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Strategic Managment Accounting

In: Business and Management

Submitted By sljeme
Words 4358
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Strategic management accounting
|by Mark Lee Inman | |
|01 Nov 1999 | |
|Strategic Management Accounting has been defined as "a form of management accounting in which emphasis is placed on information which|
|relates to factors external to the firm, as well as non-financial information and internally generated information." |
|Back in 1981, Ken Simmonds, probably the pioneer writer on the subject, developed the above definition. He saw it as the collection |
|of management accounting information about a business and its competitors for use in developing and monitoring the business strategy.|
|The emphasis was placed upon relative levels and trends in real costs and prices, volume, market share, cashflow and stewardship of |
|the resources available to the business. |
|More recently (1994) Professor Bromwich pointed out that adding the strategic perspective to traditional management accounting |
|required the role of accounting to extend in two directions. First, costs need to be integrated into strategy through strategic cost |
|analysis, and thus align costs with strategy. Secondly, to ascertain, albeit in a fairly general way, the cost structure of |
|competitors and to monitor the changes over time. In achieving this, Bromwich also sees two distinct approaches: |
|costing product attributes provided by the company’s products; |
|cost the functions in the value chain which are perceived as giving value to the...

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