Management Accounting

2024/2025

Учебный год

ENG

Обучение ведется на английском языке

8

Кредиты

Кто читает:

Международный институт экономики и финансов

Статус:

Курс по выбору

Когда читается:

3-й курс, 1-4 модуль

Преподаватель

Кондрахина Олеся Сергеевна

Course Syllabus

Abstract

The Management Accounting is a full year elective course for the 3-rd year ICEF students. The course is taught in English and finally examined by the University of London international programme or internally in ICEF. The course is focused on the process of making management decisions based on the financial and nonfinancial information about transactions and performance of an enterprise. This information can be collected, processed and presented in certain way to assist in this process. Among the topics covered are profitability decisions for different types of business activities or business units, pricing decisions, choosing from alternative options while deciding on additional costs or expenses or additional sales opportunities within limited production capacities. Special attention is given to the application of the cost accounting methods: marginal and absorption costing, job costing and process costing. Cost analysis has a significant influence on the pricing decisions and transfer prices. A large part of the course is devoted to the planning and budgeting process in the company as a management tool. The discussion of modern methods of performance management such as EVA, RI and Balanced Score Card brings a special value of the program. The course has a Principles of Accounting course as a prerequisite.

Learning Objectives

• The students get the knowledge about modern techniques used in the process of management accounting and analysis of costs in a business. They should be able to apply it in different business situations where they need to calculate costs for products or make a decision about a price. The students should understand major types of managerial decisions, that should be made in the process of formulating and implementing business strategy, they should have a general knowledge about major factors, influencing these decisions, and about major tools of planning, analysis and control of results, the usage of which significantly influences the success of the strategy implementation.

Expected Learning Outcomes

• Able to critically evaluate the proposed options for management decisions and develop and justify proposals for their improvement, taking into account the criteria of efficiency and risks Able to distinguish relevant and irrelevant information • Performs calculations for special pricing decisions • Performs calculations for make or buy decisions • Identifies the categories of sunk and opportunity costs • Applies an effective decision-making process to make decisions
• Describes the different purposes of transfer pricing • Describes and provide calculations of impacts on divisions of five transfer pricing methods: market-based, full cost, full cost/ marginal cost with mark-up, marginal cost +opportunity cost, negotiated price and dual pricing •Explains why market-based transfer price is advised in competitive market situations
• • Applies job and batch costing techniques • Applies overhead absorption and cost allocation methods using blanket and departmental rates • Evaluates the use of traditional costing methods in decision making • Calculates the full production cost using full absorption costing method
• • Describes the methods of determining the long term viability of the capital investment decisions, perform calculation and comment on the results • Discusses strengths and limitations of the different methods identified • Incorporates measures of uncertainty into analysis • Describes lifecycle costing, provide calculations relating to product lifecycle and explains its relevance to pricing policy
• • Describes the purpose and use of the balanced scorecard • Explains the performance measures used in four perspectives
• • Designs and perform calculations to prepare budgets • Links budgets and budgeting to a company’s strategy
• • Discuss the purpose and limitations of creating divisions • Design and evaluate divisional performance measurement systems • Devise and utilize performance measurement indicators
• • Distinguish between the challenges of short- and long-term pricing • Describe the target costing and perform calculations to determine target cost • Discuss the purpose and scope of customer profitability analysis
• • Explains and gives examples of value added and non-value added activities • Explains benchmarking, business process engineering, just in time and lean accounting • Compiles and explains the results of a cost of quality report
• • Explains the need for mix and yield variance • Calculates mix and yield variance • Explains how planning and operating variances help to interpret performance • Calculates planning and operating variances
• • Performs calculations to determine break-even point, margin of safety and output level to achieve a target profit, • Apply cost-volume-profit analysis to company producing multiple products
• • Prepares process accounts dealing with normal and abnormal loss • Calculates the value of finished goods and Work-in-progress (WIP) using weighted average and FIFO methods
• • Recommends how to use budgets for control and responsibility accounting • Designs flexible budgets and uses them for calculation of variances and management control • Produces flexed budgets and calculates variances that reconcile budgeted and actual profit
• • Solves resource allocation problems in situations of several capacity constraints and using linear programming and shadow pricing • Explains the purpose of using probability analysis, decision trees, maximin, maximax and regret criteria to help to Analyse uncertainty and solve problems relating to these issues
• • Understands and applies appropriate quantitative methods of cost behavior analysis • Understands the context in which learning curves occur and performs learning curve analysis
• • Understands the different steps in decision making, planning and control • Critically evaluates the uses of managerial accounting information for strategic decision making in various business contexts • Discusses the changing role of management accounting • Describes the value chain and indicate its strategic purpose
• •Explains the limitations of full cost-based pricing and transfer price methods which can be used to resolved conflicts between decision-making and performance evaluation •Discusses transfer pricing in international situations

Course Contents

• 1. Managerial Accounting. Costs classification.
• Topic 2. Full absorption costing methods
• Topic 3. Inventory and process costing and capacity management
• Topic 4. Activity based costing and activity based management
• Topic 6. Cost-Volume-Profit Analysis.
• Topic 7. Application of cost-volume-profit analysis
• Topic 8. Relevant information (costs and proceeds) for decision making.
• Topic 9. Decision making with constraints and uncertainty
• Topic 10. Theory and practice of cost-based pricing.
• Topic 12. Long-term decision making, capital budgeting and lifecycle costing.
• Topic 13. Strategic budgeting
• Topic 14. Budgeting and control
• Topic 15. Variance analysis – advance issues
• Topic 16. Divisional performance measurement systems
• Topic 17. Transfer pricing and its effect on performance management systems
• Topic 19. Cost management, JIT and environmental accounting
• Topic 18. Strategic performance management – the use of the non-financial performance measures

Assessment Elements

• Mock Test of of 2 module
• Mock Test of of 1 module
• Quiz on the lecture or class
• Home Assignments
• Class participation
• Mock Test of 3 module
• Final exam
  In order to get a passing grade for the course, the student must sit (all parts) of the examination.

Interim Assessment

• 2024/2025 4th module
  0.04 * Class participation + 0.02 * Class participation + 0.4 * Final exam + 0.06 * Home Assignments + 0.05 * Home Assignments + 0.11 * Mock Test of 3 module + 0.1 * Mock Test of of 1 module + 0.18 * Mock Test of of 2 module + 0.02 * Quiz on the lecture or class + 0.02 * Quiz on the lecture or class

Bibliography

Recommended Core Bibliography

• Management and cost accounting, Drury, C., 2015

Recommended Additional Bibliography

• Cost accounting : a managerial emphasis, Horngren, C. T., 2015

Authors

• KONDRAKHINA Olesia SERGEEVNA
• MALOFEEVA Tatiana NIKOLAEVNA