AC114

What is a MANAGEMENT?
“ a judicious use of means to accomplish an end”
 Planning
 Involves of setting of both immediate and long range
goals for organization.

 Controlling
 Sees to it that operations are carried out in the best
possible way.
WHY?
 Planning – setting of objectives, forecasting,
making choices among alternative course of
action.
 Controlling – Setting of standards from which
to measure performance.
 Refers to reports designed to meet the needs of
internal users, particularly managers.
 Application of appropriate techniques and
concepts in processing the historical and
projected economic data.
 Covers BROADER SCOPE.
 Finance
 Economics
 Operations Research
 Statistics
 Mathematics
Aspects Financial Acctg. Management Acctg.
Users External Internal
Concept Accounting Equation Full Cost Accounting,
Differential and
Responsibility
Accounting
Accounting Principles GAAP Not Necessarily GAAP
Preparations of Report Mandatory Entirely Optional
Use of Nonmonetary Primarily Monetary in Non- Monetary
Information nature Information
Projected Data Historical Data Current and Future
Precision More or Less precise or Timeliness and
accurate Relevance
Amount of Detail Compressed and Extensive and Detailed
Simplified
Source of Data Company’s Accounting Statistics and economic
System information
Purpose To produce financial For planning, directing
statement and controlling
Focus of reports Business as a whole On segment
(Departmentalize)
A. GAAP
B. Qualitative and Quantitative information
Chief management accounting executive of an
organization.
 Accounting Aspects
 Managment Planning
 Control
1. Planning for Control
2. Reporting and Interpreting
3. Evaluating and consulting
4. Tax Administration
5. Government reporting
6. Protection of Assets
7. Economic Appraisal
 Controllership Treasurer
Planning and Control Provision of capital
Reporting and Interpreting Investor relation
Evaluating and Consulting Short-term financing
Tax Administration Banking and Custody
Government reporting Crerdit and collection
Protection of assets Investment
Economic appraisal Insurance
Controlling involves setting of both immediate
and long range goals for the organization,
predicting future conditions that are expected to
prevail and determining the best strategy to use
so that the goal set may be achieved.
Controlling involves setting of both immediate
and long range goals for the organization,
predicting future conditions that are expected to
prevail and determining the best strategy to use
so that the goal set may be achieved.

It's not the role of Controlling, it is the role of

PLANNING.
Only quantitative information is needed by
management to carry out its decision making.
Only quantitative information is needed by
management to carry out its decision making.

“Management decisions rely on Quantative and

Qualitative information.
COST - VOLUME - PROFIT

AND

BREAK-EVEN ANALYSIS