THE ROLE OF MANAGEMENT ACCOUNTANT TO COST CONTROL & PROFIT MAXIMISATION.pdf

THE ROLE OF MANAGEMENT ACCOUNTANT TO
COST CONTROL AND PROFIT MAXIMIZATION IN
AN ORGANIZATION
2021
Written & Presented by KINGE PLAN M.|
Level 300 :Research Dissertation on cost control and profit performance
HIST/IUL University: Field of Business and Finance Department of Accountancy
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By
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Thesis Supervisor:
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August 2021

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Certification
This is to certify that this project titled “THE ROLE OF MANAGEMENT
ACCOUNTANT TO COST CONTROL AND PROFIT MAXIMIZATION IN
AN ORGANISATION”, has been carried out by KINGE PLAN M. with
registration number........for the award of a Bachelors Degree of Accountancy
Signature……………………….
Supervisor……………………… Date……………………………

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Dedication
TO
MY DARLING PARENTS & THE KINGE’s FAMILY

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2021
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Acknowledgments
Without the efforts and contribution of the following people the realization of this
piece of work will not have been possible, I owe them my sincere gratitude.
To prof. Mbah Nelson Zhea my supervisor for his keen attention and numerous
corrections which enables the realization of my work.
To all my lecturers for all their words of encouragement esp. Prof Mungusi
Kingsley for his lectures in class.
Special thanks goes to the Kinges’ family most esp. to Mr/Mrs Kinge and not
forgetting Daddy Kum Mathias he has been a wonderful father so far.
For all their financial, moral and material supports. And for those, whose names
are not mentioned, Love you all………….

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ABSTRACT
The management accountant is identified as one of the key officers in the accounting
department of any manufacturing organization. He has the duty of providing the required
professional information relate to achieving the organization goal. Some of his functions
include planning and controlling activities formulation of strategy, decision making,
optimizing the use of resources etc.
In his planning function he quantifies and interprets the effect of planned transaction and
other economic event of the organization. The management accountant by virtue of his
duties participates indirectly in the management process of a business entity. This
research work aims to bring to the knowledge of its user the role a management
accountant plays in the achievement of the goal of every manufacturing outfit which
is profit minimization. The work is organized in five chapters, chapter one is the
introductory part which includes the background of problems, significance of the study,
scope and limitation of the study. Chapter two is the literature review this is where the
opinions of various authors in related subjects are reviewed chapter three deals with the
research design and methodology. This could be seems as a framework or a plan that is
used in collecting analyzing the data for the study. It reveals the sources of the data the
sample used and the method of investigation. In chapter four the data are being presented
and analyzed the hypotheses stated were adequately tested and decision taken. Finally in
the fifth chapter the finding of the research work is disclosed and recommendations or
suggestions are given for the benefit of the user.

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Résume
Le comptable en management est identifié comme l'un des principaux responsables du
service comptable de toute entreprise manufacturière. Il a le devoir de fournir les
informations professionnelles requises relatives à la réalisation de l'objectif de
l'organisation. Certaines de ses fonctions incluent la planification et le contrôle des
activités, la formulation de la stratégie, la prise de décision, l'optimisation de l'utilisation
des ressources, etc.
Dans sa fonction de planification, il quantifie et interprète l'effet de la transaction
planifiée et d'autres événements économiques de l'organisation. Le contrôleur de gestion
de par ses fonctions participe indirectement au processus de gestion d'une entité
commerciale. Ce travail de recherche vise à porter à la connaissance de son utilisateur le
rôle que joue le contrôleur de gestion dans l'atteinte de l'objectif de tout équipement
manufacturier qui est la minimisation du profit. Le travail est organisé en cinq chapitres,
le premier chapitre est la partie introductive qui comprend le contexte des problèmes,
l'importance de l'étude, la portée et les limites de l'étude. Le chapitre deux est la revue de
la littérature. C'est là que les opinions de divers auteurs sur des sujets connexes sont
passées en revue. Cela pourrait être un cadre ou un plan utilisé pour collecter et analyser
les données de l'étude. Il révèle les sources des données, l'échantillon utilisé et la
méthode d'enquête. Dans le chapitre quatre, les données sont présentées et analysées, les
hypothèses énoncées ont été testées de manière adéquate et des décisions ont été prises.
Enfin, dans le cinquième chapitre, le résultat du travail de recherche est divulgué et des
recommandations ou des suggestions sont données au profit de l'utilisateur.

