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The Changing Nature of Management Accounting and the Emergence of HYBRID Accountants

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PRE-SESSIONAL 2010 PERIOD 4 PROJECT HAND-IN 2 PROJECT TUTOR: LYONS, EDWARD GROUP: EBS (C) 2 DATE: 10/09/2010- TO WHAT EXTENT HAS THE ROLE OF MANAGEMENT ACCOUNTING CHANGED ? Student name: IBRAHIM, NAIF Introduction: It has been widely discussed (Johnson & Kaplan) that management accounting has lost its relevance and the purpose which is designed for. Furthermore, the environment in which management accounting is practiced has been changed. Therefore inform managers unreliable data which they use to make their decisions. Management accounting are facing important role change, reducing routine tasks such as scorekeeping and experiencing proactive and exciting role (IMA, 1999). After the publication of Johnson and Kaplan (1987) many management accounting techniques have been produced. These techniques improved the role of management accountants to aid managers when they make their decisions. Giving them new ways to read the financial statements instead of just looking at the profits to use them to forecast. Organizations now have more strategic views in which they can plan for the future rather than just aiming to earn profits. The emergence of hybrid accountants who have accounting knowledge and understand management procedures. In this essay there will be a discussion of three main points. ...read more.


Furthermore, customer satisfaction have become focused by many organizations. Customers take availability of product variety as shown and might not essentially. Therefore customer satisfaction keep customers who they already have and new customers are a priority for the business. The second factor which influenced management accounting to change its nature is the advance in information technologies. One of these forward movements is the progress of database technology which provide the capacity to store a vast amount of information in accessible ways. Furthermore, the new database can analyse information in different ways. Information system that meets the needs of the various users which can be easily designed. In addition, the managers and most of people in the organization have PCs on their own desks. They use them to access the information which they need without supervision. Today with an appropriate software and small laptop computer can produce management accounts in couple of minutes and transmit them to the other side of the world in one click (Hopper, et al.2007, p: 120 ). The increase number of financial scandals in recent years has raised a question about failing role of the accounting and auditing profession (Hopper, et al. ...read more.


Conclusion: This essay has discussed three main points. Firstly, the history and development of management accounting. There were two historical revolutions which first one was between 1950 and 1980, and the second one was between 1980 and 1999. Secondly, factors which influenced management accounting to change its role. These factors appeared in recent decades which are globalization, advances in technology, accounting scandals and corporate trends. Finally, the new management accounting role. New techniques have emerged as a result of the factors which discussed. The role of management accounting has changed considerably over the last few decades.Management Accounting could be the wave of future for accounting. Because of new management techniques, accounting has become more vital to the organization as a whole. Some of the new ways of management include total quality management, just-in-time (JIT) production and purchasing methods and forecasting by using the financial statements. These various kinds of management styles pull accounting into the organization process more easily. Accounting has become a tangible part of the management process; therefore, the need of Management Accounting has grown in proportion to the new management styles. Accountants are now becoming a larger part of cross functional teams and are being used more in the decision making process. ...read more.

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