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All rights reserved.,,The Accountant’s Role,in the Organization,,CHAPTER 1,LEARNING OBJECTIVES,Describe how cost accounting supports management accounting and financial accounting,Understand how management accountants affect strategic decisions,Describe the set of business functions in the value chain and Identify the dimensions of performance that customers are expecting of companies,Explain the five-step decision making process and its role in management accounting,Describe three guidelines management accountants follow in supporting managers,Understand how management accounting fits into an organization’s structure,Understand what professional ethics means to management accountants,,LEARNING OBJECTIVE 1,,Describe how cost accounting supports management accounting and financial accounting,,Accounting Discipline Overview,Managerial Accounting – measures, analyzes and reports financial and nonfinancial information to help managers make decisions to fulfill organizational goals. Managerial accounting need not be GAAP compliant.,,Financial Accounting – focus on reporting to external users including investors, creditors, and governmental agencies. Financial statements must be based on GAAP.,,Financial and Managerial Accounting,Financial Accounting,–,focus on external users and GAAP rules P4,Managerial Accounting,–,focus on internal users and is not necessarily GAAP-driven. Also provides data for financial accounting. This includes:,Cost Accounting,Cost Management,Cost Accounting,Provides,information for both management accounting and financial accounting.,It,measures,and,reports,financial and non-financial data that relates to the cost of a,c,quiring or con,s,uming resources by an organisation.,,Cost management,The approaches and activities of managers to use resources to increase value to customers and to achieve organizational goals,Amounts and kinds of material used,Changes in plant processes,Changes in product designs,…….,Linked with revenue and profits,Cost management,≠,continuous reduction in costs,Major Differences Between Financial & Managerial Accounting,,Managerial Accounting,Financial Accounting,Purpose,Decision making,Communicate financial position to outsiders,Primary Users,Internal managers,External users,Focus/Emphasis,Future-oriented,Past-oriented,Rules,Do not have to follow GAAP; cost vs. benefit,GAAP compliant;,CPA audited,Time Span,Ultra current to very long,time horizons,Historical monthly, quarterly reports,Behavioral Issues,Designed to influence employee behavior,Indirect effects on,employee behavior,,LEARNING OBJECTIVE 2,,Understand how management accountants affect strategic decisions,,Strategy and Management Accounting,Strategy – specifies how an organization,matches,its own,capabilities,with the,opportunities,in the marketplace to accomplish its objectives P5,Generic Strategies,There are three generic (primary) strategies:,,Differentiation,,Focus (niche marketing),,Cost leadership,Strategy and Management Accounting , conts.,Management accounting helps answer important questions such as:,Who are our most important customers, and how do we deliver value to them?,What substitute products exist in the marketplace, and how do they differ from our own?,What is our critical capability?,Will we have enough cash to support our strategy or will we need to seek additional sources?,,,Strategy and Management Accounting , conts.,Strategic Cost Management – focuses specifically on the cost dimension within a firm’s overall strategy,,Strategy and Management Accounting , conts.,Can’t be all things to all people. Be best at doing a few things.,,Then expand on those core competencies.,,Apple,Google,细分市场（先锋石油）,,马路型,16%,收入较高的男性，他们每年驾驶,2.5,万到,5,万英里,,,用信用卡购买高级汽油,,,在便利店购买三明治和饮料,中心型,16%,中高收入男女,,,他们喜欢一个品牌,,,有时认定一个加油站,,,经常购买高级汽油,,,用现金支付,Ｆ,3,型,27%,拥有,F3,特质,,FUEL\FOOD\FAST,,力争上游的男女,,,年龄一般不到,25,岁,,,行色匆匆,,,购买汽油时喜欢购买大量零食,居家型,21%,家庭主妇,,,接送孩子上学,价格型,20%,只购买便宜的汽油,,,对加油站和品牌没有偏好,,LEARNING OBJECTIVE 3,,Describe the set of business functions in the value chain and Identify the dimensions of performance that customers are expecting of companies,,,Management Accounting and Value,Creating value,is an important part of planning and implementing strategy P6,Value,is the usefulness a customer gains from a company’s product or service,Value Chain,is the sequence of business functions in which customer usefulness is added to products or services,The Value-Chain consists of:,Research & Development,Design,Production,Marketing,Distribution,Customer Service,© 2009 Pearson Prentice Hall. All rights reserved.,Management Accounting and Value, conts.,The Value Chain Illustrated,Management Accounting and Value, conts.,The Value Chain:P6,Research and Development,involves generating and experimenting with new ideas related to new products, services, or processes.,The,,Design,,function