Management Accountimg

ACCA
#1

So much of the focus today is on ACA and ACCA and this is understandable in an atmosphere where auditing, corporate governance and money laundering etc. are at the forefront. However there are other forms of accounting which seem to be taking a back seat and these include management accounting which of course relates to ACMA qualifications.
Management accountants are the life blood of so many organisations and the training for them is vital. A combined degree in management and accounting is a sound start, as is a degree in pure accounting.
Understanding costing as well as management accounting is also vital and it seems to me that the private business schools are well set up for this but the standard universities are somewhat lacking.
The training for this can be done in many work places but if we are to rebuild manufacturing in this country this class of accountant is vital.

I would appreciate people’s thoughts or experiences relative to this qualification as I fear it is being left out of many discussions.

#2

The element of Management Accounting has I think taken somewhat of a back seat as the manufacturing industry in this country has fallen away. Traditionally the place of a Cost and Management was in manufacturing and now they have had to adjust their position. There is no doubt they have a place in business as the production of management accounts is a prerequisite for the good running of any business as unlike Financial Accounting it s not based solely on historical data but is forward looking.
The definition of management accounting 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” (CIMA Official Terminology).
Surely in today’s world of tight margins, restricted cash flow and demands under Corporate Governance for responsible reporting management accountants should be in great demand.

Are there any management accountants out there who can comment on my thoughts?

#3

Not that I have much practical experience so apologies if I am being naive but my feeling is that management accounting is being largely ignored throughout undergraduate and postgraduate studies. I hadn’t really thought about it being linked to the manufacturing industry but I think you may be onto something there. Don’t get me wrong it is taught as a core subject and I quite enjoyed it but I haven’t heard many of my fellow students show a passion for management accounting, not really sure why… hmm interesting! I will explore this as I’m curious now too 

#4

I did a little research and the only universities I could find that were offering specific degrees in management accounting are Sheffield, Nottingham and Bristol. There are many that deal with this area in a generalist way but that to me rather downplays the importance of this area.
There are vast differences in the knowledge base of a financial accountant to that of a management accountant. The management accountant feels the operations of a business in a way that a financial accountant does not and is part of its heartbeat.
I am not sure how the benefits of a good management accountant can be expounded on but clearly there is work that needs to be done.
Are there any management accountants out there who could comment on their training and how they fit into today’s business world?

#5

Hi David

I am a Management Accountant and very pleased to be one. I do however agree that the position does appear in some areas to be undervalued. The CIMA qualification is a very professional one and the process of qualification very thorough.
The tasks that I undertake are vital to the manufacturing company I work for as I am the person who produces forward looking figures. the budget is my responsibility and is the task of costing contracts that will ensure that the company only enters into these on the basis of what is profitable.
Cash flow is not my area but the budgets that are produced are a link to the cash flow.
I also have a strong control over the purchasing department to ensure that hey adhere to best practices.
The role of the manufacturing accountant cannot be underestimated as we are an essential of forward planning.
The problem is that the demise of manufacturing which was the life blood for management accountants, has meant that the way in which students see this area of work is now not seen with such excitement. That and the fact that ACCA students seem to be infiltrating!