You have 9 weeks 6 days remaining for the course
AD-7: Cost and Management Accounting
Cost and Management Accounting
This course focuses on developing knowledge on performance management gives understanding of internal and external factors that effect organizations. This course will help students to understand fundamental cost and management accounting terminologies, concepts and techniques and their application in planning, decision making and controls. How students can apply management accounting and other techniques to measure the financial and non-financial performance and how to control costs.
Students will also learn latest forecasting techniques, and how to prepare budgets that are uses in almost every function of the organization for a wide range of activities. Student will learn the process about how to finalize budgets with functional managers and measure actual vs budgets results, variance analysis and what decisions are needed by management based on variance analysis. This course will also help students to calculate and apply the concept of Cost Volume Profit Analysis and Break-even analysis.
By the end of the course, students will be able to understand:
- Understanding application of performance management
- Identification of cost and management accounting terminologies and techniques.
- Application of above techniques in measuring performance and controlling costs.
- Internal and external factors that affect the organizations and budgets
- Preparation of management and performance reports for all functional areas of the organization i.e Accounting, Finance, HR, Marketing, Production, Audit and others
- Understanding regarding importance and use of budgets
- Skills required for budgets preparation and how budgets can be controlled
- That organizational costs are controlled and within approved budgetary limits
Nature and purpose of Management Accounting
- Concepts and application to costing, costs classification, and Costs behavior
- Application of costing techniques used for management decision making
- Preparation of management reports for different functional areas i.e Accounting, Finance, Production, HR, Marketing etc
Performance Management, Internal and External Factors
- Concepts of performance measurement & performance management
- Demonstration of Internal and External Factors that Effect organizations
- Information for management, costing systems & management accounting
- Performance Management System and techniques for evaluation of actual verses planned performance
- Use of the financial and non-financial performance measures
- Explain Forecasting and its use in budget preparation
- Cost Estimation and Forecasting using High-Low points Methods
- Forecasting using Linear Regression Analysis and Time Series Method
- How forecasting help in budget preparation
Understanding of budgets and budgetary Committee
- Introduction to budgets and budgetary committee
- An understanding of the management accounting methods and techniques that relates to preparing functional budgets for organizations.
- Role of budget committee in preparation of budgets, and how committee and professional accountants play a vital role in master budget preparation
- Understanding about uses of budgets and how budgets are used to control the costs and to achieve organizational goals.
Preparation of Budgets
- Application of techniques to prepare functional budgets
- Preparation of revised, fixed and flexible budgets
- Preparing of zero-based budgets, activity-based budgeting (ABB) and rolling budgets
- Budgetary controls and reports to management
Variance and Break-Even Analysis
- Variance Analysis
- Cost and Sales Variances
- Operating and Strategic Variance
- Reconciliation of Actual and budgeted profits
- Cost-volume-profit (CVP) analysis and decision making
- Breakeven point with limiting factors for allocation of resources
- Calculation of margin of safety