting===
Cost accounting is a central element of managerial accounting.

===Grenzplankostenrechnung (GPK)===
{{main|Grenzplankostenrechnung (GPK)}}

Grenzplankostenrechnung is a German costing methodology, developed in the late 1940s and 1950s, designed to provide a consistent and accurate application of how managerial costs are calculated and assigned to a product or service. The term Grenzplankostenrechnung, often referred to as GPK, has best been translated as either ''Marginal Planned Cost Accounting''<ref>{{cite journal|last=Friedl|first=Gunther|coauthors=Hans-Ulrich Kupper and Burkhard Pedell|title=Relevance Added: Combining ABC with German Cost Accounting|journal=Strategic Finance|issue=June|pages=56–61|year=2005}}</ref> or ''Flexible Analytic Cost Planning and Accounting''.<ref>{{cite journal|last=Sharman|first=Paul A.|title=Bring On German Cost Accounting|journal=Strategic Finance|issue=December|pages=2–9|year=2003}}</ref>

The origins of GPK are credited to Hans Georg Plaut, an automotive engineer and Wolfgang Kilger, an academic, working towards the mutual goal of identifying and delivering a sustained methodology designed to correct and enhance cost accounting information. GPK is published in cost accounting textbooks, notably ''Flexible Plankostenrechnung und Deckungsbeitragsrechnung''<ref>{{cite book|last=Kilger|first=Wolfgang|others=Updated by Kurt Vikas and Jochen Pampel|title=Flexible Plankostenrechnung und Deckungsbeitragsrechnung|edition=12th|publisher=Gabler GmbH|location=Wiesbaden,Germany|year=2002}}</ref> and taught at German-speaking universities today.

===Lean accounting (accounting for lean enterprise)===
{{main|Lean accounting}}
In the mid- to late-1990s several books were written about accounting in the lean enterprise (companies implementing elements of the [[Toyota Production System]]). The term lean accounting was coined during that period. These books contest that traditional accounting methods are better suited for mass production and do not support or measure good business practices in just-in-time manufacturing and services. The movement reached a tipping point during the 2005 Lean Accounting Summit in Dearborn, MI. 320 individuals attended and discussed the merits of a new approach to accounting in the lean enterprise. 520 individuals attended the 2nd annual conference in 2006.

===Resource consumption accounting (RCA)===
{{main|Resource Consumption Accounting}}
Resource Consumption Accounting (RCA) is formally defined as a dynamic, fully integrated, principle-based, and comprehensive management accounting approach that provides managers with decision support information for enterprise optimization. RCA emerged as a management accounting approach around 2000 and was subsequently developed at [http://www.CAM-I.org CAM-I] the Consortium for Advanced Manufacturing–International, in a [http://www.cam-i.org/displaycommon.cfm?an=1&subarticlenbr=30 Cost Management Section ''RCA interest group''] in December 2001.

===Throughput accounting===
{{main|Throughput accounting}}
The most significant recent direction in managerial accounting is throughput accounting; which recognizes the interdependencies of modern production processes. For any given product, customer or supplier, it is a tool to measure the contribution per unit of constrained resource.

===Transfer pricing===
{{main|Transfer pricing}}
Management accounting is an applied discipline used in various industries. The specific functions and principles followed can vary based on the industry. Management accounting principles in banking are specialized but do have some common fundamental concepts used whether the industry is manufacturing based or service oriented. For example, transfer pricing is a concept used in manufacturing but is also applied in banking. It is a fundamental principle used in assigning value and revenue attribution to the various business units. Essentially, transfer pricing in banking is the method of assigning the interest rate risk of the bank to the various funding sources and uses of the enterprise. Thus, the bank's corporate treasury department will assign funding charges to the business units for their use of the bank's resources when they make loans to clients. The treasury department will also assign funding credit to business units who bring in deposits (resources) to the bank. Although the funds transfer pricing process is primarily applicable to the loans and deposits of the various banking units, this proactive is applied to all assets and liabilities of the business segment. Once transfer pricing is applied and any other management accounting entries or adjustments are posted to the ledger (which are usually memo accounts and are not included in the legal entity results), the business units are able to produce segment financial results which are used by both internal and external users to evaluate performance.


==Resources and continuous learning==
There are a variety of ways to keep current and continue to build one's knowledge base in the field of management accounting. Certified Management Accountants (CMAs) are required to achieve continuing education hours every year, similar to a Certified Public Accountant. A company may also have research and training materials available for use in a corporate owned library. This is more common in "[[Fortune 500]]" companies who have the resources to fund this type of training medium.

