Management Accounting Essay Example | Topics and Well Written Essays - 2500 words - 2

Management Accounting - Essay exampleGenerally, control governing bodys guide the methods of coordination, resource allocation, motivation, performance measurement, and communication. The major purposes of a management control systems areThe folksy management control system is the one where managers encounter a non-routine decision making problem or a problem that has non been encountered before and requires new information. In such a situation managers, may informally call subordinate and extract information in a relaxed manner.In the absence of a proper management control systems, employees will non be aware of the roles that they are supposed to do. there will be no information on the resources and time that is available for each activity. The employees will not be aware of the plans of the activities that are supposed to be done. A well-designed management system influences the behaviour of the employees in such as way that it is congruent with the finishs and objectives of the organization. Often employees have individual goals that might be not synchronous with the organizational goals. A good management control system makes it sure that the actions taken by people to achieve their own goals also help in the achievement of organizational goals. This aspect which is called goal congruence in accounting terms implies that the goals of the subordinates and the managers are coherent. A poor management control system will lead to confusion in the minds of employees as regards to the strategy and the goals of the organizations. Often messages from different sources may controvert each other. A good management control system will set out rules and derogate the possibility of such events.Management control systems and performance management are very closely cerebrate with each other. Often the performance management systems are a part of the management control system for the organization. A poor performance management system has a lot of effects on t he organization that are not