Managerial Accounting Essay

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Managerial Accounting in Health Care Organizations Please answer each of these ten (10) questions, most of which come directly from the lectures and class notes available on Blackboard. 1. What is managerial accounting and how is it helpful to an organization? The definition of managerial accounting, according to CIMA (Chartered Institute of Management Accountants) is, the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of information used by management to plan, evaluate and control within an entity and to assure appropriate use of and accountability for its resources. Management accounting also comprises the preparation of financial reports for non-management groups such as shareholders, creditors, regulatory agencies and tax authorities" According to American Institute of Certified Public Accountants (AICPA) management accounting is helpful to an organization in the following ways: • Strategic Management—advancing the role of the management accountant as a strategic partner in the organization. • Performance Management—developing the practice of business decision-making and managing the performance of the organization. • Risk Management—contributing to frameworks and practices for identifying, measuring, managing and reporting risks to the achievement of the objectives of the organization. These three key factors along with leadership qualities and the ability to continuously learn and improve allow managerial accounting to help identify, measure, accumulate, analyze, prepare, interpret information to plan, evaluate, and control accounting practices of an organization. 2. What are the four dimensions used in Robert Kaplan’s “Balanced Scorecard”? • Financial ▪ The "financial perspective" encourages the identification of relevant high-level financial

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