Advantages Of Managerial Accounting

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I. The company’s management accounting has to be recorded as well along with the financial details.
The purpose of managerial accounting is to provide useful information to internal managers to help them make decisions that arise as they manage people, projects, products, company divisions or segments of the business.
-Advantages of management accounting:
1. Helps managers in making decisions within the company for the benefit of the company by making short term reports which comprise of information pertaining to only the decision to be taken at the moment. Based on this, management reports can be prepared daily or once in a while depending on the requirements of the decision. Therefore, managerial accounting helps in increasing profitability
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Perspective of user This is used by external users of information such as stock holders, material suppliers, government, investors, etc. This is used by internal users of information such as managers, CEO, employees, etc.
2. Types of reports These accounting statements are classified financial statements prepared according to GAAP or IFRS standards These reports are non GAAP and do not pertain to any specified standards to meet the requirements of insiders such as short term or temporary budgets or performance evaluations or cost reports, etc.

3. Time They are historical, i.e. long term and preserve able for future needs or assessments arising in the organisation. They are highly short term and quality is compromised to quantity of the report for making important decisions. Format Financial accounting is highly standardised and have to follow the international format or any regional specified format. Eg, the balance sheet, statement of profit and loss, etc. Managerial accounting does not have to follow a specific format to meet the needs of insiders which is mostly for decision making
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