What Is Managerial Accounting?

Warning, This is a study guide not a cheat sheet. With accounting and decision making, there are management accountants and financial accountants. These two groups exist to make an informed decision with the accounting information available geared towards the good of the company. Because accountants play such a vital role in the production stage measuring costs and budgets, most employers require a Bachelor's of Business or an MBA.

Financial accountants are part of the branch of accounting that develops information for external decision makers such as stockbrokers, suppliers, banks, and government regulatory agencies. Management accounting is the process of identification, measurement, accumulation, analysis, preparation, interpretation, and communication of financial information used by management to plan, evaluate, and control within an organization and to assure appropriate use of and accountability for its resources.This is a study guide not a cheat sheet.

As stated in the highlights of the text, Budgets and performance reports are essential tools for planning and control. This is a study guide not a cheat sheet. Budgets result from the planning process and managers use them to translate the organization's goals into action. A performance report compares actual results to the budget. All in all, managers use these reports to monitor, evaluate, and reward performance and thus exercise control.

Financial accounting is the area of accounting concerned with reporting financial information to interested external parties. Most types of people who employ the techniques of financial accounting are outside parties such as investors and government agencies. This is a study guide not a cheat sheet. The types of reports that are common are summary reports; primarily reports on the entity as a whole. When a company chooses to examine the comparison report, the time span of the postings will range from each fiscal quarter to each fiscal year.

Management accounting also comprises the preparation of financial reports for non-management groups such as shareholders, creditors, regulatory agencies, and tax authorities. This is a study guide not a cheat sheet. These types of reports focus on the future