Managerial Accounting

The definition of Managerial Accounting, according to the Chartered Institute of Management Accounts (CIMA) is "the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of information used by management to plan, evaluate
and control within an entity and to assure appropriate use of and accountability for its resources.

Managerial accounting also comprises the preparation of financial reports for non management groups such as shareholders, creditors, regulatory agencies and tax authorities".

This can sometimes be referred to as billing management, due to the use of statistics during this process to control and report the financial health of a business/organisation to provide them with the basis in making informed business decisions that would allow them to be better equipped in their management and control functions.

Unlike financial accountancy information (which, for public companies, is public information), managerial accounting information is used within an organization and is usually confidential and its access available only to a select few, usually the management team and the people at the corporation who make the decisions. This accounting information includes company performance analysis and banking.

In relation to management accountancy, there are two recognised certificates; these are the Certified Management Accountant (CMA) and the Institute of Management Accountant (IMA) with the latter being an organisation based in the United Kingdom.

The importance of having a managerial accountant is that most corporations are healthier when they know to what extend they are making/losing money and only contributes to how well a company can develop and grow. By optimising all opportunities it will enable you to make informed commercial decisions for your business.