ACCA Strategic Professional · Advanced Performance Management · Strategic management accounting
Brindle Foods, a packaged snack manufacturer, has historically reported only variance analysis from its cost ledgers. The new finance director wants management accounting to also supply competitor pricing data, customer profitability and market share trends to support decisions on entering new markets. Which description best characterises this change?
This is a shift towards strategic management accounting. It supplies external, forward-looking information such as competitor prices, customer profitability and market trends to support strategic decisions, rather than just internal historical cost variances or statutory reporting.
- AA shift towards strategic management accounting with an external and forward-looking focusCorrect
- BA move to statutory financial reporting for shareholders
- CA tightening of standard costing for stock valuation
- DAn extension of internal audit procedures over cost records
Explanation
Strategic management accounting extends beyond internal historical cost data to include external information on competitors, customers and markets, and it supports long-term strategic decisions. The other options relate to external reporting, inventory valuation or assurance and do not describe the change.
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