Can Big Data Analytics Be Used By Management Accountants?

1830 Words Nov 22nd, 2015 8 Pages
Can big data analytics be used by management accountants to provide a better understanding of a business’s position and outlook?
Abstract
This paper discuses traditional accounting methods using structured data. It introduces unstructured data that makes up the majority of big data and looks at various types of unstructured data. It looks at traditional storage of data and how data lakes are used for storing unstructured big data. It moves on to show how analysing big data can be used to highlight trends rather than causes. It also highlights some of the pitfalls of not being aware of the relevance of the data being analysed. Various examples of how big data analytics can be of use in the compiling of management accounts are discussed. The paper concludes that big data analytics is the key to unlocking a company’s potential for taking advantage of predictive metrics but that care should be taken as to how data is analysed and how the results are interpreted.

Introduction
According to the Institute of Management Accountants traditional management accounts are prepared for “the process of identification, measurement, accumulation, analysis, preparation, interpretation, and communication of financial information used by management to plan, evaluate, and control an organization and to assure appropriate use of and accountability for its resources.” (Institute of Management Accountants, 2015)
These accounts are compiled using historical facts about a business usually obtained…
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