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Accounting, 3rd Edition by Michael J. Jones

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Chapter 20

Strategic management accounting

‘Today's management accounting information, driven by the procedures and cycle of the organisation's financial reporting system, is too late, too aggregated, and too distorted to be relevant for managers’ planning and control decisions.’

H.T. Johnson and R.S. Kaplan (1987), Relevance Lost: The Rise and Fall of Management Accounting, p. 1.

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Learning Outcomes

After completing this chapter you should be able to:

  • Explain the nature and importance of strategic management accounting.
  • Understand and explain techniques used to assess the current position of the business.
  • Appreciate the techniques of SWOT analysis, balanced scorecard and benchmarking.
  • Discuss the strategic choices facing companies.

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Chapter Summary

  • Strategic management accounting is externally orientated and concerns a business's future long-term strategy.
  • Strategic management accounting is a relatively new topic.
  • The three stages of strategic management accounting are

      (i) assessment of the current position of the business,

     (ii) appraisal of the current position of the business, and

    (iii) strategic choice of future direction of the business.

  • The assessment of the current position of ...

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