Advantages of management accounting

Advantages of management accounting

1. Advantages of management accounting PRESENTED BY Submitted to SUBHASREE.R ( Roll no. 39) Pawan Kumar Gupta , CHANDHANA ( Roll no. 15) Assistant Professor, Department of B.COM –II YEAR Commerce , MGGAC, Mahe

2. INTRODUCTION Roles of Management accounting Management accounting is about providing necessary financial and non-financial information to management and employees at all level inside the organization for decision making purpose , so that they can better be able to make following rational decisions in timely manner > control and prepare management accounts which captures and processes data for organization. > formulating overall strategies and long range/ short range planning > Making resource allocating decisions > Planning and control of operating activities > Evaluating of manager and operation > Reporting information for use in external reports ( annual accounts)

3. 1 st : Increase Efficiency : Management accounting increases the efficiency of operation of company. Everything is done in management accounting with a scientific system for evaluating and comparing the performance. With this, we find deviations. We will take promotional decisions on this basis. Other employees will also be motivated with this because if their performance will be favorable, they get reward of this. Thus management accounting increases efficiency.

4. : Using of management accounting's budgetary control and capital budgeting tool, company can easily succeed to reduce both operating and capital expenditures. After this, company can reduce its price and then company will receive super profits. 2 nd :MAXIMIZING THE PROFITABILITY :

5. 3 rd :Simplify the Financial Statements For taking different managerial decisions, management accountant provides deep technical reports with simple interpretations in which he mentions the facts of financial statements, after this, company’s management officers understand what is in financial statement and how will they use this for company’s progress.

6. 4 th : Control of Business’s Cash Flow :It is one of important advantage of management accounting that it can be used for controlling of business’s cash flow. We all know that cash in hand is better than in fixed properties if there is emergency to pay our loan or debt. So, management accountant deeply studies from where is money coming and where is it going. To check on misuse of money will surely control of business’s cash flow.

7. 5 th : Business-critical Decisions To take business – critical decisions, now management accounting will become more powerful. Global management accountants are coming for join on one plate-form for taking all business critical decisions

8. Conclusion Management accounting is needed in business because it has capacity to change the business performance and financial position. Management has many tools it can use to be productive and sustain a successful operation. Managerial accounting is important in the business and should be valued . The role it plays in business is one that guides the plans to make sure the business stays on course

9. Management accounting is those areas of accounting concerned with financial planning, principally through the interpretation and use of financial data for important management of the business

10. Thank you