Part A: How does management accounting differ from that of financial accounting and what role does the management accountant play as a member of the management team?

• explain why managerial accounting applies to all types of industries (e.g., merchandising, manufacturing, non-financial services, financial services, government and other nonprofit entities). [6A-2]

• describe different ways in which the management accountant’s advice can help an entity to operate more effectively. [6A-3]

• analyze a company’s financial statements and/or management reports and identify several strengths and several weaknesses of the company from this analysis. [6A-4]

• discuss the need for and uses of a management control system and how accounting information facilitates control. [6B-2]

• explain how the operating philosophies of continuous improvement, total quality management and just-in-time manufacturing are used to manage optimal inventory levels; and discuss how the accounting function can be used to support their implementation. [6B-3]

• distinguish between fixed costs, variable costs, and mixed costs by categorizing various costs of an entity into these three categories. [7A-1]

• explain the usefulness and discuss the limitations of Cost-Volume-Profit (CVP) analysis as a decision making tool. [7A-2]

• read a CVP graph and explain the significance of the components illustrated. [7A-3]

• calculate fixed and variable costs, contribution margin, contribution margin ratio, break-even point in sales dollars and units, and target sales volume in dollars and units. [7A-4]

• calculate the effects of changes in sales volume, sales price, variable costs and/or fixed costs on company contribution margin, break-even point, and operating income for both multi-product and single-product situations. [7A-5]

• explain how pricing decisions are made, including transfer pricing decisions. [7A-6]

• identify the relevant costs in a make-or-buy decision and discuss both the qualitative and quantitative factors considered in this decision.[7A-7]

• identify and explain the long-term strategic decisions that management needs to make. [7B-1]

• calculate both return on investment (ROI) and residual income (RI) and explain how each method is used. [7B-2]

[8] Using Accounting Information To Analyze and Improve Operational Efficiency: How is accounting information used to analyze and improve efficiency in operating, financing, and administering the entity?

• explain the purposes of budgets and prepare both a simple operating budget and a simple cash budget. [8-1]

• discuss the limitations of budgets in managing organizations. [8-3]

• explain the relationship between accounting budgets and non-financial performance measures, e.g. cycle time, defect rate, and on-time delivery. [8-4]

• explain how the concept of responsibility accounting applies to cost centers, profit centers, and investment centers. [8-5]

• distinguish between controllable and non-controllable costs and discuss why the distinction is important. [8-6]

• explain how the concept of cost control is used to compare budgeted to actual amounts and to interpret any significant variances. [8-7]

[9] Processing Managerial Accounting Information: What is the importance and proper use of automated information processing in managerial accounting?

• identify alternative ways costs are tied to inventory and expense accounts (including the systematic and rational allocation associated with financial accounting). [9-1]

• trace the flow of costs in both a job order cost and process cost manufacturing system. [9-2]

• explain the causes and appropriate dispositions of over-applied and under-applied manufacturing overhead. [9-3]

• distinguish between a periodic and a perpetual inventory system for a merchandiser and a manufacturer. [9-4]

• describe the information benefits of maintaining a perpetual inventory. [9-5]

• distinguish between an activity-based cost accounting system and a traditional cost accounting system. [9-6]

THE CORE COMPETENCY MODEL

FINANCIAL ACCOUNTING OUTCOMES WITH CORE COMPETENCIES

MANAGERIAL ACCOUNTING OUTCOMES WITH CORE COMPETENCIES

ACTIVE LEARNING OUTCOMES WITH CORE COMPETENCIES

APPENDIX B
DEFINITIONS: OUTCOMES AND COMPETENCIES

APPENDIX C
CHARACTERISTICS OF WELL CONSTRUCTED COMPETENCIES

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