0% Plagiarism Guaranteed & Custom Written

Analyse the purpose for developing and presenting financial information

Unit 14:      Advanced Management Accounting

Unit code   Y/508/0537

Unit level 5

Credit value     15

Introduction

The overall aim of this unit is to develop students’ understanding of management accounting. The focus of this unit is on critiquing management accounting techniques and using management accounting to evaluate company performance. Students will explore how the decisions taken through the use of management accounting techniques influence managerial behaviour across an organisation.

On successful completion of this unit students will be in a position to support an organisation to create value through effective decision-making where management accounting is used, to some degree, to control members of an organisation. In addition, students will have the fundamental knowledge and skills to progress on to a higher level of study.

Learning Outcomes

By the end of this unit students will be able to:

  1. Analyse the purpose for developing and presenting financial information.
  2. Evaluate the use of management accounting techniques to support organisational performance.
  3. Analyse actual and standard costs to control and correct variances.
  4. Evaluate how a changing business environment impacts on management accounting.


Essential Content

LO1 Analyse the purpose for developing and presenting financial information

Users of financial information:

This would include investors, senior management, banks and government.

 

Developing financial statements:

Critiquing why financial information should be developed into statements.

The value of financial statements in support of a financial plan and decision- making.

 

Presenting financial information:

Critiquing the use of profit and loss statements, trial balances, cash flow statements and balance sheets as methods to present financial information.


LO2 Evaluate the use of management accounting techniques to support organisational performance

Microeconomic techniques:

These would include cost analysis, cost-volume profit, flexible budgeting and cost variances. Also consider absorption and marginal costing.

 Cost allocation:

Considering the theoretical aspects as well as how this is applied in practice.

 Capital and capital budgeting:

The meaning behind these terms will be discussed, their importance and their use. Techniques include Net Present Value (NPV), Internal Rate of Return (IRR), Discounted Cash Flow (DCF) and pay back periods.


LO3 Analyse actual and standard costs to control and correct variances


Actual costs:

What does this mean?

How is actual cost determined?

How does this differ to estimated or standard costs?


Standard costs:

What does this mean?

How is standard cost determined?

How does estimating standard costs result in variances?

 

Variances:

Variance analysis as a concept and a technique. Negative and positive variances.

How can a negative variance be considered a positive and vice versa?

 

Controlling and correcting variances:

Integrating variance analysis into budget monitoring across an organisation. Reporting systems for monitoring and controlling variances.

Schedule variance vs cost variance.


LO4 Evaluate how a changing business environment impacts on management accounting

Analysing changes to a business environment:

Internal and external analysis techniques.

Comparing the outcomes of analysis to inform decisions and to evaluate possible implications for management accounting.


Impact of the business  environment on  management  accounting systems:

Using technology to enhance and support processes and procedures.

The role of improved communication within a system to expedite decision- making.


Impact of change on management accounting  systems: Determining the impact of different types of change. Deciding how to respond to different types of change. Ensuring effective communication and acceptance of change.


Learning Outcomes and Assessment Criteria

 

Pass

Merit

Distinction

LO1 Analyse the purpose for developing and

 

presenting financial information

 

P1 Analyse the purpose

M1 Evaluate how and why

D1 Critically evaluate

and presentation of

financial information

financial information

financial information

should be developed and

supported by effective

from the perspective of

appropriately presented

and appropriate

different stakeholders.

to support financial

judgements.

 

planning and decision-

 

 

making.

 

LO2 Evaluate the use of management accounting techniques to support organisational performance

 

P2 Evaluate the use of different management accounting techniques in application to supporting organisational performance.

M2 Evaluate the value and importance of a range of management accounting techniques by assessing both advantages and disadvantages.

LO2 and LO3

D2 Critically evaluate the application of different management accounting techniques and variances to support conclusions and recommendations.

LO3 Analyse actual and standard costs to control and correct variances

 

P3 Analyse the concept of variance analysis in its importance for organisational budget control.

M3 Evaluate the advantages and disadvantages of different types of variances.

 

P4 Analyse actual and standard costs to control and correct variances.

 

 

LO4 Evaluate how a changing business environment impacts on management accounting

 

 

D3 Critically evaluate the impact of changes, and support justified recommendations for future communication and acceptance of change.

P5 Evaluate how external and internal factors changing the business environment impact upon management accounting.

M4 Determine the impact of different types of change and the decisions made to respond to these changes.


100% Plagiarism Free & Custom Written, Tailored to your instructions