Managerial accountants issue internal managerial reports periodically to provide information on departments' performances. This information aids managers in strategic decision-making, according to the book "Managerial Accounting." In an internal managerial report, an accountant evaluates a department's efficiency and quality of output. Department managers, the general manager, company officers and other staff members working in a supervisory capacity might read the reports.
Managerial accountants often issue internal managerial reports frequently, such as once a week or even once a day, according to "Managerial Accounting." These accountants have no standard set of guidelines to follow regarding the frequency of their reports. Thus, they issue these reports as needed, determining their own reporting schedule or working with managers to determine it. Using concise, clear language is especially important in frequent internal reports so staff can quickly understand the information.
Less Frequent Reporting
Managerial accountants can choose to issue reports less frequently, particularly if they are handling several other responsibilities. In this case, they might issue internal reports monthly, but might provide a report sooner than planned if they discover critical information a manager needs. Reporting only once a year or once a period would not typically provide the most useful information to management at the most critical times. Managers need information in a timely manner in order to act on it appropriately, according to Colin Drury in "Management and Cost Accounting."
Internal reports are typically confidential, to be shared only with specific people inside of the firm. These reports might inform reports for consumers, but the information must be adapted first. Managerial accountants might present their reports at meetings or give them personally to the staff members to whom the reports are primarily directed.
Comparison with Financial Accounting Reports
Financial accounting reports analyze what happened over a specific time period without making recommendations for the future. Financial reports are made at the end of the fiscal year or quarter, whereas internal managerial reports can be made at any time. Meanwhile, internal reports do make recommendations for future managerial decisions. The same accountant may handle both types of reports, particularly in a smaller company, or a firm may hire different people to fulfill the different roles.
- Managerial Accounting; Jerry J. Weygandt, et al.
- Managerial Accounting for Libraries and Other Not-for-Profit Organizations; G. Stevenson Smith
- Project Management; Dennis Lock
- Management and Cost Accounting; Colin Drury, et al.
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