Essentials Of A Good Information System In Cost Accounting
Essentials of a good information system are necessary to discharge cost accounting duties.With the help of the managers in charge of the Cost Accounting functions, the controller synchronizes participation in planning and control, by consulting with different fragments of management, regarding any stage of the operation of the business as it relates to the Accomplishment of objectives, the effectiveness of policies and procedures and the creation of organizational structures.
It is also a responsibility to observe the mode of planning and control throughout of the enterprise in an order that he may suggest enhancements in the planning and control system. To discharge these responsibilities, the controller’s function is immensely backed by an EDPS (electronic data processing system). Dependent on the improvement made in the use of computers, the support offered will Produce the effective development of a new information technology which necessitates the use of these modern computer and communication facilities. Essentials of a good information system
Integrated and coordinated information system should afford exactly the data and supplementary information required, and no more, to each responsibility head in harmony with his needs. Essentials of a good information system will require many things to consider.
A good information system requires the establishment of:
(1) long term objectives
(2) an organizational plan showing delegated responsibilities in detail
(3)detailed plans for future operations, both long- and short range and
(4)procedure for implementing and controlling achievements of these plans.
Essentials of a good information system find a contrast of the characteristics of the three management levels which highlights the resemblances, differences, and interrelationships among these groups. Executive management is primarily concerned with long-term decisions, middle management are concerned with decisions of medium-range impact, and operating managers with short-range decisions. The information Necessities for each level of planning and control may differ significantly.
Executive management, involved in strategic planning, sets objectives and determines the resources to be applied in meeting these objectives. For these tasks essential information ingredients should consist of long-term trends, extensive manpower studies, external information, and reports of achievements. The middle management engaged in tactical planning and control decision making relied upon summaries, exceptions, operating results and estimates relating to internal Information of the enterprise.
The operating management requires data on internal events relating to daily, weekly, or monthly transactions to fulfill its operational duties and responsibilities. If these essentials of a good information system are met cost accounting will be passion for accountants.