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TABLE OF CONTENTS
Title Page………………………………………………………………………..ii
Certification…………………………………………………………………….iii
Dedication………………………………………………………………………iv
Acknowledgment………………………………………………………………..v
Abstract…………………………………………………………………………vi
Resume…………………………………………………………………………vii
Table of Contents……………………………………………………………..viii
CHAPTER ONE……………………………………………………………………………………1
INTRODUCTION……………………………………………………………………..1
1.1 Background and research context…………………………………………………1
1.2 Statement of Problem………………………………………………………………3
1.3 Research Question………………………………………………………………....4
1.4 Purpose/Objective of the Study…………………………………………………....4
1.5 Statement of Hypothesis…………………………………………………………...4
1.6 Significance of the Study…………………………………………………………..4
1.7 Scope of the Study…………………………………………………………………5
1.8 Limitation of the Study…………………………………………………………….5
1.9 Definition of some Terms………………………………………………………….5
CHAPTER TWO……………………………………………………………………………………6
REVIEW OF RELATED LITERATURE………………………………………….6
2.1 Definition of Profit Maximization………………………………………………....6
2.1.1 The Concept Cost……………………………………………………………..6
2.1.2 Direct Material Cost…………………………………………………………..7
2.1.3 Direct Labor Cost……………………………………………………………..7
2.1.4 Over Head Cost……………………………………………………………….7
2.1.5 The Concept of Cost Reduction………………………………………………7
2.2 The Function of Management Accountant Relation to Profit Maximization……..9
2.2.1 Standard Costing……………………………………………………………..10
2.3 Comparing Actual Cost with Target Cost…………………………………….......11
2.3.1 Material Price Variance……………………………………………………...11

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2.3.2 Material Usage Variance…………………………………………………….11
2.3.3 Marginal Costing…………………………………………………………….12
2.3.4 Uses of Marginal Costing Principles………………………………………...12
2.3.5 Cost-Volume-Profit (CVP)..…………………………………………………12
2.3.6 Contribution Margin…………………………………………………………12
2.3.7 Budgeting…………………………………………………………………….12
2.3.8 Importance of Budgeting…………………………………………………….13
2.3.9 Period Budget………………………………………………………………..13
2.4 Relationships among the Period Budget………………………………………….13
2.5 Ways of Regulating Cost in a Manufacturing Company…………………………14
2.5.1 Cost Control………………………………………………………………….14
2.5.2 Cost Reduction……………………………………………………………….14
2.5.3 Planning for Cost Reduction…………………………………………………15
2.5.4 Ways of Reducing Cost………………………………………………………15
2.5.4 Methods of Reducing Labor Costs…………………………………………..16
2.6 THEORETICAL REVIEW……………………………………………………….16
2.6.1 Contingency Theory……………………………………………………….....16
2.6.2 Institutional Theory…………………………………………………………..16
2.6.3 Giddens' Structuration Theory…………………………………………….....17
2.6.4 Bourdieu's Theory of Practice……………………………………………….17
2.6.5 Actor-Network Theory………………………………………………………18
2.6.6 Theory of Communicative Action…………………………………………...18
CHAPTER THREE……………………………………………………………………………..19
RESEARCH DESIGN & METHODOLOGY……………………………………19
3.1 Sample Used……………………………………………………………………...20
3.2 Method of Investigation…………………………………………………………..20
3.3 Distribution of Questionnaires…………………………………………………...20
3.4 Method of data analysis…………………………………………………………..20
3.4.1 The Chi-Square (X2
) Method………………………………………………...21
CHAPTER FOUR………………………………………………………………………………….22
DATA PRESENTATION, ANALYSIS & DISCUSSION OF FINDINGS…..22
4.1 Data Presentation and Analysis…………………………………………………...22

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4.2 Data Classification………………………………………………………………..22
4.2.1 Question 1……………………………………………………………………23
4.2.2 Question 2……………………………………………………………………23
4.2.3 Question 3……………………………………………………………………23
4.2.4 Question 4……………………………………………………………………24
4.2.5 Question 5……………………………………………………………………25
4.2.6 Question 6……………………………………………………………………26
4.3 Test of Hypothesis………………………………………………………………...26
4.3.1 Hypothesis One………………………………………………………………26
4.3.2 Hypothesis Two……………………………………………………………...28
4.3.3 Statement of Hypothesis……………………………………………………..28
CHAPTER FIVE………………………………………………………………………………....30
SUMMARY OF FINDING, CONCLUSIONS & RECOMMENDATIONS….30
5.1. Summary of Finding……………………………………………………………..30
5.2 Conclusions………………………………………………………………………32
5.3 Recommendations………………………………………………………………..32
Bibliography…………………………………………………………………………….34
Appendix 1Research questionnaire……………………………………………………..42
Appendix 2Scope of Cost Control………………………………………………………47