There are also numerous journals, on-line articles and blogs available. The journal ''Cost Management'' ({{ISSN|1092-8057}})<ref>{{cite web|url=http://ria.thomsonreuters.com/estore/printdetail.aspx?ID=ZMCMP |title=Cost Management |publisher=Thomson Reuters |date=2011 |accessdate=November 12, 2011}}</ref> and the [http://www.imanet.org/publications_maq.asp Institute of Management Accounting] (IMA) site are sources which includes [[Management Accounting]] Quarterly] and ''Strategic Finance'' publications. Indeed, management accounting is needed in an organization.

===Related qualifications===
There are several related professional qualifications and certifications in the field of accountancy including:
* Management Accountancy Qualifications
** [[Chartered Institute of Management Accountants|CIMA]]
** [[Institute of Certified Management Accountants|ICMA]]
** [[Certified Management Accountant|CMA]]
* Other Professional Accountancy Qualifications
** [[Chartered Institute of Public Finance and Accountancy]], CIPFA
** [[Chartered Certified Accountant]], ([[Association of Chartered Certified Accountants|ACCA]])
** [[Chartered Accountant]], ([[Chartered accountant|CA]])
** [[Certified Public Accountant]], ([[Certified Public Accountant|CPA]])
*** [[American Institute of Certified Public Accountants]]
** [[CPA Australia|Certified Practicing Accountant]] (CPA Australia)
** [[Chartered Global Management Accountant]]

==References==
{{Reflist}}

{{Stub}}
[[Category:Economic concepts]]

Accounting

2012-01-10T15:11:57Z

Geofferycheung:

'''Accounting''' is the method by which an organization measures the use of [[asset|assets]] and [[liability|liabilities]] against [[money]]. It is an indispensable tool and prerequisite to modern day capitalism.<ref name="weber">[[Max Weber]], ''General Economic History'', trans. Frank H. Knight (New York, NY: Collier Books, 1961) 208-209</ref> Double book entry accounting is a method by which every economic action must affect two accounts so that they balance in the equation:<blockquote>'''[[Asset|Assets]] - [[Liability|Liabilities]] = [[Equity]]'''</blockquote>
== Recent Developments ==

Modern day capital accounting in the [[United States]] is under the standard Generally Accepted Accounting Principles ([[GAAP]]). The Securities and Exchange Commission ([[SEC]]) has proposed a movement to international financial reporting standards or [[IFRS]].

[[Economic calculation]] directs the actions of individual business persons. "Economic logic prevails over the technological," says Schumpeter.<ref name="schumpeter_economic_logic">[[Joseph Schumpeter]], ''The Theory of Economic Development'', trans. Redvers Opie (Cambridge, Massachusetts: Harvard University Press, 1961) 14</ref> The transition to a world standard of accounting may impart some benefits, for example: "...in more efficient functioning of [[capital markets]] and a lower [[cost of capital]] for the economy as a whole." <ref name="SFAC_8">Statement of Financial Accounting Concepts, No. 8 [http://www.fasb.org/cs/BlobServer?blobcol=urldata&blobtable=MungoBlobs&blobkey=id&blobwhere=1175821997186&blobheader=application/pdf] QC37</ref> In sum, the method of economic calculation has importance in economic analysis.

==Specific concepts==
===Cost accounting===
Cost accounting is a central element of managerial accounting.

===Grenzplankostenrechnung (GPK)===
{{main|Grenzplankostenrechnung (GPK)}}

Grenzplankostenrechnung is a German costing methodology, developed in the late 1940s and 1950s, designed to provide a consistent and accurate application of how managerial costs are calculated and assigned to a product or service. The term Grenzplankostenrechnung, often referred to as GPK, has best been translated as either ''Marginal Planned Cost Accounting''<ref>{{cite journal|last=Friedl|first=Gunther|coauthors=Hans-Ulrich Kupper and Burkhard Pedell|title=Relevance Added: Combining ABC with German Cost Accounting|journal=Strategic Finance|issue=June|pages=56–61|year=2005}}</ref> or ''Flexible Analytic Cost Planning and Accounting''.<ref>{{cite journal|last=Sharman|first=Paul A.|title=Bring On German Cost Accounting|journal=Strategic Finance|issue=December|pages=2–9|year=2003}}</ref>

The origins of GPK are credited to Hans Georg Plaut, an automotive engineer and Wolfgang Kilger, an academic, working towards the mutual goal of identifying and delivering a sustained methodology designed to correct and enhance cost accounting information. GPK is published in cost accounting textbooks, notably ''Flexible Plankostenrechnung und Deckungsbeitragsrechnung''<ref>{{cite book|last=Kilger|first=Wolfgang|others=Updated by Kurt Vikas and Jochen Pampel|title=Flexible Plankostenrechnung und Deckungsbeitragsrechnung|edition=12th|publisher=Gabler GmbH|location=Wiesbaden,Germany|year=2002}}</ref> and taught at German-speaking universities today.

