Management Accounting Essay

3261 WordsFeb 24, 201214 Pages
Introduction The traditional accounting is concerned with rules based accounting methods that incorporate financial measures for reporting purposes (Elias, 2002). The evolution of management accounting has gained momentum in the recent decades due to the failure of the traditional accounting techniques to offer futuristic and non-financial measures to support business decision-making (Page, 2000). The role of management accountants is becoming increasingly important in the global business environment as the development of information technology has offered accountants with the capability to generate financial and non-financial information for the aiding business decisions (Shotter, 2001). This essay critically evaluates the literature offering insight into the role of management accounting in the global business environment. Critical Evaluation of the Role of Management Accountants in a Global Business Environment Jaffe et al. (2006) mention globalisation as a process that facilitates a change in the traditional barriers between countries. The process of globalisation allows the movement of products, resources, people and information across geographical boundaries. The spread of globalisation to the developing and emerging countries has gained momentum in the wake of technological progress. The globalisation process is highlighted by a growth in the multinational enterprises (MNEs) and the scale of international trade. Khan and Jain (2006) argue that the information provided by management accountants is used by the senior management of a firm for business operations for the development of control over the business process. The planning process is frequently sustained by the use of financial plans and forecasts over the future. The management accounting information repeatedly involves considerable use of judgement in assessment of non-financial aspects of the

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