Management accounting is concerned with the provisions and use of accounting information to managers within organisations, to provide them with the basis to make informed business decisions that will allow them to be better equipped in their management and control functions.

In contrast to financial accountancy information, management accounting information is:

• Forward-looking, instead of historical;
• Model based with a degree of abstraction to support decision making generically, instead of case based;
• Designed and intended for use by managers within the organization, instead of being intended for use by shareholders, creditors, and public regulators;
• Usually confidential and used by management, instead of publicly reported;
• Computed by reference to the needs of managers, often using management information systems, instead of by reference to general financial accounting standards.

Free study aids

See all the web pages listed in the menu on the right of the page for a variety of explainations and examples of cost and management accounting.

Question practice is an essential part of any effective learning and studying approach. This free resource pack contains questions and worked answers on the theme of cost and management accounting and includes topics such as cost behaviour; the nature of management accounting; High Low method; overhead application; absorption and marginal costing income statements; marginal & relevant costing for decision making; cash budgeting; standard costing and variance analysis and activity based costing. Supporting notes on costs and management accounting can be found in our training and development area.