===Lean accounting (accounting for lean enterprise)===
{{main|Lean accounting}}
In the mid- to late-1990s several books were written about accounting in the lean enterprise (companies implementing elements of the [[Toyota Production System]]). The term lean accounting was coined during that period. These books contest that traditional accounting methods are better suited for mass production and do not support or measure good business practices in just-in-time manufacturing and services. The movement reached a tipping point during the 2005 Lean Accounting Summit in Dearborn, MI. 320 individuals attended and discussed the merits of a new approach to accounting in the lean enterprise. 520 individuals attended the 2nd annual conference in 2006.

===Resource consumption accounting (RCA)===
{{main|Resource Consumption Accounting}}
Resource Consumption Accounting (RCA) is formally defined as a dynamic, fully integrated, principle-based, and comprehensive management accounting approach that provides managers with decision support information for enterprise optimization. RCA emerged as a management accounting approach around 2000 and was subsequently developed at [http://www.CAM-I.org CAM-I] the Consortium for Advanced Manufacturing–International, in a [http://www.cam-i.org/displaycommon.cfm?an=1&subarticlenbr=30 Cost Management Section ''RCA interest group''] in December 2001.

===Throughput accounting===
{{main|Throughput accounting}}
The most significant recent direction in managerial accounting is throughput accounting; which recognizes the interdependencies of modern production processes. For any given product, customer or supplier, it is a tool to measure the contribution per unit of constrained resource.

===Transfer pricing===
{{main|Transfer pricing}}
Management accounting is an applied discipline used in various industries. The specific functions and principles followed can vary based on the industry. Management accounting principles in banking are specialized but do have some common fundamental concepts used whether the industry is manufacturing based or service oriented. For example, transfer pricing is a concept used in manufacturing but is also applied in banking. It is a fundamental principle used in assigning value and revenue attribution to the various business units. Essentially, transfer pricing in banking is the method of assigning the interest rate risk of the bank to the various funding sources and uses of the enterprise. Thus, the bank's corporate treasury department will assign funding charges to the business units for their use of the bank's resources when they make loans to clients. The treasury department will also assign funding credit to business units who bring in deposits (resources) to the bank. Although the funds transfer pricing process is primarily applicable to the loans and deposits of the various banking units, this proactive is applied to all assets and liabilities of the business segment. Once transfer pricing is applied and any other management accounting entries or adjustments are posted to the ledger (which are usually memo accounts and are not included in the legal entity results), the business units are able to produce segment financial results which are used by both internal and external users to evaluate performance.


==Resources and continuous learning==
There are a variety of ways to keep current and continue to build one's knowledge base in the field of management accounting. Certified Management Accountants (CMAs) are required to achieve continuing education hours every year, similar to a Certified Public Accountant. A company may also have research and training materials available for use in a corporate owned library. This is more common in "[[Fortune 500]]" companies who have the resources to fund this type of training medium.

There are also numerous journals, on-line articles and blogs available. The journal ''Cost Management'' ({{ISSN|1092-8057}})<ref>{{cite web|url=http://ria.thomsonreuters.com/estore/printdetail.aspx?ID=ZMCMP |title=Cost Management |publisher=Thomson Reuters |date=2011 |accessdate=November 12, 2011}}</ref> and the [http://www.imanet.org/publications_maq.asp Institute of Management Accounting] (IMA) site are sources which includes [[Management Accounting Quarterly]] and ''Strategic Finance'' publications. Indeed, management accounting is needed in an organization.

===Related qualifications===
There are several related professional qualifications and certifications in the field of accountancy including:
* Management Accountancy Qualifications
** [[Chartered Institute of Management Accountants|CIMA]]
** [[Institute of Certified Management Accountants|ICMA]]
** [[Certified Management Accountant|CMA]]
* Other Professional Accountancy Qualifications
** [[Chartered Institute of Public Finance and Accountancy]], CIPFA
** [[Chartered Certified Accountant]], ([[Association of Chartered Certified Accountants|ACCA]])
** [[Chartered Accountant]], ([[Chartered accountant|CA]])
** [[Certified Public Accountant]], ([[Certified Public Accountant|CPA]])
*** [[American Institute of Certified Public Accountants]]
** [[CPA Australia|Certified Practicing Accountant]] (CPA Australia)
** [[Chartered Global Management Accountant]]

