Study Notes management accounting acca f2

 
M
ANAGEMENT 
I
NFORMATION 
(MI)
•
Information required by the managers for the purpose of planning, control and decision making 
•
Information given to people who run the business 
•
Information required varies according to responsibilities. For example a supervisor at a factory would 
require a daily output report. A sales manager would require a weekly sales report etc. 
•
Information may be used for pricing, valuation of stock, determining profitability, deciding on purchase 
of capital assets (fixed assets) etc. 
 
Types of Management Information
Most organisations require the following types of Management information 
➢
Financial information
▪ Measured in terms of money 
▪ For example sales of $10,000 in May 
➢
Non-financial information
▪ Not measured in terms of money.

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F2 Management Accounting
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▪ For example customer satisfaction, trends, quality 
➢
Combination of financial and non-financial information
▪ Increase sales by $2,000 due to good quality of product 
 
PURPOSE OF MANAGEMENT INFORMATION
Major purpose of management information is
▪ Planning
▪ Control 
▪ Decision-making 
Decision making in a broader concept and the planning stage and control stage also includes decision 
making in it
➢
Planning: 
Planning involves the establishment of goals and objectives. It also involves selecting 
appropriate strategies to achieve that objective. 
▪ The management has to plan and manage resources that will be required to achieve the 
objectives. Plan what resources are required and how they will be used. 
▪ Resources can be monetary (like cash required for business) or human resources (like 
employees) 
▪ Managing resources means how much would be spending on which project, how many people 
will be working on that project etc.