The interpretation of financial information depends on the capacity of an interpreter as one has to make a personal judgment, personal prejudices and bias affect the objectivity of decisions. The financial accounting data is rearranged for proper analysis. Top and mid-level managers are related to cost accounting activity. Financial accounting helps in making investment decisions and in credit rating. This includes the computation of income following the tax laws, filing of returns, and making tax payments. The objective is to maximize profit through the use of the best alternative method. Well-defined – annually, semi-annually, quarterly. Yes, we are agreed with the statement. Graphs, charts, pictorial presentations, index numbers, and other statistical methods make the information more impressive and intelligible. Advantages and Objectives of Management Accounting There are many objectives of but the prime objective is to assist the management team of an organization in improving the quality of their decisions. Decisions are to be taken by management, and implementation of decisions is also done by management. The modification of data in similar groups makes the data more useful and understandable. are highly useful for planning and forecasting. Functions (or objectives) of Management Accounting. Cost Accounting information are concerned with the current year ignoring future years while management accounting is mainly future-oriented. May pertain to smaller business units or individual departments, in addition to the entire organization. Management accounting uses both quantitative and qualitative information. Management accounting helps in this respect preparing various reports. By preparing budgets and ascertaining specific cost centers, it delivers the resources to each center and delegates the respective responsibilities to ensure their proper utilization. The basic objective of management accounting is to assist the management in performing its functions effectively. The preparation of budgets and adoption of standard costing technique automatically motivates the employees indirectly. It has already been stated that the management accounting of an enterprise is to provide management and other operations as a basis of protective and constructive to management. Both of these branches of accounting help the management in accomplishing their assigned task. Based on these past events, the future course of action is projected. In contrast, financial accounting is concerned with providing information to stockholders, creditors, and others who are outside the organization. Communicate information fairly and objectively. Because it is not mandatory to follow GAAP in management accounting, managers can set their own rules concerning the content and form of internal reports. Similarly, according to the American Accounting Association, “It includes the methods and concepts necessary for effective planning for choosing among alternative business actions and for control through the evaluation and interpretation of performances. There are many objectives of but the prime objective is to assist the management team of an organization in improving the quality of their decisions. Now one technique can satisfy managerial needs. Assembly and consolidation of budget; assistance to management personnel in translating operating plans into financial budgets; reporting and analysis of budget variances. Communicate unfavorable as well as favorable information and professional judgments or opinions. Last of all, we can say that the activities of management accounting are occurred only to perform a vital role in the decision-making process in an organization. In management accounting or managerial accounting, managers use the provisions of accounting information to inform themselves better before they decide matters within their organizations, which allows them to manage better and perform control functions. This is possible through budgetary control and standard costing which are an integral part of management accounting. The accounting data is analyzed meaningfully for effective planning and decision-making. Management accounting is only in a developmental stage that has not reached the final stage. are also important bases for measurement in both the systems. Sometimes the entire business is considered to the principal object of study. The object of management accounting is to provide data. Ratios are calculated and likely trends are projected. Management accounting is concerned with accounting information that is useful to management. Management accounting reports are exclusively used by internal users viz. Management accounting is an important medium of communication. For this purpose, the data is presented in a comparative form, Ratios are calculated, and likely trends are projected. It does not use the whole data provided by financial records. It presents the different alternative plans before the management in a comparative manner. Management accounting contributes a lot to increase the management efficiency of the organization providing managers with the correct information. Management accounting also is known as managerial accounting and can be defined as a process of providing financial information and resources to the managers in decision making. The special cost and economic studies are considered in the management accounting system in order to increase the profits of the concern.

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