Advanced Management Accounting
Introduction
Module Aims
This module builds on your previous studies of Management Accounting to critically evaluate the role
of management accounting and accountants in strategic management and management control.
Many of the topics move beyond the technical aspects of management accounting in order to provide
you with a more critical and theoretically informed understanding of issues in management
accounting research AND practice.
To succeed in this module, it is crucial that you engage with the materials posted on Moodle, attend
the lecture engagement/seminar sessions and that any required reading is done during the course and
not left until just before the examination.
Seminars (asynchronous/synchronous)
Six, 1-hour seminars (on campus, face-to-face) over 2 semesters. The seminar weeks are highlighted
in your module outline
Your specific session will appear on your timetables.
The materials for these sessions will be available before each session.
Prepare your own answers for each seminar’s questions beforehand.
Attend the seminars and be prepared to share and discuss your answers.
Everybody is expected to be well prepared and participate in the discussions!
Method and Criteria of Assessment
One 2000 words individual coursework (50%).
o Topic will be announced by week 7 (week commencing 2nd November).
o To be submitted by 3pm on 8th February 2021.
One 2-hour examination, choose 2 out of 3 questions.
o Depending on developments with COVID 19, the exam may be conducted using one of the
following methods.
o On campus, invigilated, exam.
o Online, invigilated, exam.
o Take home exam.
Specific information will be communicated closer to the exam period in the second semester.
No textbook readings – all materials will be provided on the Moodle page.
Lecture 1 – Whence Management Accounting
Accounting is:
The process of identifying, measuring and communicating economic information to permit informed
judgements and decisions by users of the information (AAA).
These users include:
o External users: Shareholders, Creditors, Government Agencies, etc.
o Internal users: Management and Employees.
Financial Accounting is concerned with providing information to external users.
Management Accounting is concerned with providing information to managers.
What do Managers Do?
Managers carry out four major activities:
Planning,
Directing and motivating
Controlling, and
Decision making.
, Advanced Management Accounting
From cost accounting to traditional management accounting
Before the 1950s
No such thing as ‘Management Accounting’
The primary focus of ‘internal accounting’ was the determination and control of costs (cost
accounting)
o Costs of products and departments,
o Controlling DL, DM and OH costs
In an exaggerated sense, the cost accountants main mission might have been depicted as the pursuit of
absolute truth, where truth was defined in terms of getting as accurate or precise costs as possible . . . .
[While in management accounting] the theme of ‘different costs for different purposes’ was stressed.
(Horngren, 1975:9-10 cited in Scapens 1985)
Starting from the 1950s, there was an increasing awareness of the view that cost information should be
appropriate to the needs of the managers.
Management accounting developed as it became recognized that accounting developed as it became
recognized that accounting information could be widely used in both managerial planning and
managerial control.
They continue to measure and control costs.
o Product costing (eg. , job-order and process costing).
o Valuing inventory (e.g., absorption, variable costing).
o Cost allocations (e.g., joint cost allocations and allocating service department costs).
o Cost Classifications (e.g., fixed and variable costs).
o Cost estimation techniques.
o Learning curves.
o However, the also do much more . . .
“Formulating long- and short-term plans (planning)”
Relevant costs for decision making.
CVP analysis.
Product mix decisions.
Other decisions (e.g. economic order quantity).
Budgeting and standard costing.
“Implementing plans (Directing and Motivating)”
Responsibility accounting and evaluating divisionalised operations.
Transfer pricing
Budgeting and variance analysis
Characteristics of Traditional Management Accounting
Historial
Single entity
In-ward looking
Manufacturing focus
Introduction
Module Aims
This module builds on your previous studies of Management Accounting to critically evaluate the role
of management accounting and accountants in strategic management and management control.
Many of the topics move beyond the technical aspects of management accounting in order to provide
you with a more critical and theoretically informed understanding of issues in management
accounting research AND practice.
To succeed in this module, it is crucial that you engage with the materials posted on Moodle, attend
the lecture engagement/seminar sessions and that any required reading is done during the course and
not left until just before the examination.
Seminars (asynchronous/synchronous)
Six, 1-hour seminars (on campus, face-to-face) over 2 semesters. The seminar weeks are highlighted
in your module outline
Your specific session will appear on your timetables.
The materials for these sessions will be available before each session.
Prepare your own answers for each seminar’s questions beforehand.
Attend the seminars and be prepared to share and discuss your answers.
Everybody is expected to be well prepared and participate in the discussions!
Method and Criteria of Assessment
One 2000 words individual coursework (50%).
o Topic will be announced by week 7 (week commencing 2nd November).
o To be submitted by 3pm on 8th February 2021.
One 2-hour examination, choose 2 out of 3 questions.
o Depending on developments with COVID 19, the exam may be conducted using one of the
following methods.
o On campus, invigilated, exam.
o Online, invigilated, exam.
o Take home exam.
Specific information will be communicated closer to the exam period in the second semester.
No textbook readings – all materials will be provided on the Moodle page.
Lecture 1 – Whence Management Accounting
Accounting is:
The process of identifying, measuring and communicating economic information to permit informed
judgements and decisions by users of the information (AAA).
These users include:
o External users: Shareholders, Creditors, Government Agencies, etc.
o Internal users: Management and Employees.
Financial Accounting is concerned with providing information to external users.
Management Accounting is concerned with providing information to managers.
What do Managers Do?
Managers carry out four major activities:
Planning,
Directing and motivating
Controlling, and
Decision making.
, Advanced Management Accounting
From cost accounting to traditional management accounting
Before the 1950s
No such thing as ‘Management Accounting’
The primary focus of ‘internal accounting’ was the determination and control of costs (cost
accounting)
o Costs of products and departments,
o Controlling DL, DM and OH costs
In an exaggerated sense, the cost accountants main mission might have been depicted as the pursuit of
absolute truth, where truth was defined in terms of getting as accurate or precise costs as possible . . . .
[While in management accounting] the theme of ‘different costs for different purposes’ was stressed.
(Horngren, 1975:9-10 cited in Scapens 1985)
Starting from the 1950s, there was an increasing awareness of the view that cost information should be
appropriate to the needs of the managers.
Management accounting developed as it became recognized that accounting developed as it became
recognized that accounting information could be widely used in both managerial planning and
managerial control.
They continue to measure and control costs.
o Product costing (eg. , job-order and process costing).
o Valuing inventory (e.g., absorption, variable costing).
o Cost allocations (e.g., joint cost allocations and allocating service department costs).
o Cost Classifications (e.g., fixed and variable costs).
o Cost estimation techniques.
o Learning curves.
o However, the also do much more . . .
“Formulating long- and short-term plans (planning)”
Relevant costs for decision making.
CVP analysis.
Product mix decisions.
Other decisions (e.g. economic order quantity).
Budgeting and standard costing.
“Implementing plans (Directing and Motivating)”
Responsibility accounting and evaluating divisionalised operations.
Transfer pricing
Budgeting and variance analysis
Characteristics of Traditional Management Accounting
Historial
Single entity
In-ward looking
Manufacturing focus
