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Showing posts from October, 2008

Changing role of Management Accountants

A couple of months back, Management Accountant Blog posted a guest post by CMA V R Kedia on "Emerging Role of Management Accountants in New Economy" . The role as described by CMA Kedia expected the management accounting practitioner should have attributes of a learning professional, a change agent and be hands on latest technology. Management Accounting techniques has undergone a lot of development from preparing Cost-Volume-Profit Analysis to latest techniques like EVA, Activity Based Management, Target Costing, Kaisen and many more. The expectation from management accountant has been changing consistently with the advancement of technology and new challenges faced to analyse business for its competitiveness. I wondered Management Accounting is a specialized field ..... is it necessary to have an accounting background ? According to New Accountant USA, "According to a study commissioned by the American Institute of Certified Public Accountants (AICPA), the ave

Are audited financial statements reliable

I am reading the article on the BBC website "Lehman Brothers Bank Collapse" dt 16-Sep-2008. The company is an investment bank that specialises in big and complex deals and investments. Despite this, Lehman's collapse and the troubles of other financial institutions will probably be felt by millions of people around the world - at least indirectly. Most of our banks and pension funds have dealings with Lehman, or with firms like hedge funds that traded extensively with Lehman. Unwinding Lehman's complex deals will take months if not years. During that time the global financial system will be snarled up. Many banks won't know for sure how much they are exposed to Lehman, and will have difficulty freeing up the money in those deals. This in turn is likely to intensify the credit crunch, with potentially dire consequences for businesses and consumers. Acer Extensa 4220 101G08Mi Laptop PC The other article "Three deadly sins of portfolio credit risk managemen

Have Auditors failed us ?

Prem Sikka in Guardian discusses on Auditors fees for giving a clean chit to the companies whose survival is doubtful now. "The deepening financial crisis brings daily news of corporate collapses and bailouts that plunder the taxpayers' pockets at an unprecedented scale. Innocent people are losing jobs, homes, pensions and investments. Each collapse shows that highly paid directors had little idea of the value of company assets, liabilities, income, costs, profits and financial health. This has been accompanied by one constant factor: the silence of the auditors. Auditors collected large amounts in fees and dished out clean bills of health." The government of Iceland has taken control of Glitnir , the third largest bank in the country, and injected €600m. The bank's 2007 accounts received a clean bill of health (page 69) from PricewaterhouseCoopers with an assurance, "We believe that the audit evidence we have obtained is sufficient and appropriate to pr

Immigration Updates 10-Oct-08

This is for the Accountants on the move. Recent updates in work permits or immigration procedures in different countries: United Kingdom 01-Oct-08: Points-based system - apply for your sponsor licence as soon as possible Under the points-based system, employers will need a sponsor licence to bring in skilled or temporary workers from outside the European Economic Area or Switzerland. You should make your application for a sponsor licence as soon as possible so we can make sure you get the earliest possible decision and minimise any delays to your recruitment process. Read More 11-Sep-08: Changes to Tier 1 guidance notes On 11 September 2008 new versions of the guidance notes for Tier 1 (General), Tier 1 (Entrepreneur) and Tier 1 (Post-study Work) applications were released. Read More 08-Sep-08: Strict new jobs list for migrant workers A strict new list of shortage jobs which targets migration better at the needs of British businesses, while reinforcing the selectiv

Accountable crises - Richard Aitken-Davies

The irresponsible bosses should face court. Others, we accountants included, must accept we've erred. Richard Aitken-Davies, President of ACCA writes in The Guardian Remuneration and incentivisation packages for senior figures within the banking world have rocketed, but these rewards have become too closely linked to short-term, easy-to-manipulate financial metrics. The traders of derivatives want to have their "profits" recognised straight away in the employers' accounts and, thus, in their annual bonuses. But bonuses need to be related far more closely to long-term financial performance and, importantly, to movements in cashflow, rather than profitability. Rewards should not be paid out until proceeds have been banked. Big savings on digital cameras at Misco The roles of the chairman and chief executive are ultimately ones of accountability - to shareholders, to customers, to staff and, whether they like it or not, to government, the taxpayer and society at

ICAEW UK launches new qualification

ICAEW launches Certificate in Finance Accounting and Business Qualification The Institute of Chartered Accountants in England and Wales (ICAEW) today launched a new stand alone business qualification, the Certificate in Finance Accounting and Business, intended to widen access to the profession both in the UK and internationally. The Certificate in Finance Accounting and Business (CFAB) is aimed at aspiring finance professionals looking to undertake a rigorous, industry benchmarked qualification, as well as providing a staging post for those considering the full ACA. Market research undertaken by the Institute identified that many already in business want to increase their career prospects with a grounding in finance and accounting. CFAB is also aimed at those with the potential but not necessarily the academic or vocational experience to take ACA in its own right. The qualification comprises six modules from the ACA professional stage – business and finance, management in

Does IT strategy of your company influence your career ?

Management Accountants are known for strategic accounting rather than doing mundane things. The Canadian Management Accountants recognise themselves as "Creative Accountants" . Yes, internal accounting is like that. A product may show profit by applying overheads in the traditional way but may go into loss when applied the concepts of ABC. Do you feel advances in Information Technology has direct influence on Management Accounting ? I have posted the point on forum and views of members are as follows: Rajendra Patil of Appsconsulting My primary answer would be 'YES". In various areas of management accounting, it is 'essential' to collect, calculate and present the data to the users. The advancement in the field of harware and software solutions has helped management accountant in a great way. First example would be the ERPs. The regular job of the management accountants in manufacturing industries is to calculate the cost