Duncan
WILLIAMSON

Introduction to Management Accounting

Simple Definition of Management Accounting

How do we define management accounting, then? Well, there are simple definitions and there are complicated definitions. Simply, management accounting can be defined as

the provision of information required by management for planning, organising and control

Management accounting is concerned with information for management purposes: it is internal information for the organisation itself and is very rarely made public, unlike financial accounting information.

As we will see with the more complex definition of management accounting, this definition attempts to concentrate on that part of management accounting that is concerned with the accumulation of product and service costs, the preparation of statements relating to materials, labour and overheads; standard costs, budgeting and management accounting for decision making. Consequently, we will not be concerned too much with controllership, audit and the treasurer's function. We will need to discuss corporate planning to some extent as we look at standard costs and budgeting.

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Duncan Williamson
3 March 2003