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Advanced Management Accounting AF4102 4 3 Seminars 42 hours

MODE OF STUDY : PRE-REQUISITES :

Management Accounting (AF3104)

OBJECTIVES (a) (b) (c) To develop students ability to perceive and formulate solutions to management decision problems. To enable students to design and evaluate systems for planning, control and performance measurement. To familiarise students with the recent development in management accounting techniques as tools for management control and decision making.

INDICATIVE CONTENTS Activity Based Costing and Activity Based Management Assigning servicing department costs to activities. Activity cost drivers. Using ABC for pricing and analysing customer profitability. Product substitution. Redesign products. Improve process and operation strategy. Cost Based Decision Making Target costing. Kaizen costing. Life-cycle costing. Other costing tools. Environmental, salvage and disposal costs. Performance and Management Control The Balanced Scorecard. Financial measures of performance. Measuring customer, internal business process and employee performance. Incentive and Compensation Systems The expectancy view of behaviour. Intrinsic and extrinsic rewards. Tying rewards to performance. Important attributes of compensation systems. The agency model. Management Control System Design The nature of management control systems. The management control environment and process. Contingency approach to system design. Strategic Management Accounting Approach
AF4102 (Updated in August 04)

Corporate objectives. Current situation analysis. Performance benchmarking. Strategy alternatives. Evaluation of achievements. Congruency with objectives. Nature of strategic planning. Analysing proposed new programmes. Analysing ongoing programmes. Strategic planning processes. Control for differentiated strategies.

TEACHING APPROACH This subject adopts real-life organisation-based cases in teaching. Through case analysis and presentation, students are provided with the ambiguous issues and problems found in actual organisations, enabling them to apply management accounting theory to these problems. This approach encourages students to think in terms of management accounting theory as a way of conceptualising problems and prescriptions for management accounting systems design.

ASSESSMENT* Continuous Assessment Examination * NO Mid-term Examination 35% 65% 100%

INDICATIVE READING Kaplan, R.S. and A.A. Atkinson, Advanced Management Accounting, 3rd Edition, Prentice- Hall, 1998.

REFERENCES Simons, R., Performance Measurement and control Systems for Implementing Strategy, Prentice-Hall, 2000. Cooper, R. and R.S. Kaplan, The Design of Cost Management Systems Text and Cases, 2nd Edition, Prentice-Hall, 1999. Selected articles from the professional journals.

AF4102

(Updated in August 04)