==References==
{{Reflist}}

{{Stub}}
[[Category:Economic concepts]]

Accounting

2012-01-10T15:11:14Z

Geofferycheung:

'''Accounting''' is the method by which an organization measures the use of [[asset|assets]] and [[liability|liabilities]] against [[money]]. It is an indispensable tool and prerequisite to modern day capitalism.<ref name="weber">[[Max Weber]], ''General Economic History'', trans. Frank H. Knight (New York, NY: Collier Books, 1961) 208-209</ref> Double book entry accounting is a method by which every economic action must affect two accounts so that they balance in the equation:<blockquote>'''[[Asset|Assets]] - [[Liability|Liabilities]] = [[Equity]]'''</blockquote>
== Recent Developments ==

Modern day capital accounting in the [[United States]] is under the standard Generally Accepted Accounting Principles ([[GAAP]]). The Securities and Exchange Commission ([[SEC]]) has proposed a movement to international financial reporting standards or [[IFRS]].

[[Economic calculation]] directs the actions of individual business persons. "Economic logic prevails over the technological," says Schumpeter.<ref name="schumpeter_economic_logic">[[Joseph Schumpeter]], ''The Theory of Economic Development'', trans. Redvers Opie (Cambridge, Massachusetts: Harvard University Press, 1961) 14</ref> The transition to a world standard of accounting may impart some benefits, for example: "...in more efficient functioning of [[capital markets]] and a lower [[cost of capital]] for the economy as a whole." <ref name="SFAC_8">Statement of Financial Accounting Concepts, No. 8 [http://www.fasb.org/cs/BlobServer?blobcol=urldata&blobtable=MungoBlobs&blobkey=id&blobwhere=1175821997186&blobheader=application/pdf] QC37</ref> In sum, the method of economic calculation has importance in economic analysis.

==Specific concepts==
===Cost accounting===
Cost accounting is a central element of managerial accounting.

===Grenzplankostenrechnung (GPK)===
{{main|Grenzplankostenrechnung (GPK)}}

Grenzplankostenrechnung is a German costing methodology, developed in the late 1940s and 1950s, designed to provide a consistent and accurate application of how managerial costs are calculated and assigned to a product or service. The term Grenzplankostenrechnung, often referred to as GPK, has best been translated as either ''Marginal Planned Cost Accounting''<ref>{{cite journal|last=Friedl|first=Gunther|coauthors=Hans-Ulrich Kupper and Burkhard Pedell|title=Relevance Added: Combining ABC with German Cost Accounting|journal=Strategic Finance|issue=June|pages=56–61|year=2005}}</ref> or ''Flexible Analytic Cost Planning and Accounting''.<ref>{{cite journal|last=Sharman|first=Paul A.|title=Bring On German Cost Accounting|journal=Strategic Finance|issue=December|pages=2–9|year=2003}}</ref>

The origins of GPK are credited to Hans Georg Plaut, an automotive engineer and Wolfgang Kilger, an academic, working towards the mutual goal of identifying and delivering a sustained methodology designed to correct and enhance cost accounting information. GPK is published in cost accounting textbooks, notably ''Flexible Plankostenrechnung und Deckungsbeitragsrechnung''<ref>{{cite book|last=Kilger|first=Wolfgang|others=Updated by Kurt Vikas and Jochen Pampel|title=Flexible Plankostenrechnung und Deckungsbeitragsrechnung|edition=12th|publisher=Gabler GmbH|location=Wiesbaden,Germany|year=2002}}</ref> and taught at German-speaking universities today.

===Lean accounting (accounting for lean enterprise)===
{{main|Lean accounting}}
In the mid- to late-1990s several books were written about accounting in the lean enterprise (companies implementing elements of the [[Toyota Production System]]). The term lean accounting was coined during that period. These books contest that traditional accounting methods are better suited for mass production and do not support or measure good business practices in just-in-time manufacturing and services. The movement reached a tipping point during the 2005 Lean Accounting Summit in Dearborn, MI. 320 individuals attended and discussed the merits of a new approach to accounting in the lean enterprise. 520 individuals attended the 2nd annual conference in 2006.

===Resource consumption accounting (RCA)===
{{main|Resource Consumption Accounting}}
Resource Consumption Accounting (RCA) is formally defined as a dynamic, fully integrated, principle-based, and comprehensive management accounting approach that provides managers with decision support information for enterprise optimization. RCA emerged as a management accounting approach around 2000 and was subsequently developed at [http://www.CAM-I.org CAM-I] the Consortium for Advanced Manufacturing–International, in a [http://www.cam-i.org/displaycommon.cfm?an=1&subarticlenbr=30 Cost Management Section ''RCA interest group''] in December 2001.

