Managerial Accounting CH 1

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audit committee

a subcommittee of the board of directors that is responsible for overseeing both the internal audit function and the annual financial statement audit by independent CPAs.

board of directors

the body elected by shareholders to oversee the company

budget

quantitative expression of a plan that helps managers coordinate and implement the plan.

certified management accountant (CMA)

a professional certification issued by the IMA to designate expertise in the areas of managerial accounting, economics, and business finance.

chief executive officer (CEO)

hired by the board of directors to oversee the company on a daily basis

chief financial officer (CFO)

responsible for all of the company's financial concerns.

chief operating officer (COO)

responsible for overseeing the company's operations.

controller

position responsible for general financial accounting, managerial accounting, and tax reporting.

controlling

one of management's primary responsibilities; evaluating the results of business operations against the plan and making adjustments to keep the company pressing toward its goals.

cost-benefit analysis

weighing costs against benefits to help make decisions

cross-functional teams

corporate teams whose members represent various functions of the organization, such as R&D, design, production, marketing, distribution, and customer service.

decision making

identifying possible courses of action and choosing among them.

directing

running the company on a day-to-day basis.

enterprise resource planning (ERP)

software systems that can integrate all of a company's worldwide functions, departments, and data into a single system.

extensible business reporting language (XBRL)

data tagging system that enables companies to release financial and business information in a format that can be quickly, efficiently, and cost-effectively accessed, sorted, and analyzed over the internet

international financial reporting standards (IFRS)

SEC has recently moved to adopt IFRS for all publicly traded companies within the next few years. In many instances, IFRS vary from GAAP.

institute of management accountants (IMA)

professional organization that promotes the advancement of the management accounting profession.

internal audit function

corporate function charged with assessing the effectiveness of the company's internal controls and risk management policies.

ISO 9001:2008

quality related certification issued by the International Organization for Standardization (ISO) Firms may become ISO 9001:2008 certified by complying with the quality management standards set forth by the ISO and undergoing extensive audits of their quality management processes.

just-in-time (JIT)

inventory philosophy first pioneered by Toyota in which a product is manufactured just in time to fill customer orders. Companies adopting JIT are able to substantially reduce the quanity of raw materials and finished product kept on hand.

lean production

philosophy and business strategy of manufacturing without waste.

planning

one of management's primary responsibilities; setting goals and objectives for the company and deciding how to achieve them.

sarbanes-oxley act of 2002

congressional act that enhances internal control and financial reporting requirements and establishes new regulatory requirements for publicly traded companies and their independent auditors.

supply-chain management

exchange of information with suppliers to reduce costs, improve quality, and speed delivery of goods and services from suppliers to the company itself and on to customers.

sustainability

the ability to meet the needs of the present without compromising the ability of future generations to meet their own needs.

throughput time

time between buying raw materials and selling finished products.

treasurer

position responsible for raising the firm's capital and investing funds.

total quality management (TQM)

management philosophy of delighting customers with superior products and services by continually setting higher goals and improving the performance of every business function.

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