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INTRODUCTION
1.1 Background and research context
Due to the complexities in the system of most organizations the system of cost
accounting is equally becoming complex and resultantly a body of professional with
special expertise in this is created. This body of professional is called the management
accountants and the area of study is known as management accounting.
Woody et al (1985) define management accounting as the process of identification
measuring accumulating analyzing preparation in interpretation and communication of
financial information used by management to plan events and control within an
organization and to ensure proper use and accountability of its resources. From the above
definition it means that the management accountant has a range of function to carry out in
organization.
According ICMA “management accounting is the presentation of accounting
information in such a way as to assist management in the creation of policies and in the
day-to-day operation of an undertaking”.
To achieve this aim, the management accountant is interested in the past, present
and the future. Useful information extracted from past results which together with report
of current performance points the way to immediate management action. In the same vein
forecasting the future enables the management to evaluate current result more readily and
may also reveal areas of business which requires immediate attention.
David fanning (1983) defined management accounting as “the application of professional
knowledge and skill in the preparation and presentation of accounting information in a
way to assist the management in the formulation of polices and in the planning and
control of operating or the undertaking which is designed to provide information for
internal problem solving. The management accounting system of planning and control is
designed to spur up and help chief executive search for and selecting short run and long
run goals and implementing plans apprising performance and pinpointing deviations from
plan.
To be able to do all these, the management accountant must possess some
knowledge of account. He must have a thorough understanding of the operation of the

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organization in which these systems are implemented and the appropriate technology to
apply in each case for the provision of management information. Information depends
solely on the type of business. It is obvious that the management of a manufacturing
company will need information that will enable them consider the factor affecting cost of
production, cost of classification, cost of reduction, product pricing market shares of the
products choice of the product lines diversification and investment. However a trading
company needs information that will concentrate decision on customers’ demands
advertisement and product branding.
The management accountant uses data from the financial and cost accounting
system. To perform his ask he conducts special investigations and uses accounting and
other appropriate techniques from statistic and operation research. He considers the
human element in all activities so that at all times he will be provided with information
which is relevant for carrying out his work effectively so as to maintain his value or even
enhance it. In addition he interprets data and communicates same to the management.
The inability of the management accountant to perform his duties would result in
shortage of information for long and short run planning system thereby affecting the
noble objective of any business organization which is profit making.
Woldi (1976) opines that profit maximization can only come about through an
efficient and effective management process and Cameroon being a developing country it
is clear that the cost of running a business is increasing at a very high rate. Many
manufacturing companies in Cameroon have this as a problem. the struggling to maintain
reasonable amount of earning in a situation where costs are rising there by making profit
margin more and more difficult to sustain mean while the Cameroon manufacturing
companies as reported by the manufacturing association of Cameroon in its 1997
economic review are faced with escalating costs of production arising from the adoption
of macro-economic policies which are inflationary in nature. This trend reinforces the
imperativeness of the application of sound management accounting technique in the
manufacturing companies. The implication is that the principle of management is rarely
applied in most manufacturing firms in Cameroon.
A careful study of Cameroon manufacturing companies shows as decrease in
productivity this is as a result of gross incompetence and lack of motivation on the part of
the top management and their subordinates consequently there has with the general
planning and control of the firms resources thus profit maximization is firmly rooted in
the effectiveness of the planning and control of the firms resources. Generally speaking

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the role of a management accountant is based on his technical knowledge experience and
judgments in contributing to the success of the manufacturing industry.
1.2 Statement of Problem
There has been a considerable lack of appreciation by many as to the intrinsic
value of management accountants. Manufacturers, other business executioners have had
to appreciate where such value have stimulated the development of management
accounting as an information toils in business organization. Such events include the
increased competition in business and rapidly developing technology. The resultant
changes that have emerged have intensified managers need for information that is
continually for financial information beyond that contained in the traditional income
statement and balance sheet. The advent of scientific breakthrough have resulted in the
development many more basic components such as the transistor and electronic “chip”
which have literally revolutionized many industries and their products. Scientific
researcher reports that this revolution is only the beginning. Drastic changes have taken
place in production method over the last three decades the term ‘Automation’ has crept in
and today may product are produced ritually untouched by human hands. For example oil
refinery operation are controlled by massive computer networks machine tools are
electronically controlled and there are even some entire manufacturing plant where
workman do little more than monitoring instrument panel modes of management and
method of decision making have been affected by the development of new and powerful
quantitative toils such as linear programming probability analysis and decision theory.
These new toils which have come to be from the mathematical and statistical sciences are
becoming indispensable in day-today-decision making. The problem of increase cost of
production have forced the companies involved to make many adjustment which
modification of product changes in the methods of production and even marketing and
the discovering of new sources of financing production some company go as far as
reducing the quality of raw material and up producing less quality producing which
cannot help matters in the long run.
The economic impact of these and other factors have been far reacting as manger
of companies are now competing and cost of production escalating these has in effect
compounded the role of management accountant as an information tools over the years.
There is also the problem of poor inventory management which leads to
overstocking there by tying down the company’s working capital. Another kind of