===Throughput accounting===
{{main|Throughput accounting}}
The most significant recent direction in managerial accounting is throughput accounting; which recognizes the interdependencies of modern production processes. For any given product, customer or supplier, it is a tool to measure the contribution per unit of constrained resource.

===Transfer pricing===
{{main|Transfer pricing}}
Management accounting is an applied discipline used in various industries. The specific functions and principles followed can vary based on the industry. Management accounting principles in banking are specialized but do have some common fundamental concepts used whether the industry is manufacturing based or service oriented. For example, transfer pricing is a concept used in manufacturing but is also applied in banking. It is a fundamental principle used in assigning value and revenue attribution to the various business units. Essentially, transfer pricing in banking is the method of assigning the interest rate risk of the bank to the various funding sources and uses of the enterprise. Thus, the bank's corporate treasury department will assign funding charges to the business units for their use of the bank's resources when they make loans to clients. The treasury department will also assign funding credit to business units who bring in deposits (resources) to the bank. Although the funds transfer pricing process is primarily applicable to the loans and deposits of the various banking units, this proactive is applied to all assets and liabilities of the business segment. Once transfer pricing is applied and any other management accounting entries or adjustments are posted to the ledger (which are usually memo accounts and are not included in the legal entity results), the business units are able to produce segment financial results which are used by both internal and external users to evaluate performance.


==Resources and continuous learning==
There are a variety of ways to keep current and continue to build one's knowledge base in the field of management accounting. Certified Management Accountants (CMAs) are required to achieve continuing education hours every year, similar to a Certified Public Accountant. A company may also have research and training materials available for use in a corporate owned library. This is more common in "[[Fortune 500]]" companies who have the resources to fund this type of training medium.

There are also numerous journals, on-line articles and blogs available. The journal ''Cost Management'' ({{ISSN|1092-8057}})<ref>{{cite web|url=http://ria.thomsonreuters.com/estore/printdetail.aspx?ID=ZMCMP |title=Cost Management |publisher=Thomson Reuters |date=2011 |accessdate=November 12, 2011}}</ref> and the [http://www.imanet.org/publications_maq.asp Institute of Management Accounting] (IMA) site are sources which includes [[Management Accounting Quarterly]] and ''Strategic Finance'' publications. Indeed, management accounting is needed in an organization.

==References==
{{Reflist}}

===Related qualifications===
There are several related professional qualifications and certifications in the field of accountancy including:
* Management Accountancy Qualifications
** [[Chartered Institute of Management Accountants|CIMA]]
** [[Institute of Certified Management Accountants|ICMA]]
** [[Certified Management Accountant|CMA]]
* Other Professional Accountancy Qualifications
** [[Chartered Institute of Public Finance and Accountancy]], CIPFA
** [[Chartered Certified Accountant]], ([[Association of Chartered Certified Accountants|ACCA]])
** [[Chartered Accountant]], ([[Chartered accountant|CA]])
** [[Certified Public Accountant]], ([[Certified Public Accountant|CPA]])
*** [[American Institute of Certified Public Accountants]]
** [[CPA Australia|Certified Practicing Accountant]] (CPA Australia)
** [[Chartered Global Management Accountant]]

{{Stub}}
[[Category:Economic concepts]]

International Financial Reporting Standards

2011-12-30T11:11:28Z

Geofferycheung: /* External links */

'''International Financial Reporting Standards''' ('''IFRS''') are principles-based standards, interpretations and the framework (1989)[http://www.iasb.org/IFRSs/IFRs.htm Full texts]</ref> adopted by the [[International Accounting Standards Board]] (IASB).

Many of the standards forming part of IFRS are known by the older name of '''International Accounting Standards''' (IAS). IAS were issued between 1973 and 2001 by the Board of the [[International Accounting Standards Committee]] (IASC). On April 1, 2001, the new IASB took over from the IASC the responsibility for setting International Accounting Standards. During its first meeting the new Board adopted existing IAS and Standing Interpretations Committee standards (SICs). The IASB has continued to develop standards calling the new standards IFRS.

==Structure of IFRS==
IFRS are considered a "principles based" set of standards in that they establish broad rules as well as dictating specific treatments.

