Figure 1: Figure representing Cost incurred in collection
(Source: As Created by Author)
2: As evident from the following case study that it is difficult to encounter the exact cost of calculating the disposal of waste from residents. One of the main challenges that is encountered for planning and controlling is the degree of uncertainty (Hill et al., 2014). The degree of uncertainty originates from the numerous variations of estimates and the foundation of such variations is the designs and logistics with rational relationships between the anticipated parties. The request of the councillor in discovering the correct cost do not appears to be realistic since cost tends to vary and does not remains identical (Carlsson et al., 2015).
Preparation of cost statement on certain occasions has been problematic because it does not assigns the fixed cost to each of the residential household during the process of waste collection (Bhimani et al., 2013). Therefore, the total amount of cost is difficult to ascertain with the projected amount of cost. Practically the estimation of cost is necessary for external reporting and at the time of preparing the exact cost, it is necessary in the disposal of waste. The auditors might run into the risk of not accepting the statement given that it does not complies with the generally accepted accounting principles (Breuer, et al., 2013). This can lead to problems for top executives who might favour using the variable cost approach for internal reporting.
3: Regarding the current situation, charging $500 for removal of waste the proposal of having a yearly collection of residential waste fee does not appears to be an appropriate measure of providing service. The residents might not support the idea of collecting rubbish by paying the fees of $500. The amount of fees that is charged by ABC City Council is not considered to be relevantsince the amount of fees charged by them is generally used for raising revenue.
Management accounting can be has been defined in several ways either by explaining its role or by demonstrating the goals and objectives. Generally, it is worth mentioning that the traditional explanation of the management accounting signifies that the management accountant is reliant on the indication of giving information to the managers. Management accountant can be defined as the profession, which comprises of taking part in the management decision-making procedure, managing performance system and providing expertise in the financial reporting (Balachandran et al., 2014). The profession of accounting has witnessed huge criticism in the current situation of monetary disorder. A large number of quarries have been bought forward regarding the role and position of management accountant in the current phase of globalization. The current essay is based on the exploration of role of management accountant together with the viewpoint people concerning the accountants in the modern age globalization (Hemmer &Labro, 2016).
In the current age of modernization, it is important to discover to what extent the management accountants have been able to contribute to more efficiently and crucially in the decision-making procedure. Management accountant have turned out to be an important part in the organisation process and management accountant actively becomes a strategic partner in the administration team of the company (Kaplan & Atkinson, 2015). It is outstanding to observe that management accountant have formed a noteworthy part of management team. A huge amount of focus is placed on communicating business related recommendations to the management whereas in past it has only been limited on providing information to the administration. In the age of modernization management accountant are commended with the responsibility of collaborating the organisation (Leotta et al., 2017). In addition to this, management accountant are concerned towards management of performance by introducing the practice of organisational decision making to manage the performance of the organisation.
As stated by (Luft, 2016) it has been mentioned earlier that the definition of management accountant explains the role of the management accountant by demonstrating their role and their objectives. The role of management accountant comprises of planning, directing, controlling and decision-making. The management accountant assist the higher-level management to meet the role of setting business objectives and goals by ascertaining the process of fulfilling the management accountant through specific implementation of action.
The management accountant are also responsible for looking after the regular business activities and keeping a track of the tactics in order to achieve the goals of the organisation. In addition to this, after defining the goals the management accountant directs its employees to achieve those goals (Malmi, 2016). Management accountant also discharge their responsibilities of exercising the control by assessing the outcomes of the business operations against the plans. Conversely, management accountant adjust the plans in order to keep the organisation pressing towards their goals by ensuring the efficiency and effectiveness of the company is preserved. Management accountant also imparts their responsibilities in the accounting department and additionally renders information to the controller that are answerable for general financial accounting and tax reporting (Novas et al., 2017).
In the modern age of business management accountant are found in all the levels of the organisation and functions in the cross-functional teams comprising of workforce representing several functions of organisation (Bodie, 2013). This consists of research and development production, marketing, distribution and consumer services. Due to rapid globalization, numerous companies have begun to move international by taking their trade across the border in a nationwide frontier. The international market is becoming exceedingly competitive and more severe than ever. To cope up with such strong competitions it calls for consciously placing the business units in context to where managerial accountant functions to compete against the rising competitions (Christ & Burritt, 2015). Globalization is creating a forceful impact on the theory of management accountant.
With increasing modernization, there is a huge increase in the transformation of information and business rivalry as well. Management accountant plays wide role in the organisation by not only rendering important business information but also takes a part in the business decision-making process. In order to pursue the objectives of the business management accountant continues to enlarge the business activities by focussing on reducing the waste so that it can create value by efficiently using the capital (Cooper et al., 2017). Hence, management accountant plays an important role in establishing and adding value to the company by managing the resources, actions and individuals to accomplish the goal of organisation.
In terms of ethics, it is the duty of the management accountant to behave ethically. There are specific requirement, whichis required to be followed with greater ethical standards in order to maintain better professional image. Management accountant are responsible for maintaining an appropriate degree of ethics by continuously developing facts and skills (Dekker, 2016). Management accountant endorses integrity by managing the conflict of interest through upholding regular communication with the business partners to avoid conflict of interest. Management accountant abstain from engaging in any kind of behaviour that would hamper them in carrying out the responsibilities ethically. They usually refrain from engaging in activities that disgrace their profession.
In agreement with the standards of ethics, management accountant might face with difficult situation in locating the unethical practice or solving the ethical conflict of interest (Drury, 2013). On facing any kind of ethical issue management account, undertake the policies of ethical standard to address and solve the conflicts. Management accountant converses the problems with the immediate supervisor and submits the issue to the higher level of management (Ellul et al., 2015). Conversely, the management accountant communicate the information independently by disclosing the noteworthy information that could reasonably be expected to persuade the intended users in understanding the reports.
From the above stated discussion, it is understood that management accountant adds value to the firm by help the higher-level management in the decision making process and planning of business activities. Furthermore, the study also highlights that management accountant brings about noteworthy information and participate in the day-to-day business activities. Management accountant also ensure that the ethical standards in the organisation is complied with prescribed policies and helps in solving conflict of interest among the business associates. Management accountant provide information to decision making which is precise, certain and timely rendered. They recognise and discuss the professional limitations and other restraints, which would prevent accountable decision or positive implementation of an activity.
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