undertakes detailed planning and engineering of products, services, or processes.,Management Accounting and Value , conts.,The Value Chain:P6,Productio,n,is acquiring, coordinating, and assembling resources to produce a product or deliver a service.,Marketing,,involves promoting and selling products or services to customers.,Distribution,,is the process of delivering the products or services to customers.,Customer Service,,provides after-sale support to customers.,Reduce costs in each category,,Improve efficiency,,Help managers make cost-benefit tradeoffs,Management Accounting and Value , conts.,VC,重构,,,Value Chain Components,,R&D,Design,Production,Marketing,Distribution,Service,,,,Supplier,Value,Chain,,,,Firm Z,Value,Chain,,,,Distribution,Value,Chain,,,,Buyer,Value,Chain,,,,Disposal,Value,Chain,End-Use Consumer Pays for Profit Margins Throughout the Value Chain,Primary,Activities,Support,Activities,Service,Service,Service,Service,A Supply Chain Implementation,Key Success Factors,The dimensions of performance that customers expect, and that are key to the success of a company include:P7,Cost and efficiency,,—,Determine what customers are willing to pay for a product or service and set a “target price.” By subtracting the desired profit, the company can then work to accomplish it “target cost.”,Quality,—,Customers expect high levels of quality. Total Quality Management (TQM) is a philosophy that seeks to improve operations throughout the company and exceed customer expectations.,2024/9/30,28,Key Success Factors, conts.,Time,—,New product development time,and,customer response time,are two elements of this factor. In today,’,s time-conscious society, the customer wants the product or service now. Any delay is unacceptable. A company that can compete on the basis of time, whether in development or delivery is one that has an edge in today,’,s market.,Innovation,—,A constant flow of new products or services is the basis for ongoing company success.,,LEARNING OBJECTIVE 4,,Explain the five-step decision making process and its role in management accounting,,,,,,,F,ive-,S,tep,D,ecision,P,rocess,,F,ive-,S,tep,D,ecision,P,rocess,, conts.,Identify the problems and uncertainties,. What are the choices that are being faced and where do the uncertainties lie?,Obtain information.,Gather information before making a decision helps the manager to make a more informed decision.,Make predictions about the future.,On the basis of the information obtained attempt to predict the outcome of each course of action.,F,ive-,S,tep,D,ecision,P,rocess,, conts.,Make decisions by choosing among alternatives.,The information has been gathered, and projections made. Select an alternative.,A,budget,has been described as the quantitative expression of a proposed plan of action. It is a planning tool.,Control,is the action taken to implement the planning decisions represented by the budget.,F,ive-,S,tep,D,ecision,P,rocess,, conts.,Implement the decision, evaluate performance, and learn.,All the effort expended in steps 1-4 is useless unless the decision is put into action.,Once implemented, the decision must be,monitore,d. This is performance evaluation. One way of doing this is by comparing the budget with the actual results. This makes budgeting a control tool in addition to a planning tool. Often this is accomplished by the use of a performance report.,Learn,. If the results were not as planned, find out why. Use this information to improve the decision-making process for future decisions.,Planning and Control Systems,Collectively the four preceding steps are known as,planning,Planning,：,selects goals, predicts results, decides how to attain goals, and communicates this to the organization,Budget – the most important planning tool,Control,：,takes actions that implement the planning decision, decides how to evaluate performance, and provides feedback to the organization,,LEARNING OBJECTIVE 5,,Describe three guidelines management accountants follow in supporting managers,,Management Accounting Roles,Problem Solver,,Scorekeeper,,Attention Director,Management Accounting Guidelines,Cost-benefit approach,.,Always ask if the benefits from undertaking the activity exceed the costs of doing so. P12,Behavioral considerations,.,Consider the motivational aspect of the decision.,Will the managers and employees be motivated to work toward the goals of the organization?,Technical considerations,.,This provides managers with appropriate information at appropriate intervals to assist in decision making.,Management Accounting Guidelines , conts.,Different costs for different purposes,.,Much of this book is about alternative ways to compute costs.,In determining the cost, the first question that should be asked is “What is the purpose of this cost number?”,Performance evaluation, external reporting, internal decision making are