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MAC3702 Advanced Management Accounting
Comprehensive Exam Bank||Verified Exam!!||, UNISA
School of Accountancy, 2026/2027-Question
Management Accounting Examination with Verified
Solutions
What changes have there been in the business
environment? - Answer-- Increased competition
- Digitisation
- Globalisation
- Emphasis on quality
- More customer focused
- Intellectual capital
- Automation
- Increasing overheads
- Decreasing direct labour costs
- More emphasis on environmental and external issues
Define Strategic Management Accounting - Answer-A form
of management accounting which emphasis is placed on
information which relates to factors external to the firm, as
,2|Page
well as non financial information and internally generated
information.
SMA practises are :
- Externally and competitive focused
- Forwards looking and longer term orientated
- Strategically driven
What is Strategy? - Answer-Strategy describes how an
organisation matches its own capabilities with the
opportunities in the market place to accomplish its overall
objectives. In formulating a strategy an organisation must
thoroughly understand the industry in which it operates
What are Porters 5 Forces? - Answer-- Competitors,
reducing prices of products is critical to the growth of any
industry. Competition is severe along the dimensions of
price, timely delivery and quality.
- Potential Entrants into the Market , competition normally
keeps profit margins small. Existing companies are likely
to have lower costs and the advantage of close
relationships with customers.
- Equivalent products
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- Bargaining power of customers , can customers obtain
the same or a similar product from another supplier
- Bargaining power of supplies
What are the 3 generic strategies that companies use ? -
Answer-- Product differentiation, offering products and
services that are perceived by customers as being
superior and unique relative to those of its competitors
- Cost leadership
- Focus, dealing only with a segment of the market and
looking for cost benefit or differentiation within this market
segment
What are the ideas behind Lost Relevance Theory? -
Answer-Today's management accounting information,
driven by the procedures and cycle of the organisations
financial reporting system, is too late, too aggregated and
too distorted to be relevant for managers planning and
control decisions. With increased emphasis on meeting
quarterly or annual earnings targets, internal accounting
systems focus narrowly on producing a monthly earnings
report.
, 4|Page
What are the main issues with traditional management
accounting techniques ? - Answer-- Financial Accounting
Mentality
- Short-termism, monthly performance reports have
encouraged management to focus excessively on
achieving short term financial performance even if this
leads to the long term health of the company being
compromised.
- Control of Direct Labour
- Problems of Overhead Allocation, inappropriate methods
for assigning overheads to products. Direct labour isn't a
good measure due to the increasing use of new
technology (I.e robotics)
- Cost Control Efficiency Productivity , MA reports are of
little help to managers as they attempt to reduce costs and
improve productivity. Unable to provide timely information
for decision making.
- Tends to focus on internal organisational performance
with little emphasis on external and social issues.
- Neglects the high cost of post conversion activities
(warranties)
- Performance measures, what should the management
accountant actually measure
MAC3702 Advanced Management Accounting
Comprehensive Exam Bank||Verified Exam!!||, UNISA
School of Accountancy, 2026/2027-Question
Management Accounting Examination with Verified
Solutions
What changes have there been in the business
environment? - Answer-- Increased competition
- Digitisation
- Globalisation
- Emphasis on quality
- More customer focused
- Intellectual capital
- Automation
- Increasing overheads
- Decreasing direct labour costs
- More emphasis on environmental and external issues
Define Strategic Management Accounting - Answer-A form
of management accounting which emphasis is placed on
information which relates to factors external to the firm, as
,2|Page
well as non financial information and internally generated
information.
SMA practises are :
- Externally and competitive focused
- Forwards looking and longer term orientated
- Strategically driven
What is Strategy? - Answer-Strategy describes how an
organisation matches its own capabilities with the
opportunities in the market place to accomplish its overall
objectives. In formulating a strategy an organisation must
thoroughly understand the industry in which it operates
What are Porters 5 Forces? - Answer-- Competitors,
reducing prices of products is critical to the growth of any
industry. Competition is severe along the dimensions of
price, timely delivery and quality.
- Potential Entrants into the Market , competition normally
keeps profit margins small. Existing companies are likely
to have lower costs and the advantage of close
relationships with customers.
- Equivalent products
,3|Page
- Bargaining power of customers , can customers obtain
the same or a similar product from another supplier
- Bargaining power of supplies
What are the 3 generic strategies that companies use ? -
Answer-- Product differentiation, offering products and
services that are perceived by customers as being
superior and unique relative to those of its competitors
- Cost leadership
- Focus, dealing only with a segment of the market and
looking for cost benefit or differentiation within this market
segment
What are the ideas behind Lost Relevance Theory? -
Answer-Today's management accounting information,
driven by the procedures and cycle of the organisations
financial reporting system, is too late, too aggregated and
too distorted to be relevant for managers planning and
control decisions. With increased emphasis on meeting
quarterly or annual earnings targets, internal accounting
systems focus narrowly on producing a monthly earnings
report.
, 4|Page
What are the main issues with traditional management
accounting techniques ? - Answer-- Financial Accounting
Mentality
- Short-termism, monthly performance reports have
encouraged management to focus excessively on
achieving short term financial performance even if this
leads to the long term health of the company being
compromised.
- Control of Direct Labour
- Problems of Overhead Allocation, inappropriate methods
for assigning overheads to products. Direct labour isn't a
good measure due to the increasing use of new
technology (I.e robotics)
- Cost Control Efficiency Productivity , MA reports are of
little help to managers as they attempt to reduce costs and
improve productivity. Unable to provide timely information
for decision making.
- Tends to focus on internal organisational performance
with little emphasis on external and social issues.
- Neglects the high cost of post conversion activities
(warranties)
- Performance measures, what should the management
accountant actually measure
