Management Practices Traditional vs Modern Innovative

997 Words Mar 4th, 2014 4 Pages
Management Practices Traditional vs Modern Innovative

In last many years, few management accounting innovations has been developed. Managers have to make decision on a daily basis as well make decisions regarding the future and how to survive and grow in an energetic market place with ever growing uncertain circumstances. Traditional or modern management accounting system give relevant information to all levels of management, financial and other information to make decisions about planning, control of operations and identifying opportunities to add value.

The modern management accounting practice are typically different from that of traditional management accounting as they enable managers to make sound decisions to minimize cost as
…show more content…
Many managers have complexities visualizing the cause and result relationships that connect cost drivers to financial returns. Yet this is the key information needed to manage value, and education is regularly required to help managers recognize improved the reason and result relations that cause shareholder value.

Increasing functional area means that managers are ever more detached from shareholder values. Many managers are powerfully devoted to the association without being dedicated to the financial aim that drives it. Management accountants have a responsibility to take part in instilling financial control and assigning financial values to non-financial managers. One technique is to need operating managers (rather than accountants) to systematically organize and present the financial study of their industry unit.

At the similar occasion that the management accounting role must pay great amount of attention to the efficiency of its inner infrastructure processes, other demands are occurring. There is rising pressure to decrease on the whole cost of the finance function as a fraction of revenues. There are gradually more time consuming demands for more comprehensive external reporting. While these final goals are vital and must be achieved, setting the precedence there only boost the risk that internal accounting