three different purposes that might require a different view of cost.,成本对象,举例,成本种类,产品,洗衣机,产品成本,劳务,洗衣服务,劳务成本,作业,检验产品质量,作业成本,质量,废品,质量成本,工作计划,部门发展计划,计划成本,Different costs for different purposes,,LEARNING OBJECTIVE 6,,Understand how management accounting fits into an organization’s structure,,,Organizational Structure and the Management Accountant,Most organizations distinguish between,line,,and,staff,,relationships. P13,Line management,is directly responsible for attaining the goals of the organization. Production is a line function.,Staff management,supports line management with advice and assistance.,Accounting and human resources are two examples of staff management functions.,Line and Staff Relationships,Line positions,are directly related to achievement of the basic objectives of an organization.,Example: Production supervisors in a manufacturing plant.,Staff positions,provide advice and assistance to line management,Example: Cost accountants in the manufacturing plant.,P14,Organizational Structure and the Management Accountant, conts.,The,Chief Financial Officer,,or,CFO,(also called the finance director) is the executive responsible for overseeing the financial operations of an organization. Included among the responsibilities of the CFO are several functions:,Controller,provides financial information to managers and shareholders and oversees the overall operations of the accounting system.,Organizational Structure and the Management Accountant , conts.,The,Treasury,function includes banking, financing, investments, and cash management.,Risk Management,includes managing the financial risk of interest rate and exchange rate changes as well as derivatives management.,Taxation,includes income taxes, sales taxes, and international tax planning.,Organizational Structure and the Management Accountant, conts.,Investor Relations,responds to and interacts with shareholders.,The scope and importance of,Internal Audit,has increased in recent years and now includes reviewing and analyzing financial and other records to attest to the integrity of the organization’s financial reports and adherence to policies and procedures.,,LEARNING OBJECTIVE 7,,Understand what professional ethics means to management accountants,,,Abandoning ethical standards in business would lead to a lower quality of life with less desirable goods and services at higher prices.,Why Have Ethical Standards?,,Without ethical standards in business, the economy, and all of us who depend on it for jobs, goods, and services, would suffer.,Ethical standards in business are essential for a smooth functioning advanced market economy.,Professional Ethics,Accountants have a special obligation regarding ethics, as they are responsible for the integrity of the financial information provided to external and internal users.,Sarbanes-Oxley focuses on improving internal control, corporate governance, monitoring of managers, and disclosure practices of public corporations.,This legislation brought an increase in the ethical standards of managers and accountants.,The Sarbanes-Oxley Act of 2002,The Sarbanes-Oxley Act of 2002 was intended to protect the interests of those who invest in publicly traded companies by improving the reliability and accuracy of corporate financial reports and disclosures. Six key aspects of the legislation include:,,The Act requires both the CEO and CFO to certify in writing that their company’s financial statements and disclosures fairly represent the results of operations.,,The Act establishes the Public Company Accounting Oversight Board to provide additional oversight of the audit profession.,,The Act places the power to hire, compensate and terminate public accounting firms in the hands of the audit committee.,,The Act places restrictions on audit firms, such as prohibiting public accounting firms from providing a variety of non-audit services to an audit client.,The Sarbanes-Oxley Act of 2002,,The Act requires that a company’s annual report contain an internal control report that is accompanied by an opinion from the company’s audit firm about the fairness of that report.,The Act establishes severe penalties for certain behaviors, such as:,Up to 20 years in prison for altering or destroying any documents that may eventually be used in an official proceeding.,Up to 10 years in prison for retaliating against a “whistle blower.”,Professional Ethics , conts.,The,Institute of Management Accountants (IMA),is the largest association of in management accountants in the United States.,The IMA offers professional certification in the form of the,,CMA,designation —,Certified Management Accountant,.,,This certification represents a demonstration of technical competency in financial and managerial accounting and holds the CMA to high ethical standards.,Professional Ethics, conts.,The IMA,Standards for Ethical Conduct for Practitioners