Planning and Controlling

Structural categories

Project planning

Management Accounting / management Reporting /Controlling

Management Accounting/Reporting

Management accounting is concerned with the provisions and use of accounting information to managers within organizations, 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: usually confidential and used by management, instead of publicly reported; forward-looking, instead of historical; pragmatically computed using extensive management information systems and internal controls, instead of complying with accounting standards.

As such Management Accounting is "the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of information used by management to plan, evaluate and control within an entity and to assure appropriate use of and accountability for its Resource.

Distinction to controlling

The distinction between management Accounting and Controlling is difficult and in many companies the term is used interchangeably.

However in companies where both term and respective departments exist, the focus of Management accounting is very much on information for management versus controlling being information provided to operational middle management.

Very often Management Accounting forms the interface between Management and Accounting, Management and the operation commercial controllers and Management and the Company controllers.



Management accounting ranges from Controlling (as described in the section controlling) to the dedicated interface for management which becomes the focus when a separate controlling department exists.

In certain circumstances and very often in big companies, a dedicated team of people providing executive summaries as well as detailed explanations to top managers can be a valuable investment as efficient decisions might be easily hindered by too much information on a too low level.

 As such the regular accounting output or controlling output for that matter would not be suitable for executive decision making. Hence a balanced executive reporting is in such situations pertinent.

It is easily to be seen that the establishment of such a management reporting is everything else then straight forward an in most cases very much dependent on executive personnel's way of working.

Hence a flexible system needs to be in place, which is able not only to provide executive suitable information, but is also able to gear the granulation and focus of reporting as an integral part of their operational activities.

In order not to get sidetracked it is advisable to get external support coaching you through the establishment process.

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