BUSS1030 Lecture Notes - Lecture 12: The Surplus, Income Statement, Management Accounting

• School: University of Sydney
• Department: Business Studies
• Course: BUSS1030
• Professor: Abdul Razeed

Document Summary

Explain the relationship between corporate objectives, long-term plans and budgets, and also between planning and control. Long term (strategic) plan: defined the general direction of the business over next five years or so. Buss1030 lecture 12: management accounting useful in control process state plans (budgets) First four steps in decision-making, planning and control process: identify objectives, consider options, evaluate options and make a selection, prepare a long-term plan based on the most appropriate options. Projected financial statements may be prepared on the basis of: scenario analysis: an optimistic view of likely future events, a pessimistic view of likely future event, a most likely" view of future events. Projected financial statements normally prepared for internal purposes. Forecasts cannot be based on historic information whole process requires development of assumptions and estimates: underpins forecast and subsequent analysis and possible modification, soundness of final decision depends on soundness of assumptions and estimates.