Managerial Accounting, Brewer, 4Ed, Prologue

Front 1

Globalization

Back 1

The reduction and removal of barriers between nations in order to facilitate the flow of goods, capital, services and labor.

Front 2

Effects of Globalization

Back 2

1. International competition: Greater variety and possibly better quality goods and services at lower prices. Threatens domestic companies.

2. Access to new markets, customers, and workers.

3. Cheaper labor.

Front 3

Business strategy

Back 3

A company's game plan to attract customers by distinguishing itself from its competitors.

Front 4

Customer Value Propositions

Back 4

1. Customer Intimacy: "we respond to your needs better than our competitors do."

2. Operational Excellence: "we deliver products/services, faster, at better prices."

3. Product Leadership: "we offer higher quality products."

Front 5

Organization Chart

Back 5

A diagram of a company's organizational structure (chain of command) that depicts formal lines of reporting, communication, and responsibility between managers.

Front 6

Decentralization

Back 6

The delegation of decision-making authority to managers relating to their area of responsibility.

Front 7

Line Position Employee

Back 7

Directly involved in achieving the basic objectives of the organization.

Front 8

Staff Position Employee

Back 8

Indirectly involved in achieving the organization's objectives.

Provide assistance to line positions.

Do not have direct authority over line positions.

Front 9

Controller

Back 9

Runs the accounting department. Reports directly to the CFO.

Front 10

Roles of a modern management accountant

Back 10

1. Act as an internal consultant or business analyst.

2. Work on cross-functional teams.

3. Active involvement in decision making.

Front 11

Value Chain

Back 11

Research and Development > Product Design > Manufacturing > Marketing > Distribution > Customer Service.

Customer's needs are most effectively met by coordinating these functions.

Front 12

3 Approaches to Improving Business Processes

Back 12

1. Lean Production

2. Theory of Constraints

3. Six Sigma

Front 13

Lean Production

Back 13

A business approach that employs the Lean Thinking Model.

Front 14

5 Steps of the Lean Thinking Model

Back 14

1. Identify value in specific products/services.

2. Identify the business process that delivers value.

3.Organize work arrangements around the flow of the business process.

4. Create a pull system that responds to customer orders.

5. Continuously pursue perfection in the business process.

Front 15

Lean Thinking Model

Back 15

A five step management approach that organizes resources around the flow of business processes and that pulls units in response to customer orders.

Front 16

Results of the Lean Thinking Model

Back 16

1. Lower inventories.

2. Fewer defects.

3. Less wasted effort.

4. Quicker customer response times.

Front 17

The ideal pull system for manufacturing includes:

Back 17

1. Purchasing and delivering only enough materials to meet the day's production demands.

2. No goods still in process at the end of the day.

3. All completed goods to be shipped daily to customers.

Front 18

Just-In-Time Production

Back 18

A system in which materials are purchased and units are produced only as needed to meet customer demand.

Front 19

Supply Chain Management

Back 19

An approach that coordinates business processes across companies to better serve consumers.

Front 20

Theory of Constraints

Back 20

A management approach that emphasizes the importance of managing constraints (bottlenecks).

Front 21

Six Sigma

Back 21

A method that relies on customer feedback and objective data gathering and analysis to drive process improvement.

Front 22

The Six Sigma DMAIC (pronounced: du-may-ik) framework

Back 22

1. Define: Scope and purpose of project. Diagram flow of current process. Establish customer's requirements.

2. Measure: Gather baseline performance data for existing process.

3. Analyze: Find root causes of problem.

4. Improve: Implement solutions.

5. Control: Ensure problems remain fixed.

Front 23

Non-Value-Added Activity

Back 23

An activity that consumes resources but doesn't add value.

Front 24

Enterprise System

Back 24

A software system that integrates data from across on organization into a single database allowing all employees to access common data.

Front 25

Institute of Management Accountants' (IMA) ethical code

Back 25

Statement of Ethical Professional Practice

Front 26

Sections of the Statement of Ethical Professional Practice

Back 26

Principles
1. Competence
2. Confidentiality
3. Integrity
4.Credibility

Resolution of Ethical Conflict

Front 27

Effects of loss of trust in business because of unethical behavior.

Back 27

1. Lower standard of living.
2. Lower quality of goods and services.
3. Less to choose from.
4. Higher prices.

Front 28

Company Code of Conduct

Back 28

A broad-based statement of a company's responsibilities to its employees, customers, suppliers, and the community.

Front 29

Corporate Governance

Back 29

The system by which a company is directed and controlled.

Front 30

Sarbanes-Oxley Act of 2002

Back 30

Protects the interests of investors in publicly traded companies by improving the reliability and accuracy of financial reports and disclosures.

Front 31

Key aspects of Sarbanes-Oxley

Back 31

1. Certification of financial statements by the CEO and CFO.
2. Established the Public Company Accounting Oversight Board to oversee the audit profession.
3. Removes power from management over the audit process and places it in the hands of the board of directors.
4. Places important restrictions on audit firms.
5. Requires an Internal Control Report in a company's annual report.
6. Establishes severe penalties.

Front 32

Enterprise Risk Management

Back 32

A process to identify business risks and provide responses to those risks instead of only reacting to problems.

Front 33

CMA

Back 33

Certified Management Accountant