Report Impact of Managerial Accounting on Decision Making in Business

                Improvement and profitability are two main goals in any companies in the world. Every person in the company will give the effort to contribute so that the company will able to reach these two main goals. The accounting managers have acknowledged with their roles to practice the proper managerial accounting within the company. The individuals in this designation have certain different tasks to support the companies in making internal decisions that able to lead to improvement and profitability (Lambert & Sponem, 2012).

            Accounting is considered as a main key of all the information related to the business performance of any company. It could assist the managers to grow their knowledge about the environment that surrounds the company in many ways. Accounting is also make noticeable the events which might not observable by the daily business activities of a manager, and also delivers a complete quantitative viewpoint on their daily activities as well.

            A decision is quite important for the company since it is preceding to any business activities that the company perform in order to be survive in the business along with its development.  Any manager is endowed with official authority according to the assigned position. Making any decision is on the list of the most essential and crucial activities of companies since every single decision that has been made will create and lead to other innovative decision. These decisions might engage with the strategic plan of the company, or might also manage for daily business activities of the company (Trkman, McCormack, Oliveira, & Ladeira, 2010).

        For this reason, the management in the company is continually have to face with the issue of another decision-making, especially if they know the fact that resources are quite rare and limited. Therefore, the company needs to figure out on a proper use of resources and plan further steps to do in its business activities. Now that we are living in a world of data in a large quantity, business managers have gain access to do further analysis of the data which is transferring the method of how the business decisions were made. For this reason, it is relevant if we mention that quality accounting data has available for appropriate and exact decision-making, expansion of profitability, and also optimal usage of the rare resources. This is due to the accounting data is not just demanded for analysis of the previous and keeping the existing on progression, instead, accounting is also really useful in making the future plan for the company as well (Butterfield, 2016).

            Another study also has explained that a business is not exactly around accounting, it is more about markets, the people within the business, and also the business activities as well. In the other hand, accounting is quite complex in overall of the related decisions, due to it presents the financial performance of the business operations within the company. Management accounting has impacted the main approach of the business and led to the importance of the role to step out beyond its customary concern with a short range of numbers to integrate the bigger challenge in management, and to improve a strategic function of business partner (Schaltegger & Burritt, 2010).

        A natural sense of good decision-making appears to be intuitive for many managers. In the other hand, the reality inclines to be that reliably good decision-making is not often based only on intuition. However, a good decision-making is to back up the requirement of attentive accumulation and appraisal of information. This is the perfect time for the management accounting to appear and providing the requested data that needed in the process of decision-making (Hemmer & Labro, 2008).

        Another important role of the accounting managers is to influence the managers on the feedback data in the form of reports, appropriately analyzed, in order to enable the managers to measure if the business activities are running according to the company’s plan, and make some correction if necessary for the business activities. In specific, the management function must provide the economic reviews to managers, in order to support them in making decisions about the controlling costs, and also improving the competence and efficiency of the business activities (Malmi & Brown, 2008).

        The information from management accounting is considered to influence in improving the proper goals, long-term strategies and plans, support in reviewing the business performance of the company, also influence in deciding between the numbers of strategies available. In addition to this, the data that the company got from management accounting will be used to manage and distribute the limited resource of the business within an effective and efficient methods. With this way, the company will able to reach best level of production, combination of products, and also the best investments type. The data from management accounting also influences the decision-making process on a specific activities such as manufacturing a new products, or closing a department of the company (Berry, Coad, Harris, Otley, & Stringer, 2009).

        In simple words, we can conclude that the accounting managers give some advices that influence the decision-makers, then the decision-makers will apply those advices with the daily business activities of the company. Usually, the data that given by the accounting managers are form in rare data and numbers, which will be translated by the accounting managers into actionable tools. The accounting managers also consider as a link between the company itself and its shareholders, investors, and further external resources. The influence of managerial accounting really appears in helping the upper management of the company to lead the company in becoming profitable and develop by delivering the main financial views (Lee, 2008).

In the other hand, the range of influences from managerial accounting is go far beyond the numbers, tables, or charts that they present. Their influences are further line up into two forms (Abdel-Kader & Luther, 2008) which are:

Influence on the operating decisions

Influence on the strategic decisions

        The influence of managerial accounting on the strategic decision is clearly associated to the regionalization degree of a company. It also lies on whether the accounting managers are more assertive person or emotionally steady person. The accounting managers at the business unit level could get more opportunities to influence the operational and strategic decisions of the company.