Characteristics of Management Accounting · Decision-making system: The financial data provided by the management accounting, is helpful to the management in ...SkiptomaincontentSkiptoprimarysidebarDefinition:ManagementAccountingreferstotheapplicationofprofessionalknowledge,techniquesandconceptinpreparingtheaccountinginformationinsuchamanner,whichhelpsthemanagementoftheorganizationintheformulatingplansandpolicies,controllingtheoperationsoftheorganization,decisionmaking,optimisingtheuseofresources,disclosuretomanagementandsafeguardingassets.Infinerterms,managementaccountingcanbeunderstoodastheprocessingandpresentationofaccountingandeconomicdata,sothatitwouldhelpintheevaluatingperformanceofthemanagement,formulatingstrategies,makingcomparisons,budgeting,forecasting,etc.CharacteristicsofManagementAccountingDecision-makingsystem:Thefinancialdataprovidedbythemanagementaccounting,ishelpfultothemanagementinframingpoliciesandassistingthedaytodayoperations.Future-oriented:Managementaccountingisfuture-orientedasithelpsinplanninganddecidingthefuturecourseofaction.QualitativeandQuantitativeInformation:Inmanagementaccounting,qualitativeinformationrelatingtotheperformanceofthemanagersandotherstaffisalsoconsidered,alongwiththeotherfinancialdata.Nosetformat:Thereisnosetformatforthedisclosureoftheinformation.Managementaccountingusuallypresentsinformationintheformwhichiseasilyunderstandabletothemanagersandotherusers.Discretionaryactivity:Managementaccountingisnotcompulsorilyrequiredbythestatute.Indeed,managementaccountingisdoneaspertherequirementoftheorganizationandhence,itcanbedoneweekly,monthly,quarterly,half-yearly,etc.ManagementAccountingTechniquesThefollowingtoolsandtechniquesareusedinmanagement accountingforbetterdecisionmaking:FinancialPlanning:FinancialPlanningreferstotheactivityofdecidingbeforehand,whatistobedonetoreachthedesiredfinancialobjectives,i.e.itistheprocessofmanagingthefinancesoftheorganizationtogetthemaximumreturn.Itincludescashflowplanning,investmentplanning,taxpla