Basic Consideration in MAS Management Accounting Environment
Basic Consideration in MAS Management Accounting Environment
Basic Consideration in MAS Management Accounting Environment
Services (MAS)
The Basic Considerations
MAS means -
• Advice and technical assistance (not a decision)
• Utilization of resources
• Achieve organizational goals
• Management Consultant, CPA’s or non - CPAs (education, experience,
technical ability and temperament)
• CPA is preferred
• Different from auditing, tax and legal services
Analytical Approach and Process
• Systematic, objective, and rational method of solving organizational
problems
• Involves professional competence to:
• find facts based on client objectives
• define problems
• identify alternative solutions
• Adopt the most applicable solution then communicate
• Assist the client in the implementation (optional)
• Follow up
CPA management advisory services -
• Pioneering consultancy services
• Finance and Accounting (Financial accounting, management accounting,
financial management
• Non – finance and accounting (General management, Project feasibility
studies, Organization and personnel, Industrial engineering, Marketing,
Operation research)
• Emerging consultancy services
• Management consulting
• Transaction and restructuring
• Risk consulting
• Information technology
Characteristics of MAS
• Rendered for management
• Involves problem solving
• Relates to the future
• Broad in scope
• Involve varied assignments
• Non- recurring
• Highly qualified staff
• Human relations is vital
Code of Professional Ethics -
MAS Fundamental Principles (PICPO)
• Integrity
• Objectivity
• Professional Competence and Due Care
• Confidentiality
• Professional Behavior
Vision/
Mission/ Strategies Structures Standards Systems Actions Reports Evaluation Learnings
Values
Planning
Controlling
Decision Organizing
Making
Directing
and Staffing
Functions of Controllership
• Planning and Controlling
• Reporting
• Evaluation
• Government relations and reporting
• Protection of assets
• Economic appraisal
• Tax administration
Planning and Controlling Cycle
Goals
Objectives
Plans Budgets
Actions Revisions
BOD
President (CEO)
VP Treasurer VP Controller
Treasurer vs. Controller
Treasurer Controller
• Capital budgeting • Cost accounting
• Cash management • Cost management
• Commercial banking and investment banking • General ledger (payroll, AR,/ payable)
relationships
• Credit management • Data processing
• Dividend disbursements and share repurchases • Government reporting (SEC, BIR)
• Financial analysis and planning • Internal control
• Investor relations • Preparing budgets
• Tax planning and analysis • Preparing financial statements
• Insurance/ risk management • Preparing forecasts
• Mergers and acquisition analysis
• Pensions management
MA vs. FA
Accounting Financial &
oRecording, estimating, Operational Data
organizing, summarizing
Financial Management
Standards (CICO)
• Competence
• Confidentiality
• Integrity
• Avoid conflict of interest
• Objectivity (Credibility)
Hierarchy in case of conflict
• Company’s policies
• Immediate superior unless he’s involved
• Next higher managerial level unless he’s involved
• CEO unless he’s involved
• Audit Committee or top officers
• Legal counsel
• Resignation
MA as –
• Strategic Management (differentiation)
• Customer value propositions (Why customers should choose you?)
• Customer intimacy (closeness to customers)
• Operational Excellence (delivery)
• Product leadership (quality, price)
• Enterprise Risk Management (exposure to danger)
• Controls
• Preventive controls (Authorizations, Segregation, Physical safeguards, information
security)
• Detective controls (Reconciliations, Performance reviews, Maintaining records,
information security)
MA as –
• Corporate social responsibility (CSR)
• A care for stakeholders other than the shareholders
• Process Management Perspective
• Functional departments (“chain of command”)
• Business process
• Value chain
• Lean production (JIT)
• Leadership Perspective (unity of behaviors)
• Intrinsic motivation (comes from within)
• Extrinsic incentives (compensation systems)
• Cognitive bias (irrational thinking)
References
• Management Services 2014 Edition, Agamata
• Managerial Accounting Eight Edition, Brewer, Garrison, Noreen
• Reviewer in Management Services 2013 Edition, Roque
• Management Consultancy, 2015 Edition, Cabrera