Management Accounting and Corporate Decision Making

Course goals

Learning objectives
At the end of the course the student is able to:

• Understand and explain the role of management accounting information in organizations;
• Understand and explain the role of management accountants in organizations;
• Understand and apply basic management accounting practices available for cost management and managerial decision making;

Content

Management Accounting and Corporate Decision Making (MACDM) is the branch of accounting that supplies the management of business entities and non-for-profit organizations with both financial and nonfinancial information to support their decision making. The focus of MACDM is on how management accounting systems and management accountants (sometimes called controllers or financial executives) can provide relevant and timely cost and revenue information, which is critical for corporate success. For example, management accounting information provides insights for successful management decisions regarding many corporate issues (like introducing a new product or service, maintaining existing product lines, the internal allocation of corporate resources and resizing divisions or departments and controlling costs).

Management Accounting with the current state-of-the-art IT is evolving gradually towards Business Intelligence (BI). Cost management requires understanding the cost structure of the firm, the advantages and disadvantages of different methods for cost calculation and cost allocation systems in use. Given the profusion of cost data within a firm, management does not need random data, but organized information to improve the quality of decision-making. The kind of information required depends on the nature of the decision, like one-order-only decisions, short-run or long-run price-setting decisions, or decisions on production planning and competitive pricing policy. Part of this work is done by management accountants. Their tasks, their professional and ethical standards, and how they use the organization’s internal information system to organize cost data will be the core in this course.

The topics covered in this course are, among others: transfer pricing, cost allocation, activity-based costing, designing performance indicators, budgeting and variance analysis. Basic models of data analytics for the management accountant are also integrated in this course.

Academic skills
This course focuses on the following academic skills:

Analytical skills

• Being able to solve problems (identifying the problem, devising a path towards the solution, following this path, verifying the outcome) in management accounting assignments.
• Being able to identify, interpret and critically evaluate the main line of reasoning for more complex problems.
• Being able to evaluate evidence in text and presentations for more complex problems.

Effort requirements

• Full attendance and active participation at all tutorials are expected.

However, the formal effort requirement is attending well-prepared at least 80% of the tutorials.

Information
LAS students, PPE students and minor Business Economics students can enrol via Osiris. The course is not open for other freemovers. 

In case online access is required for this course and you are not in the position to buy the access code, you are advised to contact the course coordinator for an alternative solution. Please note that access codes are not re-usable meaning that codes from second hand books do not work, as well as access codes from books with a different ISBN. Separate or spare codes are usually not available.