McGraw-Hill/Irwin © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved .

Chapter 1

The Changing Role of

Managerial Accounting in
a Dynamic Business Environment

McGraw-Hill/Irwin © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved .

 1-3

Define Managerial Accounting

 1-4

List & Explain the Four Management

Processes

1. Decision Making

2. Planning

3. Directing
Operational
Activities

4. Controlling
 1-5

List & Describe Five Objectives of

Managerial Accounting

1. Provide Information for Decision Making &

Planning
2. Assist in Directing & Controlling
3. Motivate Towards Goals
4. Measure Performance
5. Access Competitive Position
 1-6

Definitions Match

Attention- Encouraging & authorizing

Directing employees to initiate
Function improvements

A model business performance

evaluation measures
Empowerment

Directs managers’ focus to

Balanced issues that need their attention
Scorecard
 1-7

List the Four Perspectives of the

Balanced Scorecard
Financial
Goals Measures

Customer Internal Operations

Goals Measures Goals Measures

Innovation & Learning

Goals Measures
 1-8

Definitions Match

Managerial Accumulates managerial &

Accounting financial accounting data

Focuses on the internal needs

Financial
of the organization
Accounting

Accounting information for

Cost reporting to outside parties
Accounting
 1-9

Definitions Match

Line Top financial accountant in an

Position organization

Managers indirectly involved in

operations
Staff
Position
Managers directly involved in
providing goods & services or
in operating the facilities
CFO
 1-10

Discuss Major Themes in Managerial

Accounting
 Information & Incentives
 Behavioral Issues
 Costs & Benefits
 Evolution
& Adaptation in Managerial
Accounting
 E-Business

 Service versus Manufacturing Firms

 1-11

Continue Discussing Major Themes in

Managerial Accounting
 Emergence of New Industries
 Global Competition
 Focus on the Customer
 Cross-Functional Teams
 Computer-Integrated Manufacturing
 Product Life Cycles & Diversity
 1-12

Continue Discussing Major Themes in

Managerial Accounting
 Time-Based Competition
 Information & Communication
Technology
 Just-in-Time Inventory Management
 Total Quality Management
 Continuous Improvement
 1-13

Definitions Match
Non-Value- Emphasis on organizations
Added activities

Activity Activities that can be

Accounting eliminated that do not effect
product value
Activity-Based
Using ABC to improve the
Costing (ABC)
business
Activity-Based System for determining
Management product or service costs
 1-14

Comment on Strategic Cost

Management & the Value Chain
 Linked Value Creating Activities

 Understanding the Value Chain

 Best Meeting the Goals

 Cost Drivers

 Theory of Constraints
 1-15

Review Managerial Accounting as A

Career
 Professional Organizations
 IMA – Institute of Management Accountants
 Society of Management Accountants of
Canada
 Institute
of Chartered Management
Accountants – Great Britain
 Institute of Chartered Accountants - Australia
 1-16

Discuss Professional Certification

 Administered by the IMA

 Certified Management Accountant –
CMA
 Certified Financial Manager – CFM
 Administered
by the Society of
Management Accountants of Canada
 Registered Industrial Accountant - RIA
 1-17

Review & Explain the Standards of

Ethical Conduct

 Competence

 Confidentiality

 Integrity

 Objectivity

 Resolution of Ethical
Conflict
 This
Completes
Chapter 1

McGraw-Hill/Irwin © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved .