Business Ethics and Corporate Governance, Second Edition

MANAGEMENT ACCOUNTING

Management accounting is the process of identifying, measuring, analysing, interpreting, and communicating information for the pursuit of an organization’s goals. Management accounting is also known as cost accounting. Management accounting involves budgeting, forecasting and analysing cost behaviour, cost management, financial control and decision making, ratio analysis and so on.

The main characteristics of management accounting are as follows:

• The data involved in the process are meant solely for the use, understanding and analysis of internal users.
• The preparation of reports etc. under this process is not subject to regulations or GAAP standards.
• The relevance and flexibility of data are completely determined by the ...