TU Accounting for Decision Making Trending in Management Paper
Comment and expand on a topic discussed in the videos and provide a real world example from the news or your own experience.
7 Trends in Management Accounting – Trend 4. Authored by: IMA. Located at: License: All Rights Reserved. License Terms: Standard YouTube License
7 Trends in Management Accounting –
. Authored by: IMA. Located at: License: All Rights Reserved. License Terms: Standard YouTube License
Post 1: Brian
This module, I connected with the video discussing the different approaches to accounting methods in an organization. I’m a project manager in my organization, an while there are several tiers of financial and management accounting, they are very different based upon the scope of a particular role in the organization. District leadership is keenly aware of P&L statements, shareholder impact, and setting/maintaining annual performance budgets for the various offices in its territory. At the project management level, I care mostly about what I’m graded on, and how to improve. Namely, maintaining profit margin, preventing slippage/margin erosion, and driving a high level of customer satisfaction to drive continued/future business in the organization. A key takeaway for me is the awareness of how leadership above me prioritizes management accounting, and how to adapt to their styles when climbing the next run of corporate ascension.
7 Trends in Management Accounting – Trend 5. Authored by: IMA. Located at: License: All Rights Reserved. License Terms: Standard YouTube License
Post 2: Rafael
Over the last ten years, business intelligence has gone through an innovative and revolutionary transformation within the global business world. Throughout the globe, businesses of all sizes and forms have experienced an explosion of growth within produced data. Practically every sort of company operates within cloud-based software. Finicky reports and spreadsheets from yesteryear have transformed into highly technical dashboards containing every and any sort discerning and prospective types of data a company is able to produce. Indeed, the surge and intensification of data throughout all forums and platforms has led to a plethora of analytic means designed to corral and make sense of all that information that is continuously produced and generated faster than it can be understood and actioned by any of these businesses and corporations. Yet, the analytical aspects within these respective duties and responsibilities are no longer designed just for the privileged analysts within an organization to decipher and figure out. Undeniably, every employee within the business world has indeed become analysts in their own ways; and carry the ‘unwritten’ responsibilities to be just as good and fundamentally sound when being able to provide and analyze data as well as their analytical professionals. But so then raises the concerns if all data is actually usable data? If not, is there a way to distinguish actionable and reliable data from the sheer volume of all data? How can this be done, and who ultimately bears the brunt of making this happen in order to effectively produce key decision-making results?
In 2018, the continuous trends within business analytics expanded so greatly to the point that a series of errors and low-quality reports were being reported as an effect for corporations not having the abilities to keep up with the ever-growing mountain of data within their respective organizations. The ability to simply gather and sort the different variants of data was just not present the majority of times; therefore, proving to be an extremely difficult task in the name of maintenance and organization.
Because of these critical deficiencies, a survey facilitated by the Business Application Research Center in 2018 revealed Data Quality Management (DQM) as the most important analytical trend for 2019 and beyond. The findings of the survey revealed the importance of not only gathering as much available information as remotely possible, but to have the ability to cycle through and distinguish the quality and contextual data from all the data, and to utilize this data to serve as the main focus for the successful future of business intelligence. These findings have placed a critical priority when it comes to the rise of master data management within the overall strategy of business intelligence within an organization.
Today’s businesses understand the robust implications and consequences when it comes to DQM and how it is utilized effectively. Most organizations understand the roles and impacts DQM play within the decision-making process, therefore ensuring that DQM Standard Operating Procedures (SOPs) and policies are in place within all respective departments which deal with high volume data.
Successful DQM SOPs and policies ensure to outline the acquisition of data, implementation of advanced data processes, and effective distribution of data and managing oversight data. How data is collected, implemented, sorted, disseminated, and utilized plays such a huge factor moving forward with business analytics and intelligence. From a society point of view, the growing concerns of business analytics are mainly within the utilization and privacy laws within the realm of social media.
