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Management Accounting and Decision Making - Assignment Example

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The goal of this assignment "Management Accounting and Decision Making" is to evaluate the relevance of strategic management accounting methods to contemporary business organizations. Furthermore, the writer elaborates on the benefits of accounting theories to company administration…
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Management Accounting and Decision Making
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Download file to see previous pages The theoretical framework behind strategic management accounting is also applicable to organizations from all sectors. More advances could be made by additional development, especially extending its role to that of scanning internal policies for sustaining successful changes in organizations and providing a boundary between such intra-organizational changes and extra-organizational controls. Strategic management accounting is being deployed by organizations as a mechanism for the management of its confines with the society within which it operates. Hence, strategic management accounting methods, such as value chain analysis, life-cycle costing, attribute costing, benchmarking and others, have restored the lost relevance of management accounting to a great degree. The theoretical framework for strategic management accounting - the theory of contestable markets is regarded as one of the key economic ideas, affecting most of the public policy in the last few decades. The essence of contestable market theory is that the effectiveness of a given business is best achieved by the threat of potential newcomers into that market. In these circumstances, there is clearly a potential role for the strategic management accounting approach in monitoring and detecting market changes, linked to a careful analysis of cost structures to enable organizations to compete successfully in these near market places. From this, we can conclude that strategic management accounting is relevant to all kinds of organizations as they address the agenda for change which confronts them. The theory of strategic management accounting has relevance for the ideas on change in organizations too. In particular, this expansion of strategic management accounting would facilitate a move away from static, functional approaches to management accounting practices.  ...Download file to see next pagesRead More
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