International Financial Reporting Standards comprise:

* ''International Financial Reporting Standards (IFRS)''—standards issued after 2001
* ''International Accounting Standards (IAS)''—standards issued before 2001

* ''Standing Interpretations Committee (SIC)''—issued before 2001
* '' Conceptual Framework for the Preparation and Presentation of Financial Statements (2010)''

IAS 8 Par. 11additional paragraph has to add

''"In making the judgement described in paragraph 10, management shall refer to, and consider the applicability of, the following sources in descending order:''

''(a) the requirements and guidance in Standards and Interpretations dealing with similar and related issues; and''

''(b) the definitions, recognition criteria and measurement concepts for assets, liabilities, income and expenses in the '''Framework'''."''

==Framework==

The [http://www.aasb.com.au/admin/file/content105/c9/Framework_07-04nd.pdf Framework for the Preparation and Presentation of Financial Statements] states basic principles for IFRS.

The IASB and [[FASB]] Frameworks are in the process of being updated and converged. [http://www.iasb.org/Current+Projects/IASB+Projects/Conceptual+Framework/Conceptual+Framework.htm The Joint Conceptual Framework project] aims to update and refine the existing concepts to reflect the changes in markets, business practices and the economic environment that have occurred in the two or more decades since the concepts were first developed.

==Further reading==

* Original texts of IAS/IFRS, SIC and IFRIC adopted by the Commission of the European Communities and published in Official Journal of the European Union http://ec.europa.eu/internal_market/accounting/ias_en.htm#adopted-commission

* International Accounting Standards Board (2007): ''International Financial Reporting Standards 2007 (including International Accounting Standards (IAS(tm)) and Interpretations as at 1 January 2007)'', LexisNexis, ISBN 1-4224-1813-8

== External links ==

*[http://www.sec.gov/rules/proposed/33-8397.htm U.S. Securities and Exchange Commission] Proposal for First-Time Application of International Financial Reporting Standards by Foreign private issuers registered with the SEC
* [http://www.icaew.com/index.cfm/route/138201/icaew_ga/en/Library/Links/Accounting_standards/Accounting_Standards Accounting Standards]
*[http://www.deloitte.com/view/en_GB/uk/industries/financial-services/sector-focus/capital-markets/2c557501a5b91210VgnVCM200000bb42f00aRCRD.htm International Financial Reporting Standards (IFRS) - Deloitte] - More information in regards to the IFRS for Financial services sector
* [http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/ECAEXT/EXTCENFINREPREF/0,,contentMDK:22577649~pagePK:64168445~piPK:64168309~theSitePK:4152118,00.html IFRS for SMEs] Presented by Michael Wells, Director of the IFRS Education Initiative at the IASC Foundation
* [http://www.pwc.com/tw/h/is/index.jhtml PCW Japan IRSFS Centre]

International Financial Reporting Standards

2011-12-29T15:50:03Z

Geofferycheung: /* External links */

'''International Financial Reporting Standards''' ('''IFRS''') are principles-based standards, interpretations and the framework (1989)[http://www.iasb.org/IFRSs/IFRs.htm Full texts]</ref> adopted by the [[International Accounting Standards Board]] (IASB).

Many of the standards forming part of IFRS are known by the older name of '''International Accounting Standards''' (IAS). IAS were issued between 1973 and 2001 by the Board of the [[International Accounting Standards Committee]] (IASC). On April 1, 2001, the new IASB took over from the IASC the responsibility for setting International Accounting Standards. During its first meeting the new Board adopted existing IAS and Standing Interpretations Committee standards (SICs). The IASB has continued to develop standards calling the new standards IFRS.

==Structure of IFRS==
IFRS are considered a "principles based" set of standards in that they establish broad rules as well as dictating specific treatments.

International Financial Reporting Standards comprise:

* ''International Financial Reporting Standards (IFRS)''—standards issued after 2001
* ''International Accounting Standards (IAS)''—standards issued before 2001

* ''Standing Interpretations Committee (SIC)''—issued before 2001
* '' Conceptual Framework for the Preparation and Presentation of Financial Statements (2010)''

IAS 8 Par. 11additional paragraph has to add

''"In making the judgement described in paragraph 10, management shall refer to, and consider the applicability of, the following sources in descending order:''

''(a) the requirements and guidance in Standards and Interpretations dealing with similar and related issues; and''

''(b) the definitions, recognition criteria and measurement concepts for assets, liabilities, income and expenses in the '''Framework'''."''

==Framework==

The [http://www.aasb.com.au/admin/file/content105/c9/Framework_07-04nd.pdf Framework for the Preparation and Presentation of Financial Statements] states basic principles for IFRS.

The IASB and [[FASB]] Frameworks are in the process of being updated and converged. [http://www.iasb.org/Current+Projects/IASB+Projects/Conceptual+Framework/Conceptual+Framework.htm The Joint Conceptual Framework project] aims to update and refine the existing concepts to reflect the changes in markets, business practices and the economic environment that have occurred in the two or more decades since the concepts were first developed.

