Variance analysis is a technical jargon used to explain a situation where actual result or outcome of an event significantly and materially differs from planned, expected or targeted results or outcomes. Note the emphasis on the words significant and materiality. In accounting, materiality is defined as a situation where the omission or inclusion of an [...]
Financial planners are one of those professionals that we cannot do without if we realy want to better our finances. We all make decisions on a daily basis, we decide on what to eat, wear, drink, read, phone calls to make, places to visit, etc. we even plan for our finances (consciously or unconsciously). Failing [...]
Budgeting process or budgetary system is a critical thinking area of managerial decision making that management accountants needs to handle with care else, make grave mistake that may cost the business all it has ever worked for. Budgetary system talks about the steps that should be followed by managers to make a reasonably implementable budget. It [...]
Budgeting in its general sense is the act of quantifying objectives in financial terms. Budgeting assists managers in decision making process in an organization. It is the function of the management accountant to provide information needed in budgeting process. A management accountant must be happy with the functions of budgeting described here. This article will [...]
Functions of management accounting cannot be fully appreciated if a working definition and explanation of what a management accounting is all about is not reasonably provided. To this end, I would like to start this article by providing a brief description of what management accounting is below. WHAT IS MANAGEMENT ACCOUNTING? Management accounting is the [...]
Decision making process involves strategic planning and control activities. It is a universal fact that information produced by management accountants must be evaluated in the light of its final effect on the outcome of decision made based on it. And therefore presupposes that it is a necessary precedent for accountants to fully understand the decision [...]
