Management Accounting and Financial Reporting Overview

Management Accounting

Management accounting measures, analyzes, and reports financial and non-financial information that helps managers make decisions to fulfill organizational goals. Management accounting need not be GAAP compliant. Managers use management accounting information to develop, communicate, and implement strategies, coordinate product design, production, and marketing decisions, and evaluate a company's performance. Behavioral and technical considerations recognize that management is primarily a human activity that should focus on encouraging individuals to do their jobs better.

Financial Accounting

Financial accounting focuses on reporting to external parties such as investors, government agencies, and banks. It measures and records business transactions and provides financial statements that are based on generally accepted accounting principles (GAAP).

Cost Accounting

Cost accounting measures, analyzes, and reports financial and non-financial information related to the costs of acquiring or using resources in an organization.

Strategy and Value Chain

Strategy specifies how an organization matches its own capabilities with the opportunities in the marketplace. The value chain is the sequence of business functions by which a product is made progressively more useful to customers, including research and development, design, production, marketing, distribution, and customer service.

Supply Chain and Decision Making

The supply chain describes the flow of goods, services, and information from the initial sources of materials and services to the delivery of products to consumers. The decision-making process involves identifying the problem/uncertainties, obtaining information, making predictions about the future, choosing among alternatives, implementing the decision, evaluating performance, and learning.