Kế toán, kiểm toán - Chapter 1: Fundamental concepts

1Fundamental ConceptsCHAPTER 1PowerPoint Presentation by LuAnn BeanProfessor of AccountingFlorida Institute of Technology© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Managerial Accounting 11E Maher/Stickney/Weil2CHAPTER GOALThis chapter provides the groundwork for the book, including tying strategic cost analysis to the value chain.☼☼3FINANCIAL ACCOUNTING: DefinitionReports to users (shareholders, creditors, financial analysts, etc.) outside the organization.LO 14MANAGERIAL ACCOUNTING: DefinitionReports results of activities to insiders (managers, etc.).LO 15When a product is a “commodity” how do you compete to achieve/maintain profitability?Compete by differentiating yourself from competition. Focus on order fulfillment, cutting costs, etc.LO 26Can/should the financial or tax accounting systems be used for managerial accounting purposes?NO! The objectives and therefore the information available for decision making is different.LO 27FINANCIAL PROFESSIONALSFinancial VP: in charge of all accounting and finance Controller: manages cost and managerial accountingTreasurer: manages cash flows; raises cashCost accountants/managers: analyze, manage costsInternal audit: provides auditing, consulting servicesLO 38ETHICAL, REGULATORY FRAMEWORKStandard settingCost Accounting Standards Board sets cost accounting standards Professional organizationsInstitute of Management Accounts (IMA) sponsors professional certificationsCertificationsCertified Management Accountant (CMA)Certified Public Accountant (CPA)Canadian certificationsChartered Accountant (CA)Certified General Accountant (CGA)LO 49PREVENTING WHITE COLLAR CRIMESarbanes-Oxley ActPassed in the aftermath of the Enron scandalIncludesMaking CEOs and CFOs sign and accept responsibility for financial statementsMaking CEOs and CFOs responsible for the company’s system of internal controlsCreating the Public Company Accounting Oversight Board to oversee public auditorsLO 410TYPES OF COSTSOpportunity costsIs the forgone income from using an asset in its best alternativeDirect costsRelate directly to the cost object for which cost is to be measuredIndirect costsAre indirectly related to the cost of a cost objectVariable costsChange in total as the level of activity changesFixed costsDo not change in total with changes in the level of activityLO 511How do costs and expenses differ?LO 5While a cost is the sacrifice of resources, an expense is a “gone” asset.12EXHIBIT 1.3EXHIBIT 1.2Variable and fixed costs are presented separately for managerial purposes. LO 6Variable and fixed costs lumped together for financial purposes. 13ACTIVITY BASED MANAGEMENT (ABM): DefinitionExamines activities and their associated costs as a means of developing efficiencies and reducing non-value-added costs.LO 714What are “non-value-added” activities?LO 7Non-value-added activities are activities that can be eliminated without reducing a product’s service potential to the customer.What are “value-added” activities?Value-added activities are activities that increase a product’s service to the customer.15VALUE CHAIN: DefinitionDescribes a linked set of activities that increase the usefulness (value) of products/services of an organization.LO 716EXHIBIT 1.4LO 7Functions of the value chain help management identify value-added activities. 17How do strategic and tactical cost management decisions differ?LO 7Strategic decisions choose between production alternatives. Tactical decisions make a particular production alternative more cost efficient.18STRATEGY and VALUE CHAINStrategic cost analysis identifies parts of the value chain that generate most profits, enabling management to position their business at the best profit points.LO 719ECONOMIC DEPRECIATION: DefinitionMeasures decline in value of assets during a period using either sales value or replacement cost.LO 720COST OF CAPITAL: DefinitionIs the amount a firm could earn on its assets by putting them to their best alternative use.LO 721KEY DEVELOPMENTS IN MANAGERIAL ACCOUNTINGIntegrated information systemsTie managerial accounting, financial reporting, customer databases, supply chain management and other databases togetherExamples: ERPS, SAPWeb hostingAllows companies to focus on core competencies while outsourcing portions of information systemsJust-in-Time (JIT) and lean productionEliminate inventory between production departments and focus on quality and efficiencyLO 8Continued22KEY DEVELOPMENTS IN MANAGERIAL ACCOUNTING (cont.)Total quality management (TQM)Measures product reliability and service delivery as well as profitability while attempting excelling in all dimensionsTheory of constraints (TOC)Identifies the weakest part of the process chain (constraint) and attempts to improve itBenchmarking and continuous improvementBenchmarking: continuous process of measuring products, services, activities against best performance levels, engaging in continuous improvementFads LO 823INFORMATIONInformation is not free. Management must consider costs and benefits of information when designing an optimal accounting system.LO 924The Institute of Management Accountants promulgated the following standards of ethical conduct for management accountants.COMPETENCE - ongoing development of their knowledge and skills in preparing complete reports with relevant and reliable information.CONFIDENTIALITY – do not disclose confidential information acquired in the course of their work, except when authorized.INTEGRITY - Avoid actual or apparent conflicts of interest.OBJECTIVITY - Communicate information fairly and objectively. LO 1025RESOLUTION OF ETHICAL CONFLICTDiscuss such problems with the immediate superior except when it appears that the superior is involved, in which case the problem should be presented initially to the next higher managerial level.If the immediate superior is the chief executive officer or equivalent, the acceptable reviewing authority may be a group such as the audit committee, executive committee, board of directors, board of trustees, or owners.Clarify relevant concepts by confidential discussion with an objective advisor to obtain an understanding of possible courses of action.If the ethical conflict still exists after exhausting all levels of internal review, the management accountant may have no other recourse on significant matters than to resign from the organization and to submit an informative memorandum to an appropriate representative of the organization.LO 1026End of CHAPTER 1