Management accounting has reflected a significant role in the business lives of accountants, semi-skilled and crude accountants and the accounting sector at large. There is a need to constantly develop the practice of this aspect of accounting as it has posed as a challenge towards technology enhancement over decades. Many authors have described management accounting in various ways that regards it as a controversial topic.
I would describe Management Accounting as a fundamental approach to making business decisions, controlling and planning operations as well as coordinating the managerial process. Frontline managers have reflected the use of basic accounting principles such as costing, budgeting and stock valuation, to mention a few. Management Accounting can be traced back to as fart aback as the With reference to Burns and Scapens [1] journal published in the year 2000 which discussed the sense of incapability and impertinence of management accounting and how the non-technical accountants and developed professional bodies contribute to this growth. This essay seeks to review and explain the literature of the reversible nature and importance of Management Accountant since the year 2000 and also to observe other authors arguments and claims that support this manifest.
Major Findings from the given article
Below are the various claims and testifications from the article published by the authors above;
There are different techniques of accounting-Traditional, ABC (i.e. Activity Based Costing) and Strategic Management Accounting
New proactive, willingful, smart, challenging accountants have surfaced over the years which has made the accounting process increasingly operational.
Further to that John and Scapens also evaluated certain factors that suggest to the constructive alteration of Management Accounting. I have summarised them as follows:
Global economic competitive situation of the 1990s; If managers and accountants sense or foresee a strong competition they intiate a greater emphasis on the market.
Technology advancement which has laid massive effect on communication inflows and outflows thereby making work-related processes much more easier.
Organization structure, i.e the creation of mergers and acquisitions in the mid 1990s (1970-1990). Organization started to sell their goods and services to specialist firms in order to outsource activities or departments that they were not capable of handling. (this can also be referred to as the theory of make or buy).
THE SCOPE OF MANAGEMENT ACCOUNTANTS
This part of the essay focuses on my major observations and opinions supporting the claim that Management Accountants have exceeded the limitations that their role offers in the sense that their character has outstretched its rationale towards the context of the theory of accounting.
Feeney and Pierce (2007) denotes that the role of an MA can be categorized into decision making and the operation of management and controling which is mostly recognized in the budgeting process. This explains that orthodox doctrines laid by accounting professionals are well carried out by simple and skilled accountants,which has made the service market to be more competitive and aggressive.
It has been advised that the traditional role of the management accountant is threatened by the rolling out of more advanced management accounting technique and fronting competition from other management who are acting same role of management accountants. Pierce`s article (2001) says the changing role of management accounting specified that most of the work traditionally carried out his management accountants could have done it as easily as professional. Lots of Theorists have noted that lack of relating clarity and limited details of making routine clears.
Management accountant now plays a critical role in accounting by providing data and information business. Burns and Scapens (2000) stated that the environment in which management accountants training seems to have changed. Definitely with the advent of new accounting organisation corporate rearrangements changes in regulation and legislature a strengthening competitive market and advancements in information technology systems one cannot dispute that the environment has not changed. Such changes are considered the drivers in the change of the role of the management accountants, and Burns and Viavio (2003) notify us that such broad change implies a need for management accounting to change as well, advanced information technology system, such as enterprises resource planning, i e management accounting is now becoming generally day to day running activities in many organisation.
Scapens and Jazayeri (2003) conducts training focused in the influence of enterprises resource planning on the duty of Management Accountants. Scapens and Jazayeri (2003) suggested 4 keys in the areas of changes; these are - directors with accounting knowledge, elimination of routine of the jobs, additional information, and more information role for the management accountants. With the agreement of Caglio (2003) whom as well acknowledged that enterprises resource planning has transformed the role of the management accountant. like advances information technology systems has likewise made it possible for routine accounting responsibilities to be done by the organisation managers.
The advanced information technology schemes is now playing the significant position in management accountant role mentioned to in the article as the hybridization of the roles (Feeney and Pierce, 2003; Caglio, 2003). The characteristic of hybridization refers to the contemporary role of the management accountant. One who plays the vital role in management decision making and it is too strategy know but is still involve in the organisation. The new computerised routine has really changed the accounting responsibilities it has allowed management accountants to make sure they give extra time to give support to the organisation manager and before it doesn't happen like that way, role of management accountant has really changed.
The role of management accountant has really changed since the article was published in 2000, management accountant maintains management decisions, controlling and monitoring. The role of management accountant has been there to help managers to provide appropriate information used in the business. They are mostly being called upon to help in quality management decision making, they also involve in non financial aspect of the business such as a planner, facilitator for management. Information technology is more comparative than just atomisation of business possesses information technology has essentially changed the way business is done. In the 1990s, management accountant seemed to be horizon but now the organisation is growing speedily growth in the progress. The task for management accountants is to look for a very good understanding about the technology available in the business organisation. In many organisations management accountants is now playing very important role in the implementation and success of the enterprises resource planning system.
Management accountants have now had another significant success factor for enterprises resource planning procedures. The management accountants were actively participated through the procedures process, a meaningful change in the task executed by management accountants take place. These organisations likewise hold a high volume of success in the enterprise resource planning procedures. The organisations are connected with the management accountants In the second stage of the procedures had a moderate level of enterprise resource planning procedures success, the management accountants experienced moderate changes in their role. They are two cases of organisation that didn't involve the management accounts in the enterprises resource planning resource procedures, there was limited perceived success of the enterprise resource planning system and the management accountants continue to with their work as they had prior to the enterprise resource planning procedures. Management accountants have developed different kind of skills in appraising cost, benefit and contextual matters of different kind of client that supply systems and supply chains and report correctly.
Management accountants of today and management accounting is not just only the distance future is changing into financial and planned. The ordered skills and set them to makes the plentifully clear. Intimations for management accountants are totally clear. The studies of many stakeholders in different type of countries all offer a mutual situation. Skill in demand is technological, strategic, analytical, leadership and communication based skills. The management accountants' skills focussed upon advising and leading business development. They signal a role change from financial information support role to management advisor and decision making etc.
Lastly, the role of hybridization in accounting firms have also be identified. However, it is of immense necessity that this issue is brought forward because professional bodies have become susceptible to the technicalities of unskilled accountants. There really isn't a basic requirement for formal training of the former, this type of 'accountants' just breed into any form of obligations, duties or responsibilities and it advances with time. Although the Management accountants decisions or plans contribute and collaborate to the strategic fines and threshold of an organization, the indulgence of "hybrids" cannot be overemphasized.
Bryne and Pierce(2012) concluded that hybrids are now seen as business partners and in order for management accountants to desire satisfaction from achieving this role, they have to outstrip anticipated quests in whatever form.
Conclusion
Over the last few years that the article called the Changing Nature of Management Accounting and the Emergence of Hybrid Accountant was written the role of management accountant has rapidly change, management accounting is not just only the distance future is changing into financial and planned. Management accountant now plays a critical role in accounting by providing data and information business. Burns and Scapens (2000) stated that the environment in which management accountants training seems to have changed. Definitely with the advent of new accounting organisation corporate rearrangements changes in regulation and legislature a strengthening competitive market and advancements in information technology systems one cannot dispute that the environment has not changed. Many researchers have argued that the management accounts role is moving from their traditional role in the business organisation as a scorekeeper and controller into a further strategy. Before management accountant use to stay at the back room dealing with figures but now the role of management have move to different level, Management accountant now plays a critical role in accounting by providing data and information business, planning, decision making and all that. The advanced information technology schemes is now playing the significant position in management accountant role mentioned to in the article as the hybridization of the roles. Management accountant is involve in the implementation of enterprises resource planning
