Introduction

In this reflective journal, we will be discussing the experience of learning, the significance of the assessment and material of unit in this particular unit to our understanding of management accounting overall, and our understanding of how techniques and concepts help the managers in making all decisions to actual business issues of the world. We will comment on the knowledge that we have gained regarding managerial accounting and also how it could be beneficial to us in the upcoming period.  We will comment on what we have learned from this individual assessment. We will mention the challenging and interesting things about the individual assignment.

Main Body

I have learned that managerial accounting is the system of accounting that forms documents, reports and statements that assist management in taking effective decisions regarding the performance of the business. I learned that managerial accounting is initially utilized for internal commitments. I gained that the key purpose of managerial accounting is for helping the management of the organization effectively perform all its functions: controlling, directing, organizing and planning. I have also gained that management accounting assists with all these functions in the given ways:

1. Gives data – It serves as an important data source for planning. The past data taken by managerial accounting represent the progress of the business which is beneficial in forecasting (Guinea, 2016, p2 (1))
2. Evaluates data – The data of accounting is accessible in an expressive manner by projecting tendencies and computing ratios. This data is then evaluated for decision-making and planning. For instance, we could classify the purchase of various items territory-wise, supplier-wise and time-wise.
3. helps meaningful consultations – Managerial accounting could be utilized as the means of consulting the action course throughout the whole company. In the primary phases, it describes the consistency and feasibility of the organization of many segments of the plan. It also tells the growth of the plans and also the duties of various parties for implementing them (Guinea, 2016, p3 (4))
4. Aids in obtaining objectives – It assists in converting organizational objectives and goals into feasible objectives of the business. These objectives could be attained by imposing costing of budget standards and control which are vital sections of managerial accounting.

I learned that managerial accounting is beneficial to us in the future as it could be utilized in long-duration and short-duration decisions including the financial health of the organization. Managerial accounting assists the managers in making the operational or functioning decisions – planned to assist in increasing the operational effectiveness of the organization that also assist in making all long-duration decisions of investment. I also learned that tracking, monitoring and forecasting the performance is the crucial factor of managerial accounting for ensuring definite outcomes attains the budget and also forecasts mentioned at the beginning.

I have learned the following things from the individual assignment:

1. Analysis of decisions and management of risks
2. Business Finance
3. Analysis of financial statement
4. Professional morals and ethics for professionals of managerial accounting
5. Interior controls
6. Management of cost
7. Management of performance
8. Forecasting, budgeting and planning(Lück and Leyh, 2016, p1 (3)).

The interesting things that I learned about managerial accounting are given below:

Managerial accounting gives main insights that assist the management team of the company make various decisions. They also assist in decision-making within the organization by giving a wealth of statistical and financial information, frequently supported by effective software of accounting (Lück and Leyh, 2016, p4 (1)).

Managerial accounting could be a valuable and effective tool for the business. It assists us as the owner of businesses makes the correct call on critical decisions like:

1. Planning innovative products to introduce
2. Helping us understand staffing needs
3. Deciding mainly which kinds of products and services are profitable

I have learned that one of the greatest constraints for management accountants in today’s time is the preparation for facing globalization in the global and local markets. An extreme competition, changing regulations of government and innovation in technology and globalization led to alterations in the environment of the market that have major implications for the organization (Rossi, 2015, p3 (7)).

I have also learned that the challenges of managerial accounting usually include reporting, recording and collecting financial data from various departments or divisions. Also, one of the greatest constraints of management accounting is that several of its techniques are not mainly compliant with usually accepted principles of accounting (Rossi, 2015, p6 (1)).

The concepts of managerial accounting that I found interesting that will assist the managers in making accurate decisions regarding actual business issues of the world include:

Managerial accounting helps the business in deciding where, when and how much amount of money for spending as per the financial information or data. I learned that utilizing metrics of capital budgeting like internal rate of return and net present value assists the makers of the decision in deciding whether to board on costly purchases or projects.

The techniques of managerial accounting that I have learnt are given below:

1. Marginal costing
2. Capital budgeting
3. Valuation of inventory
4. Costing of product
5. Analysis of trend
6. Analysis of trend (Isaac, et al., 2015, p1 (3)).

I found Marginal Costing a very interesting technique as it assists organizations to optimize their complete production via economies of scale – the decrease of cost of production as the outcome of selling and making goods in higher quantities. I learned that management accountants utilize this technique for identifying the variance in costing and break-even analysis for mainly direct control of cost, profit increment and decision-making. In the deficiency of this particular information, the organization will not be able to know when production should be expanded (Isaac, et al., 2015, p3 (1)).

Conclusion

By this report, I conclude that making decisions with entire accurate information could become a huge gamble that could bear all fruits or can burn the whole tree to the surface. Managerial accounting gives a deep understanding of details of the resource and finance flow of the organization so we can reach the appropriate decision based on definite data. It also separates what is essential, identifies flaws and gives means for forming long-duration strategies for scaling the business. It also helps in tracking expenditures and income and also provides measurable financial data which could be utilized in making decisions forthe business.

References

Guinea, F.A., 2016. THE NEED FOR MANAGERIAL ACCOUNTING SYSTEMS. SEA: Practical Application of Science, 4(3).https://seaopenresearch.eu/Journals/articles/SPAS_12_5.pdf

Isaac, L., Lawal, M. and Okoli, T., 2015. A systematic review of budgeting and budgetary control in government owned organizations. Research Journal of Finance and Accounting, 6(6), pp.1-11.https://core.ac.uk/download/pdf/234630573.pdf

Lück, D. and Leyh, C., 2016. Toward Business Domain-Specific Collaboration: requirements for integrated virtual cooperation in product costing.https://core.ac.uk/download/pdf/301368815.pdf

Rossi, M., 2015. The use of capital budgeting techniques: an outlook from Italy. International journal of management practice, 8(1), pp.43-56.https://www.researchgate.net/profile/Matteo-Rossi-7/publication/277655349_The_use_of_capital_budgeting_techniques_An_outlook_from_Italy/links/568abed508ae051f9afa7012/The-use-of-capital-budgeting-techniques-An-outlook-from-Italy.pdf