Management accounting combines accounting, finance and management with the leading edge techniques needed to achieve successful businesses.
It includes the preparation of management reports using accurate and current financial data in order to aid decisions both long term and short term. This allows you to make informed management decisions about the company.
Reports include data such as:-
- Actual expenditure versus budget, showing variance against budget and comparison against prior year.
- Cash flow update e.g. if obligations can be met when they are due.
- Comparison of your business to the industry and competitors.
Management accountants will advise clients on the financial implications of a project, explain the financial consequences of business decisions as well as help to formulate a business strategy. A CIMA qualified management accountant will have strong strategic business and management skills including:-
- Analysis:- Analysing the strengths and weaknesses of the company and using it to make business decisions.
- Strategy:- Building a plan to achieve business goals envisioned for the next 1-3 years.
- Risk:- Identifying risk areas, such as low cash or high amount of debtors, and managing them.
- Planning:- Using your plan to develop budgets and a cash flow statement.
- Communication:- Working closely with the client by having regular meetings throughout the year, explaining in a way understandable to non-financial clients.