Management Accounting

Management accounting focuses on detailed reporting relationships to assist you to monitor and manage your operations. A management accounting will often include non financial information such as customer numbers, shop area and staff FTE.

A typical financial statement might list income at the top, with expenses listed from A-Z showing a net operating profit, similar to that below.

While the same figures re-arranged into a managerial accounting format would look like the following. You can see that the managerial format is very comprehensive and groups expenses int he categories, that can be manged on a regular basis such as wages and advertising. While others are more about monitoring such as rent and finance, which are more long term.
Notice that the net profit is different due to allocation of other costs such as staff leave and an area manager salary. From this example you can see the business is not as profitable as a traditional set of financials would have you believe.

In addition management accounts can incorporate ratios and metrics for comparison between other businesses such as customer and transaction numbers. One of the key advantages of Eagle is we can deliver both from the same set of figures.

So I hope this has been helpful if you’re interested in discussing this further; you know how to find me on the links on this page, but overall have a great day.