The above extension or explanation of the responsibility of a managerial accounatant mainly highlights the fact that a managerial accountant has responsibilities not only to the finance department of an organization but also the entire team that is working within the organization. Hence, along with the classification, calculation, assessment, understanding, and transferring all the relevant financial data, the managerial accountant is also responsible for helping the business team:
Customer satisfaction reports and assessments,
The balanced scorecard procedures for the overall sales,
In understanding the finances for the creation of a new good or service,
The factors that channel or guide the business activities metrics, and Research on superior functionality strategies (Johnson & Kaplan, 1987).
It is important to note here that the managerial accounting is different from the basic financial accounting because the latter only helps keeps a record of all financial expenditure or balance while the former helps the business design future financial plans (Johnson & Kaplan, 1987).
It is also very important to note here that while in the 1980s the overall importance of the managerial accounting section wasn't very high and it accounted for a very small part of the business, with the recent developments however, the managerial accounting sector has grown to be a significantly important process to control and channel an organization's internal activities through a methodology of strict and through monitoring which makes it an integral part of the management control theory of any organization.
Important breakthroughs in Managerial Accounting
Grenzplankostenrechnung (GPK)
Grenzplankostenrechnung (GPK), as the name suggest, is a German structure. This was developed in the 1950s and it primary task was measuring costs of an organization. The GPK, as it is commonly known, was constructed with the intention of giving the organization an efficient and precise categorization of all managerial costs induced and the methods or formulas that were used to conduct the calculations of the costs. The two most popular translations of Grenzplankostenrechnung are the Flexible Analytic Cost Planning and Accounting (Sharman, 2003) and the Marginal Planned Cost Accounting (Friedl, 2005). Most of the books use notably Flexible Plankostenrechnung und Deckungsbeitragsrechnung as the name for the GPK mechanism (Sharman, 2004; Kilger, 2002).
Hans George Plaut and Wolfgang Kilger were the creators of the concept and mechanism of GPK. The former, an automotive engineer, and the latter, an academic, coordinated towards a similar objective which was to design and implement a structure and process that would classify, present a precise and improved set of data on the overall costs of an organization (Sharman, 2004; Kilger, 2002).
Lean Accounting
The lean accounting or lean companies usually comprise of those companies that employ the Toyota Production System. The term was first introduced in the 1990s and became most popular recently in 2005-6. The lean accounting phenomenon mainly denotes that the conventional and old processes of accounting can only apply to businesses that have a mass production structure and does not necessarily apply with the efficiency to the business activities that exist during the production and marketing phases.
Resource Consumption Accounting (RCA)
The Resource Consumption Accounting (RCA) is another important concept within the managerial accounting domain that first surface in 2000. The universally accepted definition of RCA is that it is a flexible, all-encompassing and thorough structure that allows the administration to make decisions for the success of a project based on accurate and verifiable data. RCA underwent efficient developments in 2001 at the Consortium for Advanced Manufacturing-International (CAM-I). The concept was integrated as part of the Cost Management Section and was consistently polished and tried, for the...
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