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AFM Course Outline PDF

This document provides information about the "Accounting for Managers" course offered at the Indian Institute of Foreign Trade in Delhi. The 3-credit course is aimed to help management students understand and use financial data for decision-making. It will cover topics such as financial statements, cost behavior, cost allocation, budgeting, and standard costing. The course objectives are to understand financial reporting and use cost information for management decisions. It will be delivered through lectures and case studies, and students will be evaluated through assignments and a class test.

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177 views

AFM Course Outline PDF

This document provides information about the "Accounting for Managers" course offered at the Indian Institute of Foreign Trade in Delhi. The 3-credit course is aimed to help management students understand and use financial data for decision-making. It will cover topics such as financial statements, cost behavior, cost allocation, budgeting, and standard costing. The course objectives are to understand financial reporting and use cost information for management decisions. It will be delivered through lectures and case studies, and students will be evaluated through assignments and a class test.

Uploaded by

Prateek saxena
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Indian Institute of Foreign Trade, Delhi

EPGDIB 2020-2021
Course Name: Accounting for Managers

Course Coordinator: Dr Satinder Bhatia


Email: [email protected]
Term: I Credits: 3

Course Introduction

Accountancy is the process of communicating financial information about a business entity to


users such as shareholders and managers. Accounting is also defined as the art of recording,
classifying, and summarizing in a significant manner and in terms of money, transactions and
events which are, in part at least, of financial character, and interpreting the results thereof.
Management students need to understand financial data to be able to coordinate their decision-
making by using such data developed by accounting executives. This requires understanding
as to how financial and cost statements are built up and the assumptions in their preparations
that may lead to some ethical issues. Users of accounting information may be both internal and
external to the organization. When accounting information is used internally for decision-
making relating to different products or departments, it is referred to as management
accounting; otherwise, it is referred to as financial accounting. The course will cover both
financial accounting (external accounting) and management accounting (internal accounting).

Course Objectives

The objectives of the course are as follows:

i) Understand the financial statements including income statement, balance sheet and
cash flow statement of companies;
ii) Understand behavior of costs and their relationship with volume and profit
iii) Identify the behavior of overhead costs and devise appropriate strategy for
allocation of overhead costs to products and services.
iv) Using cost information in management decision-making
v) Formulating and using standard costs along with budgets and analyze variances in
costs.
Programme Learning Goals covered through this Course

LG 2: Innovative Thinking with Critical Analysis - Students will be able to apply knowledge
of international business management concepts to analyse business problems critically and
suggest innovative solutions

- Able to apply appropriate theories, models and tools to critically analyse the
problems/issues in international business situations *
- Able to develop innovative approaches towards solving of given problems/issues in
international business situations

Pedagogy

The course will be delivered through lectures and case studies. Financial statements and other
accounting data of companies will be used for illustrating the accounting concepts.

Evaluation Components

Assignment on Analysis of Financial Statements ---- 20 marks

Assignment on Cost Allocation and Management ----- 20 marks

Class Test * ----- 20 marks


Text Book / Reference Text

Managerial Accounting by James Jiambalvo, Wiley Publications

Session Plan:

Session Topic and Sub topics Reading

(with brief description of what intends to be achieved) Reference/Cases

1-2 Introduction to Accounting: Importance of Reference Books on


company accounts and principles governing Financial
accounting Accounting

3-5 Analysis of Financial Statements – Income Reference Books on


Statement, Balance Sheet and Cash Flow Statement Financial
Accounting

6 Behaviour of Costs: Understanding costs and their Chapter 1 of Text


behaviour is crucial to formulating and implementing
operation-level and corporate-level strategies.
External financial reports will be the starting point to
understand cost categories and cost behaviour.
Students are encouraged to analyze their own
company’s cost figures.

7-8 Preparation of Cost Statement: Calculation of cost Chapters 2 and 3 of


per unit and cost per equivalent unit Text

9-10 Cost Allocation and Activity-Based Costing: Cost Chapter 6 of Text


allocation, particularly overhead cost allocation,
impacts strategic decisions in a big way. This
includes pricing of products as well as identifying
value-adding activities. Activity-based costing,
which is relatively a new technique and activity-
based management have given a new dimension to
overhead allocation. It has also helped in identifying
value-adding and non-value-adding activities and has
thus contributed to Lean Accounting.
11-13 Cost-Volume Profit Relationship and Tactical Chapters 4 and 7 of
Decisions: This session is a build-up from Text
understanding the behaviour of costs. The
relationship between cost, volume and profit helps in
arriving at targeted break-even levels for the
organization. The session will also discuss how CVP
analysis helps in sensitivity analysis and how
activity-based costing together with CVP analysis
can enhance the quality of decisions.

14-15 Budgeting and Standard Costing: The session will Chapters 10 and 11
deal with the importance of developing standard of Text
costs, measuring and analyzing variances to take
strategic decisions regarding products/services. The
importance of fixed and flexible budgeting will also
be taken up in the session.

Additional Readings/ Journals (optional)

Students are encouraged to read other Managerial Accounting /Cost Management books in the
library. Similarly, students may read research articles from the following journals, using
databases such as Ebsco, Jstor, etc.

Journal of Cost Management


Journal of Management Accounting Research
Accounting, Organizations and Society
Harvard Business Review
Sloan Management Review

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