In the recent season of the hit Netflix series Black Mirror, the second episode titled ‘Smithereens’ tackles the immensely, yet critical side of how analytics and data information on the main villainous individual character of the storyline is utilized as opposed to how much is known by the respective police force and government agency. Without spoiling too much of the episode for those who may not have seen it, the individual character in question is identified and large sums of information is shared on the individual by a major social media corporation to the local policing authorities involving the amount of information, data, and analytics of his social media behavior and traits. The amount of data which the social media corporation had on the individual superseded even that of the database of a local police force, and also of a government agency. The social media platform in fact had so much information dealing with the behaviors, traits, characteristics, and mood of the character that they became the eyes and ears of the local authorities.
This sort of analytical work clearly speaks volumes in terms of privacy laws and potentially copyright statuses, but it also speaks immensely to the sheer volume of DQM which the social media corporation exercised in order to quickly assist local authorities in their quest to diffuse a hostile situation. Simply put, DQM is just one step within the analytical food chain, yet I believe it to be the most critical aspect when it comes to feeding the rest of that stated food chain. Without proper management and filtering, analytical processes can waste an immense amount of time dealing with low-quality, low-density information. Or, through proper SOPs within DQM, analytical processes can thrive and serve as the main focus for the successful future of business intelligence for years to come.
It is widely understood that to succeed within the world of business and finance, one must be able to speak the universal language of accounting. More than ever in this day in age, the language of accounting has quickly been recognized as the common dialect worldwide in relations to corporate finance and business decision-making.
Accounting is the basis and foundation for all that is functional when it comes to the world of business. Depending on what line of business an organization falls in, corporate business regardless performs many different functions and transactions in line with the financial world. Understanding how accounting contributes to these functions and transactions is essentially understanding how the world of business revolves globally.
Speaking in the language of accounting is imperative when it comes to understanding how routine business transactions occur, as all transactions are recorded within the four core financial statements. Therefore, it is imperative for corporate executives and leaders of all types to learn and understand how to read and interpret financial and accounting terms as these terms are widely used around the world within the language of finance.
Accounting is quickly becoming the global business language because the format for accounting is used everywhere globally in every organization imaginable. No matter the type of business or location, being able to interpret financial data and information presented within accounting documents can showcase how a company stands when it comes to current operations, finances, and potential business decisions for future operations and investment. Regardless of how one dresses it, it is important to understand that numbers are universal across the world and they work the same way regardless where one is located, or what they do. Therefore, to understand the fundamentals of accounting is imperative to succeed in today’s business and financial world.
Booker, C. (Writer), & Hawes, J. (Director). (2019). Smithereens [Television Series Episode].
In Baptiste, M. (Producer), Black Mirror. London, United Kingdom: Edemol Shine UK
Do you speak the language of business? (2013). Wharton – University of Pennsylvania.
Durcevic, S. (2018). Top 10 analytics and business intelligence trends for 2019. Datapine.
Natter, E. (2018). Why is accounting often referred to as the language of business? Chron.
Toma, M., & Leuca, S. (2018). Approaches to providing security in data quality management.
Research and Science Today, (2), 42-48. Retrieved from ProQuest Database, Trident
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Garrison, Noreen and Brewer (2010) explain the transfer price as the price charged for goods and services of one segment of a company to another segment of the same company. The reason for the importance of transfer pricing is based on the performance evaluation of a division or segment of the company and the impact on their profit, ROI, or residual income. A price has to be established for transfer so the division which produces the good or service will receive some form of credit for what was provided. Companies which would use such a scenario may be vertically integrated oil company, for example; Exxon Mobil, Royal Dutch Shell, Chevron, BP, Total, ENI and Statoil. Each of the aforementioned companies is involved in the exploration and production for oil and natural gas, as well as other commodities. This is considered the upstream side. The downstream side is what occurs after the oil, gas and other minerals are extracted. Considering crude oil, the produced products are acquired by the crude trading side for use as feedstocks into the refineries. The refineries refine the crude oil into many products such as kerosene, diesel, gasoline, and lubricants. The refineries sell the products to the retail outlets, i.e. service stations. So, there is a transfer price involved with the selling of crude oil to the refineries. There is a transfer price involved with the sale of refined products to the marketing side. Each division of the company wants to buy the cheapest and sell the highest. This is where the problems begin to show up.
Garrison, R. H., Noreen, E. W., & Brewer, P. C. (2010). Segment reporting, decentralization, and the balanced scorecard. In Managerial accounting (13th ed., pp. 507-577). New York, NY: McGraw-Hill/Irwin.