Bobby Perdana Putra

20150420271
Kelas C Akuntansi Manajemen

RESUME CHAPTER 1

INTRODUCTION: THE ROLE, HISTORY, AND

DIRECTION OF MANAGEMENT ACCOUNTING

A management accounting information system is an information

system that produces outputs using inputs and processes needed to satisfy

specific managerial objectives. The inputs of a management accounting

information system are economic events. The processes transform the inputs

into out-puts and are such things as collecting, measuring, storing, analyzing,

reporting, and managing. Typical outputs include special reports, product

costs, customer costs, performance reports, budgets, and personal

communication. The three objectives of a management accounting information

system are as follows: To provide information for costing out services,

products, and other objects of interest to management; to provide information

for planning, controlling, evaluation, and continuous improvement; and to

provide information for decision making.

Exhibit 1-1 Operational Model: Management Accounting

Information System

Inputs Processes Outputs

Users
 All organizations—manufacturing, merchandising, and services—must

have a good management accounting information system. Management

accounting concepts and procedures are not restricted to any one type of

organization. The users of management accounting information are managers

and workers within the organization. Anyone internal to an organization is a

potential user of management accounting information.

Management accounting information is used to cost out objects (for

example, services and products) and to aid in planning, controlling, evaluation,

continuous improvement, and decision making. Both financial and

nonfinancial information should be provided by the management ac-counting

information system. Nonfinancial information provides insights useful for

con-trolling operations—it is easily used by operational workers. Financial

information is critical for evaluating the success of operational control.

Continuous improvement means searching for ways of increasing

overall efficiency and productivity of activities by reducing waste, increasing

quality, and reducing costs. Employee empowerment is allowing operational

workers to plan, control, and make decisions without explicit authorization

from middle- and higher-level managers. Operational workers must be

informed so that they can evaluate and monitor the effectiveness of their

decisions. Planning establishes performance standards, feedback compares

actual performance with planned performance, and con-trolling uses feedback

to evaluate deviations from plans. Performance reports are formal reports that

compare actual data with planned data or benchmarks and thus provide signals

to managers that allow them to take corrective actions. More accurate product
costs were not offset by the incremental benefits of improved decision making.

However, significant changes in the competitive environment have in-creased

the cost of making bad decisions, thus increasing the benefits of more accurate

information. Also, information technology has decreased the cost of

processing data. These two events have led to a demand for an improved

management accounting information system.

Exhibit 1-2 Comparison of Management Accounting and

Financial Accounting

Management Accounting Financial Accounting

Internally focused Externally focused

No mandatory rules Must follow externally imposed

rules

Financial and nonfinancial Objective financial information

information: subjective information

possible

Emphasis on the future Historical Orientation

Internal evaluation and decisions Information about the firm as a

based on very detailed information whole

Broad, multidisciplinary More self-contained

 Activity-based management is an important approach that focuses

management’s attention on activities with the objective of improving the value

received by the customer and the profit achieved by providing this value. It is

important because it is the heart of the contemporary management accounting

system, offering increased accuracy in product costing (through the use of

activity-based costing) and the ability to evaluate and control activities

(through process value analysis).

Customer value is the difference between customer realization (what

a customer receives) and customer sacrifice (what a customer gives up).

Focusing on customer value forces managers to consider the entire set of

value-chain activities, including what happens after a product is sold. This

creates a demand for a broader set of information than that found in a

traditional system. While, the internal value chain is the set of activities

required to design, develop, produce, market, distribute, and service a product

(the product can be a service). To increase customer value, managers must

assess the effect each activity in the chain has on customer value, keeping those

that add value and eliminating those that do not.

Management accountants are responsible for identifying, collecting,

measuring, analyzing, preparing, interpreting, and communicating information

used by management to achieve the basic objectives of the organization.

Ethical behavior is concerned with making right choices and usually involves

sacrificing individual self-interest for the well-being of others. It is possible to

teach ethical behavior in virtually any course. By being introduced to ethical

dilemmas in management accounting, students can be made aware of the

behavior that is expected in the business world and, in particular, for

management accountants.

The three forms of certification are the CMA, the CPA, and the CIA.

Although each certification can be valuable for management accountants, the

CMA is tailored to fit their needs. The CPA has a public-accounting

orientation, and the CIA has an internal-auditing orientation. Only the CMA

specifically addresses the professional requirements of a management

accountant. The Sarbanes-Oxley Act (SOX) established stronger government

control and regulation of publicly-traded companies in the United States. Major

sections of SOX include: establishment of the Public Company Accounting

Oversight Board, enhanced auditor in-dependence, tightened regulation of

corporate governance, control over management, and management/auditor

assessment of the firm’s internal controls. SOX also requires public companies

to state whether or not the top corporate officers are bound to the company code

of ethics.