Home  Journals  International Accounting  23(365) - 2015 June

Selecting an actual data source to generate management reporting

Available online: 19 July 2015

Subject Heading: Managerial accounting

JEL Classification: 

Pages: 27-34

While compiling management reporting, the choice of the actual data source becomes a primary issue. Any source is selected depending on the significance of different parameters that help choose a certain option for generating the actual data. This article considers the background, advantages and disadvantages of options for collecting actual data for management accounting purposes. We consider operational accounts, management or accounting records data. The premises for applying management accounting data are differences in management and financial accounting, i.e. record keeping principles, analytics, methods for forming indicators. As for the financial accounting, the premises include full recognition of business transactions in accounting records, lack of the staff. The premises and advantages are the basis for determining the main parameters for selecting sources of actual data. The paper compares options of actual data sources on the basis of our experience. Each of the considered parameters may have an advantage in favor of selecting a certain option of actual data formation for purposes of management accounting. However, if one parameter is more significant in choosing an option, with the second criterion contradicting the selected option, the company should implement changes (for example, organizational changes or changes in the accounting methodology). In any case, each company individually determines the actual data source to generate management reporting. At the same time, the assessment of these parameters separately for each company is intended to deliberately and reasonably choose an accounting option.

Keywords: management accounting, operational accounting, actual data, collection, accounting

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ISSN 2311-9381 (Online)
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