Question: You are working as a Management Accountant for Qatar Energy, a large oil and gas company located in the State of Qatar.

Assignment title

Management Accounting Principles and Practises

Unit Learning Outcomes

LO1 Explore the nature, source and purpose of management accounting information

LO2 Evaluate management accounting techniques to inform optimal resource

       allocation and decision making

LO 3 Analyze actual and standard costs to control and correct variances

LO 4 Evaluate how the management accounting function contributes to performance

         measurement and monitoring.

Transferable Skills and Competencies Developed

• Reasoning and analytical skills, decision making, planning and performance management systems
• Management accounting techniques to assist management in the formulation and implementation of business strategy
• Manipulation and interpretation of data using spreadsheets
• Utilizing variance analysis and the application of different costing approaches
• Creation and interpretation of information, showing how that information can be used most effectively to add value and evaluate organisations operating in complex environments
• Calculating and interpreting data using spreadsheets
• Effective communication of relevant information across the organisation and to appropriate stakeholders
• Ability to use quantitative skills to calculate data to make informed business decisions

Assignment Brief and Guidance

Vocational Scenario: The business case report will address the following

Section A:

You are working as a Management Accountant for Qatar Energy, a large oil and gas company located in the State of Qatar. The company is well known for its range of oil and gas products it produces for use locally and for export to its many trading partners internationally. As part of your role, the director of your department has asked you to prepare a document for a group of young trainee management accountants to explain to them the importance of the nature, source and purpose of management accounting information by answering the following questions:

1. Examine the different ways in which Qatar Energy will use accounting information to meet organisational objectives and explore how this information is purposeful to different stakeholders to maximise performance and minimise risk.
2. Critically evaluate the role and significance of management accounting information in supporting decision making, in meeting and exceeding the expectations of internal and external stakeholder needs in order to achieve competitive advantage at Qatar Energy.

Section B:

In your continued role of Management Accountant, you are to guide a group of young management accountant trainees on how to evaluate management accounting techniques to inform optimal resource allocation and decision making by producing the following:

1. Produce schedules from Appendix (A.1 & A.2) demonstrating the application of cost and management accounting techniques such a LIFO, FIFO and a Cost Sheet, using appropriate software applications such as Excel.
2. Evaluate the utility of management accounting techniques to inform decision making and optimal resource allocation at Qatar Energy.
3. Critically assess and justify the impact of using alternative management accounting approaches and techniques, including variance analysis on resource allocation, risk minimisation and profit maximization in supporting the achievement of organisational objectives.

Section C:

Your line manager needs you to prepare a portfolio for an upcoming presentation that must include the preparation of a Cost Variance Statement for the group of management accountant trainees for their understanding, in this portfolio, the following must be included:

1. Produce an Absorption Costing and Marginal Costing statement with the given data (Appendix B.1) you must also produce Cost Statement Variance to identify variances from data provided on Qatar Energy in Appendix B.2, you must also produce a cost variance statement.
2. Explore and evaluate the concept of variance analysis, the impact of identifying variances to control, monitor and improve organisational performance and its importance for budgetary control at Qatar Energy.

Section D:

Since you have performed very well in leading the group of management accountant trainees, your manager has now promoted you to the position of Senior Management Accountant at Qatar Energy. You have been asked to produce a report to the group of directors on management accounting and how this will be useful in helping the organization achieve its business objectives, control costs and monitor performance using a range of appropriate benchmarks. Your report to senior management needs to be clear, concise and accurate covering the following broad areas of management accounting:

1. Critique management accounting approaches to measuring and monitoring performance in the operational environment at Qatar Energy.
2. Apply and adjust management accounting approaches to support performance management and monitoring in complex operational environments at Qatar Energy, using the information provided in Appendix B.2, utilizing a range of appropriate benchmarks.

Recommended Resources

Textbooks

DRURY, C. (2015) Management and Cost Accounting. 9th Ed. Cengage Learning. SEAL, W. et al (2018) Management Accounting. 6th Ed. Maidenhead: McGraw-Hill. WEETMAN, P. (2019). Financial and Management Accounting: An Introduction.

Harlow: Pearson.

ZIMMERMAN, J. L. (2019) Accounting for Decision Making and Control. 10th Ed. New York: McGraw-Hill.

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