Semester September 2014 January 2015

1

Faculty of Accountancy
UiTM Shah Alam


Course Name: Management Accounting & Performance Evaluation

Lecturer: Muhamad Ridzuan Bin Hashim
Course Code: MAF 635 Room/Phone: Level 6 PF81 / 013-3452590
Credit Hr: 3 e-Mail: ridzuan@salam.uitm.edu.my
Semester: September 2014 January 2015 Consultation: by appointment

Course Synopsis The course discusses evolution of management accounting and different techniques of strategic
management accounting in contemporary business environment. The topics covered include
performance evaluation, management control, motivational, behavioural and ethical issues as well as
recent developments in management accounting.
Course Objectives To develop analytical ability in using management accounting information for strategic planning,
performance evaluation and management control, incorporating motivational, behavioral and ethical
considerations. In addition, to enable students to understand the contemporary role of management
accounting in modern business environment.
Learning Outcomes At the end of the course, students should be able to:
1. Describe the evolution of management accounting in a business environment.
2. Apply contemporary strategic management accounting techniques for planning, control and decision
making purposes.
3. Evaluate business performance using appropriate performance measures.
4. Apply transfer pricing and assess its impact on decentralized organizations.
5. Incorporate motivational, behavioral and ethical issues in strategic planning, control and decision
making.
6. Understand current issues in Management Accounting.



Semester September 2014 January 2015

2

PLANNED ACTIVITY
MANAGEMENT ACCOUNTING & PERFORMANCE EVALUATION
MAF 635

WEEK DATE TOPIC DURATION DETAILS TEACHING & LEARNING MATERIALS ASSESSMENT
1 Sept
8 12

INTRODUCTION

3 hours


Introduction to Management
Accounting and Performance
Evaluation course. Ice breaking,
organize grouping and topic for
presentation
Introduction to evolution of MA
accounting using IFAC model
(International Federation of
Accountants)
Relevance Lost - relevance of
traditional management accounting
techniques in the modern business
environment and the emerging of SMA
Syllabus contents and lesson plan.
Abdel-Kader, M., and Luther, R. (2008)

Test

2

3


4
Sept
15 19

22 26

Sept/Oct
29 3

STRATEGIC
MANAGEMENT
ACCOUNTING
9 hours Contemporary strategic management
accounting techniques
o Justintime (JIT) and back flush
accounting
o Total quality management (TQM),
including quality costs
o Target costing
o Business process re-engineering vs.
continuous improvement
o Customer Profitability Analysis
o Life cycle costing
o Kaizen costing
o Electronic commerce, MRP, MRP II,
ERP, CAD/CAM Robotics
o Pareto Analysis
Isa, C.R., Keong, T.Y. (2008)
Hashimi, K. (2009)
Vijayalakshmi (2004)
Smith, M, Dikolli, S (1995)
Monden,Y, Hamada ,K (1991)
Drury 7
th
ed Ch 21 & 22
Logan, N (2002)

Test
Final Exam
SMA Project


Semester September 2014 January 2015

3


5



6

7

8



Oct
6 -10
Mid Sem
Break

13 17

20 24

27 31



PERFORMANCE
MANAGEMENT SYSTEM

9 hours Characteristics of a well-designed
management accounting and control
system
Responsibility accounting
Responsibility centres
o Centralization + decentralization
o Motivation for decentralization
Financial performance measures for
profit organizations
o Objectives
o Financial measures of performance
evaluation
i. Return on investment (ROI)
ii. Residual income (RI)
iii. Economic value added (EVA)
CIMA July 2002, Technical Briefing
Ong, T. S., Teh, B. H., Lau, C.K., (2010)
Mohamed, R., Wee, S.H., Abdul-Rahman,
I.K., Abdul-Aziz, R. (2010)
Langfield et al (2009) Chapter 13 and 14 *
main reference for PMS topic
Drury (2008) Chapter 19* supporting
reference


Final Exam




























SMA Project

Performance evaluation for service
organizations
o Performance evaluation model
Performance evaluation for non-profit
organizations
o Value for Money (5Es)
Contemporary aspects of performance
evaluation
o Globalization and organizational
development
o Organizational Critical Success
Factors
Non-financial measures
o Benchmarking
o Balanced Scorecard

Semester September 2014 January 2015

4


9

10

11
Nov
3 7

10 14

17 21



MANAGEMENT
CONTROL FOR
DECENTRALIZATION

9 hours


Transfer pricing
o Objectives of transfer pricing
o Methods of transfer pricing
Cost based
Market based
Negotiated
o Transfer prices in imperfect markets
and where no market exists for
intermediary product
o Problems of setting transfer prices
and divisional conflicts
o Transfer pricing to achieve goal
congruence
o Calculation of profit for divisions and
overall company profits
Drury (2008) Chapter 20 *main reference
for transfer pricing topic
Langfield et al (2009) Chapter 12 *
supporting reference

