Development of the Management Accounting System Methodology

Project Objective

Create a tool for managing company’s financial and economic activities, liquidity based on accounting, accumulation and processing of reliable information across all business operations and reporting required for managerial decision-making.

The main goal is to obtain reliable information on the following:

• Composition of costs (according to costs type) across company divisions and the company overall;
• Cost price of each business line and product type of the company;
• Company’s ability to generate profit, sources of profit or company losses;
• Effectiveness of internal processes within the company and the company’s divisions performance efficiency;
• financial stability (liquidity) of the company, assets amount and liability by their types;
• the amount of receivables and payables according to type of debts;
• inflow and outflow of cash which change balances on current accounts and at the company’s cash desks;
• Cash flows of the company;
• The sources of difference between company’s profit and generated cash flow;

Stages of the Project:

• Introduction to the Company:
  • Strategy;
  • Organizational structure;
  • Business processes.
• Development of financial accounting methodology:
  • Purposes of financial accounting;
  • Financial structure;
  • Forms and formats of management reports;
  • Managerial chart of accounts;
  • Classifiers, reference information (analytic characters);
  • Business transactions accounting schemes;
  • Methods of cost allocation and the formation of cost estimates;
  • Management reporting consolidation procedure;
  • Regulation processes.
• Drafting of a document “Regulation on the Management Accounting System”

Conduct Procedures:

• Preparation of a preliminary list of the documents requested from the Customer and analysis of these documents;
• Preparation of the list of questions for the Customer’s responders and analysis of the answers;
• Interviewing the manager and key personnel of the customer;
• Analysis of the information received;
• Confirmation and approval of the developed documents according to the management accounting methodology.

Project Outcomes:

• Formalized management accounting policy which is aligned with the current and long-term tasks of the company development;
• Structured list of works and required investments for the management accounting system automation.

Value for the Customer:

• Strengthening of business transparency and financial flows;
• Receipt of reliable information on all financial operations;
• Improvement of quality and operational efficiency of management decision taken at the operative management level;
• Effective control of financial activity risks;
• Assessment of personnel activity, middle ranking management and senior executives;
• Strengthening the company’s investment attractiveness.