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Necessity of Management Accounting in Business decisions

Incidentally, management accounting brings certain information to the General Accounting. In some cases, its role is irreplaceable examples, assessment of stocks of finished products or evaluation of assets created by the company itself.

Overall, the Management Accounting is a tool to Management. It aims to give the company control its costs and its results. The costs come from the various components of the various activities of the company and that's the analysis that will identify accurately the costs that accrue to its various breakdowns and on which the final result.

However, the components activities are conducted by officials which establishes the responsibilities of each other in terms of cost. It is obviously necessary to avoid minimum uncontrolled development expenses of the company and the emergence of deficits.

From this point of view, cost analysis for all company levels of decomposition will allow to fine identification of causes of malfunctions or variances which compromise its results and profitability and to make any necessary adjustments .

One last point is to raise before entering further into the accounting technique that of periodicity in the cost calculation. There is no compulsion in the matter, it all depends on the company's policies.
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