==Further reading==

* Original texts of IAS/IFRS, SIC and IFRIC adopted by the Commission of the European Communities and published in Official Journal of the European Union http://ec.europa.eu/internal_market/accounting/ias_en.htm#adopted-commission

* International Accounting Standards Board (2007): ''International Financial Reporting Standards 2007 (including International Accounting Standards (IAS(tm)) and Interpretations as at 1 January 2007)'', LexisNexis, ISBN 1-4224-1813-8

== External links ==

*[http://www.sec.gov/rules/proposed/33-8397.htm U.S. Securities and Exchange Commission] Proposal for First-Time Application of International Financial Reporting Standards by Foreign private issuers registered with the SEC
* [http://www.icaew.com/index.cfm/route/138201/icaew_ga/en/Library/Links/Accounting_standards/Accounting_Standards Accounting Standards]
*[http://www.deloitte.com/view/en_GB/uk/industries/financial-services/sector-focus/capital-markets/2c557501a5b91210VgnVCM200000bb42f00aRCRD.htm International Financial Reporting Standards (IFRS) - Deloitte]
* [http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/ECAEXT/EXTCENFINREPREF/0,,contentMDK:22577649~pagePK:64168445~piPK:64168309~theSitePK:4152118,00.html IFRS for SMEs] Presented by Michael Wells, Director of the IFRS Education Initiative at the IASC Foundation
* [http://www.pwc.com/tw/h/is/index.jhtml PCW Japan IRSFS Centre]

International Financial Reporting Standards

2011-12-29T15:48:54Z

Geofferycheung:

'''International Financial Reporting Standards''' ('''IFRS''') are principles-based standards, interpretations and the framework (1989)[http://www.iasb.org/IFRSs/IFRs.htm Full texts]</ref> adopted by the [[International Accounting Standards Board]] (IASB).

Many of the standards forming part of IFRS are known by the older name of '''International Accounting Standards''' (IAS). IAS were issued between 1973 and 2001 by the Board of the [[International Accounting Standards Committee]] (IASC). On April 1, 2001, the new IASB took over from the IASC the responsibility for setting International Accounting Standards. During its first meeting the new Board adopted existing IAS and Standing Interpretations Committee standards (SICs). The IASB has continued to develop standards calling the new standards IFRS.

==Structure of IFRS==
IFRS are considered a "principles based" set of standards in that they establish broad rules as well as dictating specific treatments.

International Financial Reporting Standards comprise:

* ''International Financial Reporting Standards (IFRS)''—standards issued after 2001
* ''International Accounting Standards (IAS)''—standards issued before 2001

* ''Standing Interpretations Committee (SIC)''—issued before 2001
* '' Conceptual Framework for the Preparation and Presentation of Financial Statements (2010)''

IAS 8 Par. 11additional paragraph has to add

''"In making the judgement described in paragraph 10, management shall refer to, and consider the applicability of, the following sources in descending order:''

''(a) the requirements and guidance in Standards and Interpretations dealing with similar and related issues; and''

''(b) the definitions, recognition criteria and measurement concepts for assets, liabilities, income and expenses in the '''Framework'''."''

==Framework==

The [http://www.aasb.com.au/admin/file/content105/c9/Framework_07-04nd.pdf Framework for the Preparation and Presentation of Financial Statements] states basic principles for IFRS.

The IASB and [[FASB]] Frameworks are in the process of being updated and converged. [http://www.iasb.org/Current+Projects/IASB+Projects/Conceptual+Framework/Conceptual+Framework.htm The Joint Conceptual Framework project] aims to update and refine the existing concepts to reflect the changes in markets, business practices and the economic environment that have occurred in the two or more decades since the concepts were first developed.

==Further reading==

* Original texts of IAS/IFRS, SIC and IFRIC adopted by the Commission of the European Communities and published in Official Journal of the European Union http://ec.europa.eu/internal_market/accounting/ias_en.htm#adopted-commission

* International Accounting Standards Board (2007): ''International Financial Reporting Standards 2007 (including International Accounting Standards (IAS(tm)) and Interpretations as at 1 January 2007)'', LexisNexis, ISBN 1-4224-1813-8