Final Exam
o Dual pricing
o International transfer pricing

12


13


Nov
24 28

Dec
1 5






MOTIVATIONAL
BEHAVIOURAL AND
ETHICAL ISSUES IN
PERFORMANCE
EVALUATION
6 hours Link between performance evaluation
and organizational reward system
o Ethical issues in performance evaluation
(ethical consideration is not a standalone
issue. It should be covered together with
reward as well as sustainability)
Langfield et al (2009) Chapter 13 * main
reference for Motivational, behavioural and
ethical issues topic
Eldenburg, Brooks, Oliver, Vesty, Wolcott
(2005), Contemporary Management
Accounting Chapter 11





Final Exam
Presentation
Quiz (exam
topics only)

o Motivational theories:
o Expectancy theory
o Maslow theory of needs
o Hertzberg theory
o Equity theory
o Carrot and stick theory
o Mc Clellands theory of needs
o Theory X, theory Y and theory Z
o Goal setting theory
Not to be
examined,
presentation by
students

Semester September 2014 January 2015

5


14

15
Dec
8 12

15 19


RECENT
DEVELOPMENT IN
MANAGEMENT
ACCOUNTING
6 hours

o Sustainability and Management
accounting
o Environmental Management Accounting
(EMA)
o Sustainability and EMA
o Environmental Costs
o Improving Supply Chain Management
Through Measuring Environmental and
Social Impacts
o Sustainability and Performance
Measurement
o Strategic Performance Measurement
System and Sustainability
o Climate Change and Management
Accounting
Langfield et al (2009) Chapter 17 * main
reference for Sustainability and
Management accounting topic
Eldenburg, Brooks, Oliver, Vesty, Wolcott
(2005), Contemporary Management
Accounting Chapter 16 supporting
reference for Sustainability and
Management accounting topic.
A Guide To Environmental Reporting by
Ivan Lim, Flemming Ytzen, Sarah
Sabaratnam
Environmental management Accounting
Part 1

Final Exam

Dec
22 26
Revision Week
Public holiday; Malaysia day 16/9/2014: Hari Raya Haji 5/10/2014: Deepavali 23/10/2014: Awal Muharram 25/10/2014: Sultan of Selangor Birthday 11/12/2014: Christmas 25/12/2014.

Textbook:
Kim Langfield Smith, Helen Thorne, Ronald W. Hilton (2012), Management Accounting, 6
th
Edition, McGraw Hill.
Drury, C. (2008), Management and Cost Accounting, 7
th
Edition, Thomson Publishing.
Eldenburg, Brooks, Oliver, Vesty, Wolcott (2005), Contemporary Management Accounting

Overall Assessment
Final Exam 60%
Common Test 15%
*Group project on SMA (presentation and report) 15%
*Group project on Motivation theory (presentation and quiz) 10%
100%

* Each group must provide a copy of presentation note for each student.
* All presentation materials must be shared with other students
* Group presentation (maximum 4 members in a group)

Semester September 2014 January 2015

6

List of Articles
Abdel-Kader, M., and Luther, R. (2008) The Impact Of Firm Characteristic On Management Accounting Practices: A UK-Based Empirical Analysis, British Accounting
Review
Isa, C.R., Keong, T.Y. (2008) JIT Manufacturing And Purchasing Practices And Business Performance: An Exploratory Study, Asia-Pacific Management Accounting
Journal, Vol 3(1).
Hashmi, K. (2009) Introduction and implementation of TQM, retrieved on 12Feb2009 from http://www.iSixSigma.com
Vijayalakshmi (2004) BPR Manufacturing Industry Perspective, www.wipro.com
Smith, M, Dikolli, S (1995) Customer Profitability Analysis: An ABC Approach, Managerial Auditing Journal, Vol. 10 (7)
Logan, N (2002) Pareto Analysis: When Quality-Control Demands Decisions
Monden,Y, Hamada ,K (1991) Target Costing and Kaizen Costing in Japanese Automobiles Companies
CIMA July 2002, Technical Briefing Latest Trend in Corporate Performance Measurement
Ong, T. S., Teh, B. H., Lau, C.K., (2010) Adoption and Implementation of Balance Scorecard in Malaysia, Asia-Pacific Management Accounting Journal, Vol 5(1).
Mohamed, R., Wee, S.H., Abdul-Rahman, I.K., Abdul-Aziz, R. (2010) The Relationship Between Strategic Performance Measurement Systems And Organisational
Competitive Advantage, Asia-Pacific Management Accounting Journal, Vol 5(1).
A Guide To Environmental Reporting by Ivan Lim, Flemming Ytzen, Sarah Sabaratnam