According to the Chartered Institute of Management Accountants (CIMA), Management Accounting is "the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of information used by management to plan, evaluate and control within an entity and to assure appropriate use of and accountability for its Resource (economics)resources. Management accounting also comprises the preparation of financial reports for non management groups such as shareholder's, creditor's, regulatory agencies and tax authorities" (CIMA Official Terminology)

Management Accounting is used to help business owners/managers with their decision making process by providing them with information on the accounting position of the company.  Management Accounting differs to traditional Financial Accounting as Management Accounting provides business owners/managers with information which is forward thinking rather than just historical information and is information which is confidential and used within the business rather than being made public.  Management Accounting can be bespoke to each individual company depending on their needs, Accountancy & Business Consultants Ltd would produce reports which are tailored to what information the business owners/mangers require.

Management Accounting is also sometimes known as ‘cost accounting’, particulary in reference to the more traditional manufacturing industry where Management Accounting would have traditionally included variance analysis, this compared the actual costs to the budgeted costs of the raw materials and labour used for the production of an item.  Whilst variance analysis is still used it nowadays it would often include techniques such as ‘activity based costing’ and ‘life cycle cost analysis’ which take the modern business environment into account.  Management Accounting is now also used in all types of industry and businesses and no longer only thought of with manufacturing.

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