Cost management Essay Example | Topics and Well Written Essays - 4500 words

Cost management - hear Exampleent even the best securities industrying brains from boosting sales, the only option available to even the most adventurous management is to reduce addresss to maintain the existing profit level. At a cursory survey it seems to be the only and major power be the most prudent approach that any management might conceive. But ill conceived cost reduction triggered as a panic reaction to the gloomy market scenario might cause more harm to the company than any good as expenditures that are perfectly imperative for the companys health might be sacrificed in this new avalanche of trim down of expenses. The portion of the management accountant as a custodian of entire entropybase of the company has thusly assumed a critical importance as the management accountant occupies a vantage eyeshot from where a critical and dispassionate evaluation of exiting cost structure and a prudent management of costs, as contrasted to cost reduction, feces be implemen ted. There has thus been a phenomenal, and largely unnoticed, shift in the role of management accountant in managing a business.But this change can be properly apprehended only if one examines the basic nature of accounting and the inherent differences that exist in the midst of financial, management and cost accounting. This knowledge will equip an avid observer the wherewithal to adequately appreciate the subtle difference between cost and management accounting and cost management.The basic objective of accounting is interpretation of financial data to provide a sound basis for action by management, investors and other stockholders in the entire moneymaking(prenominal) venture. (Paton 1949) Thus, from a sum-end perspective the end is an expected cache of sound and economically relevant information and the means adopted can best be referred to as descriptions. From a more practical aspect it can therefore be said that accounting provides information for two distinct but inextri cably interlinked purposes the commencement ceremony one quite obviously consists of reporting to