1. F2/FMA Management Accounting ACCA Knowledge LevelFIA Level

2. Unit 1 Information for Management Data is a scientific term for facts, figures,information and processing. Data are the raw materials for data processing. Information is data that have been processed insuch a way as to be meaningful to the personwho receives it. Information is anything that iscommunicated. 3. Data Data is the plural for datum. Think of data as a raw material. It needs to beprocessed before it can be turned into anythinguseful. Hence the need for data processing. Datacomes in many form numbers, words andsymbols. Data relates to transactions, events andfacts. On its own, it is not very useful. Examples of data include the following: The number of CAT graduates each year. The annual sales turnover of a college. 4. Information Information is data that has been processed in such away that it is meaningful to the person who receives it.It is sometimes known as processed data. Note that it is not enough for data simply to beprocessed. It must also be meaningful to someone,otherwise why bother processing it? Management information can therefore be describedas information that is given to the people who are incharge of running a business. Managementinformation can be as follows: Financial information (measured in monetary terms) Non-financial information (not measured inmonetary terms) 5. The Purpose of Management Information 6. The role of management 7. Managers of all levels within anorganisation take decisions 8. Qualities of Good Information 9. Reporting information requires the active co-operation of the following groups: 10. Sources of Information 11. Internal information Internal information means the inside working of any person/company/organization/business. Usually such information is confidential and not for public. Most companies have policies regarding the release of information. 12. External information External information means any information available for general public. It is not from the organisation. 13. Categories of Information Most of the companies accounting information willbe keyed into a computerised accounting system. Therefore, a coding structure (chart of accounts)is important. For example: Different business units Costs Income Different products and raw materials 14. Comparison of ManagementAccounting and Financial Accounting 15. Unit 2 Cost units and costclassification 16. Cost centres 17. Cost objects Cost object for example a product, service, centre, activity, customer or distribution channel in relation to which costs are ascertained. (CIMA Terminology) 18. Classification of costs 19. Elements of cost 20. Cost behaviour Cost behaviour is variability of input costs with activity undertaken. (CIMA Terminology) Fixed cost -Fixed cost is a cost incurred for an accounting period, that, within certain output or turnover limits, tends to be unaffected by fluctuations in the levels of activity (output or turnover). (CIMA Terminology) 21. Stepped Fixed Cost 22. Fixed Cost per unit