== External links ==

*[http://www.sec.gov/rules/proposed/33-8397.htm U.S. Securities and Exchange Commission] Proposal for First-Time Application of International Financial Reporting Standards by Foreign private issuers registered with the SEC
* [http://www.icaew.com/index.cfm/route/138201/icaew_ga/en/Library/Links/Accounting_standards/Accounting_Standards Accounting Standards]
*[http://www.deloitte.com/view/en_GB/uk/industries/financial-services/sector-focus/capital-markets/2c557501a5b91210VgnVCM200000bb42f00aRCRD.htm International Financial Reporting Standards (IFRS) - Deloitte]
* [http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/ECAEXT/EXTCENFINREPREF/0,,contentMDK:22577649~pagePK:64168445~piPK:64168309~theSitePK:4152118,00.html IFRS for SMEs] Presented by Michael Wells, Director of the IFRS Education Initiative at the IASC Foundation
* [http://www.pwc.com/tw/zh/ifrs/index.jhtml PCW Japan IRSFS Centre]

International Financial Reporting Standards

2011-12-29T15:48:03Z

Geofferycheung: Created page with "'''International Financial Reporting Standards''' ('''IFRS''') are principles-based standards, interpretations and the framework (1989)<ref>[http://www.iasb.org/IFRSs/IFRs.htm Fu..."

'''International Financial Reporting Standards''' ('''IFRS''') are principles-based standards, interpretations and the framework (1989)<ref>[http://www.iasb.org/IFRSs/IFRs.htm Full texts]</ref> adopted by the [[International Accounting Standards Board]] (IASB).

Many of the standards forming part of IFRS are known by the older name of '''International Accounting Standards''' (IAS). IAS were issued between 1973 and 2001 by the Board of the [[International Accounting Standards Committee]] (IASC). On April 1, 2001, the new IASB took over from the IASC the responsibility for setting International Accounting Standards. During its first meeting the new Board adopted existing IAS and Standing Interpretations Committee standards (SICs). The IASB has continued to develop standards calling the new standards IFRS.

==Structure of IFRS==
IFRS are considered a "principles based" set of standards in that they establish broad rules as well as dictating specific treatments.

International Financial Reporting Standards comprise:

* ''International Financial Reporting Standards (IFRS)''—standards issued after 2001
* ''International Accounting Standards (IAS)''—standards issued before 2001

* ''Standing Interpretations Committee (SIC)''—issued before 2001
* '' Conceptual Framework for the Preparation and Presentation of Financial Statements (2010)''

IAS 8 Par. 11additional paragraph has to add

''"In making the judgement described in paragraph 10, management shall refer to, and consider the applicability of, the following sources in descending order:''

''(a) the requirements and guidance in Standards and Interpretations dealing with similar and related issues; and''

''(b) the definitions, recognition criteria and measurement concepts for assets, liabilities, income and expenses in the '''Framework'''."''

==Framework==

The [http://www.aasb.com.au/admin/file/content105/c9/Framework_07-04nd.pdf Framework for the Preparation and Presentation of Financial Statements] states basic principles for IFRS.

The IASB and [[FASB]] Frameworks are in the process of being updated and converged. [http://www.iasb.org/Current+Projects/IASB+Projects/Conceptual+Framework/Conceptual+Framework.htm The Joint Conceptual Framework project] aims to update and refine the existing concepts to reflect the changes in markets, business practices and the economic environment that have occurred in the two or more decades since the concepts were first developed.

==Further reading==

* Original texts of IAS/IFRS, SIC and IFRIC adopted by the Commission of the European Communities and published in Official Journal of the European Union http://ec.europa.eu/internal_market/accounting/ias_en.htm#adopted-commission

* International Accounting Standards Board (2007): ''International Financial Reporting Standards 2007 (including International Accounting Standards (IAS(tm)) and Interpretations as at 1 January 2007)'', LexisNexis, ISBN 1-4224-1813-8

== External links ==

*[http://www.sec.gov/rules/proposed/33-8397.htm U.S. Securities and Exchange Commission] Proposal for First-Time Application of International Financial Reporting Standards by Foreign private issuers registered with the SEC
* [http://www.icaew.com/index.cfm/route/138201/icaew_ga/en/Library/Links/Accounting_standards/Accounting_Standards Accounting Standards]
*[http://www.deloitte.com/view/en_GB/uk/industries/financial-services/sector-focus/capital-markets/2c557501a5b91210VgnVCM200000bb42f00aRCRD.htm International Financial Reporting Standards (IFRS) - Deloitte]
* [http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/ECAEXT/EXTCENFINREPREF/0,,contentMDK:22577649~pagePK:64168445~piPK:64168309~theSitePK:4152118,00.html IFRS for SMEs] Presented by Michael Wells, Director of the IFRS Education Initiative at the IASC Foundation
* [http://www.pwc.com/tw/zh/ifrs/index.jhtml PCW Japan IRSFS Centre]