What are the functions of management accounting

Management accounting aims to improve the economic efficiency of enterprises, and through a series of specialized methods, the use of financial accounting and other information provided by processing, organizing and reporting, so that managers at all levels of the enterprise can be based on the day-to-day occurrence of the economic activities of the planning and control, and to help decision makers to make a variety of specialized decision-making a branch of accounting. Management accounting is playing an increasingly important role in the financial management activities of enterprises. In the core concept of management accounting, value creation and maintenance are the two most important points. Based on this, management accounting is the most effective tool for the integration of strategy, business and finance in an enterprise.

The role of management accounting

(1) Provide management information

Modern enterprise production and operation activities require a large amount of economic information, not only need financial accounting to provide information on financial costs, operations, and so on, but also need to be able to adapt to the internal management of the enterprise with a variety of management information. These management information includes both the further processing of financial information, including a large number of non-financial information with a specific form and content, such as actual and expected, historical and future, local and global, technical and economic information. Only in this way can the enterprise managers plan and control the future production and operation activities accordingly and achieve the expected goals. Management accounting is not subject to the relevant accounting laws and regulations and fixed accounting programs, and can use a variety of technical methods, so it is possible to process, organize and reform the information obtained from a variety of different channels, so that it becomes the data that meets the requirements of the internal management of the enterprise, and becomes the management information required to meet the needs of managers to carry out forecasting, decision-making, planning, control and other kinds of work

(2) Directly involved in decision-making

Decision-making is the core of modern business management. Decision-making process is the process of managers to choose and decide the future program of business activities. Only by making all kinds of decisions correctly, the enterprise can realize the optimal operation of future production and operation. However, to make correct decisions, not only need to obtain and provide timely management information, but also need to scientifically process and effectively utilize management information. Management accounting proactively participate in the business management process, correctly proposed and evaluated decision-making programs, to help managers at all levels of the enterprise to make the right decisions, in fact, it will put itself in the decision-making process, directly involved in the business management activities.

(3) Implementation of performance appraisal

In order to ensure the realization of the predetermined goals, the production and management process and its results must be closely tracked and monitored, will reflect the completion of the business objectives and business plans to implement the actual situation of the process, and the predetermined goals, plans, budgets and other comparative analysis and inspection and assessment. Here production and operation activities can be carried out in accordance with the principle of optimization of the important means, but also to measure and control the decision-making, planning and actual implementation, and ultimately achieve the expected business objectives of a reliable guarantee. In the enterprise production and operation process and results of control, assessment of the issue, management accounting can establish a complete control system, but also to determine the strict assessment measures, so that at any time to grasp the process of realizing the business objectives of the modern enterprise, the correct assessment of the work performance of the relevant departments within the enterprise, and for the revision of the decision-making, adjusting the plan to provide an objective basis.