of Management Accounting and Financial Management,presents guidelines on issues relating to,competence, confidentiality, integrity, and credibility,or Objectivity.P14,In addition to the,Standards,,the IMA has an ethics hotline to assist members in resolving their ethical dilemmas.,The four standards of ethical conduct for management accountants as advanced by the Institute of Management Accountants:,Competence,Confidentiality,Integrity,Credibility,or,Objectivity,Professional Ethics,, conts.,55,Competence,Follow applicable laws, regulations and standards.,Maintain professional competence.,Provide accurate, clear, concise, and timely decision support information.,IMA Guidelines for Ethical Behavior,Recognize and communicate professional limitations that preclude responsible judgment.,Confidentiality,Do not disclose confidential information unless legally obligated to do so.,Ensure that subordinates do not disclose confidential information.,Do not use confidential information for unethical or illegal,,advantage.,IMA Guidelines for Ethical Behavior,Mitigate conflicts of interest and advise others of potential conflicts.,Abstain from activities that might discredit the profession.,Refrain from conduct that would prejudice carrying out duties ethically.,Integrity,IMA Guidelines for Ethical Behavior,Communicate information fairly and objectively.,Disclose all relevant information that could influence a user’s understanding of reports and recommendations.,Credibility,IMA Guidelines for Ethical Behavior,Disclose delays or deficiencies in information timeliness, processing, or internal controls.,Typical Ethical Challenges,Case A A management accountant, knowing that reporting a loss for a software division will result in yet another ’rightsizing initiative’ has concerns about the commercial potential of a software product for which development costs are currently being capitalized as an asset rather than being shown as an expense for internal reporting purposes. The division manager argues that showing development costs as an asset is justified because the new product will generate profit. However, the division manager presents little evidence to support his argument. The last two products from this division have been unsuccessful. The management accountant has many friends in the division and wants to avoid a personal confrontation with the division manager.,Typical Ethical Challenges,Case B,A packaging supplier, bidding for a new contract, offers the management accountant of the purchasing company an all-expenses-paid weekend to the Super Bowl. The supplier does not mention the new contract when giving the invitation. The accountant is not a personal friend of the supplier. He knows cost issues are critical in approving the new contract and is concerned that the supplier will ask for details about bids by competing packaging companies.,Typical Ethical Challenges,Case A,Competence, credibility and integrity,Case B,Confidentiality and integrity,Follow employer’s established policies.,For unresolved ethical conflicts:,Discuss the conflict with immediate supervisor or next highest uninvolved manager.,If immediate supervisor is the CEO, consider the board of directors or the audit committee.,Contact with levels above the immediate supervisor should only be initiated with the supervisor’s knowledge, assuming the supervisor is not involved.,IMA Guidelines for Resolution of an Ethical Conflict,Follow employer’s established policies.,For unresolved ethical conflicts:,Except where legally prescribed, maintain confidentiality.,Clarify issues in a confidential discussion with an objective advisor.,Consult an attorney as to legal obligations.,IMA Guidelines for Resolution of an Ethical Conflict,Exercises 1-23,Miller is division controller and Tom Maloney is division manager of the Ramses Shoe Company.,Miller has line responsibility to Tom, but she also has staff responsibility to the company controller.,Tom is under severe pressure to achieve the budgeted division income for the year. He has asked Miller to book $200, 000 of revenues on December 31.,The customers’ orders are firm, but the shoes are still in the production process. They will be shipped on or about January 4. Tom say ,”the key event is getting the sales order, not shipping the shoes. You should support me, not ob,s,truct my reaching di,v,ision goals”,Question:,1.describe Miller’s ethical responsibilities.,2.What should Miller do if Tom gives her a direct order to book the sales?,ANSWER,1. Miller’s ethical responsibilities are well summarized in the IMA’s “Standards of Ethical Conduct for Management Accountants” (Exhibit 1-7 of text). Areas of ethical responsibility include the following:,competence,confidentiality,integrity,objectivity,The ethical standards related to Miller’s current dilemma are integrity, competence and objectivity. Using th。