Question

1. Discuss what you believe is the most important aspect of managerial accounting.

2. Management can develop accounting systems to closely track costs and identify deviations from expected amounts. However, how can managers combat fraud and other ethical dilemmas?   Discuss.

Please briefly detailed answers for each question 400 words at least, and with references if possible, thank you :)

Answer 1

1) Managerial accounting is the practice of identifying, measuring, analyzing, interpreting, and communicating financial information to managers for the pursuit of an organization's goals. For big organisation or any organisation having heavy transactions, management accounting is essential for having a track or control over it's transactions.

2)Management accounting is so important because it acts as a bridge between the finance function and other parts of the business. It helps the management controlling the entity.

Its key tasks, assuring a long time company success, are:

* Pricing
* Budgeting
* Reporting

*Pricing:

The major source of any business is sales income or receipt of fees in which fixing of price is important because over pricing and lower pricing will lead to business failure.

Managerial accounting here helps in identifying cost more accurately which ultimately helps in reducing price and have a steady growth in competitive market.

* Budgeting:

Budgeting helps in forecasting future needs and risk . Having a control over accounting leads for more accurately predicting the future.

* Reporting:

Managerial accounting and internal audit helps to get better control over the transactions of the business and report the high officials and management about the current status of the business.