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problem that is facing some companies is the installation of improper plans to reduce cost
of production so as to maximize profit e.g. making use of low quality raw material.
1.3 Research Question
1) What’s cost and the various types of cost existing in most organizations in
Cameroon?
2) How does cost reduction techniques affects profit maximization in Cameroon’s
Organizations?
3) To what extent does fixed cost over the relevant range of output affects profit
maximization in Organizations in Cameroon?
1.4 Purpose/Objective of the Study
The main purpose of this study is to analyze the role of management accounting
concerning profit maximization and to curb down cost in an organization.
The specific purposes of this study are as follows;
1) To examine the effect of cost and cost reduction techniques, for the purpose of
profit maximization in Cameroon’s organization.
2) To examine the effect of organizations fixed cost over the relevant range of output
for the purpose of profit maximization
1.5 Statement of Hypothesis
 Ho: Null- Hypothesis
 H1: Alternative Hypothesis
Ho: Cost reduction does not significantly affect profit maximization
H1: Cost reduction significantly affects profit maximization
Ho: The Company’s fixed costs do not significantly affect profit maximization.
H2: The Company’s fixed costs significantly affect profit maximization.
1.6 Significance of the Study
The significance of this study is to bring to the notice of the management the exemplary
role of management accounting and the techniques used to provide information and also

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how these would affect the operations and the attainment of the organizational goal if
these information provided are not recommended for use by the management with such
knowledge and information put to use management would be able to plan control the
organization such that the cost of operating the business will be at a minimum while
profit will be enjoyed at the end.
1.7 Scope of the Study
This study revolves around CDC Cameroon a manufacturing organization.
1.8 Limitation of the Study
Some limitations were encountered by the researcher in the process of preparing this
work, an example was the
The time available to carry out the research was short and insufficient besides, the
researcher had other courses in the school curriculum to contend with so as to
present a good result
The researcher had difficulties in finding related literature on this topic which
would have assisted him in presenting a comprehensive work
The research lacked finance with which to administer the questionnaires and
facilitate follow up visits and some other requirements.
The researcher sometimes lacked cooperation from the company executives who
often time complained of sufficiency of time for proper attention.
1.9 Definition of some Terms
1) Profit maximization: optimizing the usage of available resources for better or
greater profit making
2) Role: A part, which a person plays in real life.
3) Firm: A business concern or a company.
4) Management accountant: This is a person who is responsible for keeping
account that is keeping records of amount spent and that received and also
providing management information.
5) Journal: A newspaper or magazine that deals with a particular subject or
profession.
6) Linear programming: This is a mathematical technique concerned with the
allocation of scarce resources. It optimizes the value of some objectives.

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REVIEW OF RELATED LITERATURE
2.1 Definition of Profit Maximization
Profit maximization is where a firm makes the greatest profit out of the little resources
that is available to them. The concept of profit maximization is fundamental to the idea of
achieving a corporate goal. According to Pandey (1999) “it is an input-output relationship
occasioned by an introduction of scare resources as input into a manufacturing process in
order to derive outputs that could be offered for consumption either domestically or
industrially above the cost of production”.
Profit can be defined as the excess of income over expenditure either for a single
transaction or for a series of transaction. Generally when profit are referred to in business
what is meant is profit after all costs expense and taxes of all kinds have been subtracted.
Profit plays a special role in a free enterprise economy e.g they provide a yard stick with
which to measure the efficiency of the economy. There are various measure of attiring
profit maximization. Embedded in them are concept that sponsor the goal of profit
maximization significantly there exists two major concepts that lead to the improvement
of profit and its maximization or cost reduction.
According Adenji (2001) “profit maximization suggests production in even
increase quantities though Cleary at some stages a limit would be imposed by the existing
capacity either to produce or the sell. But in practice both selling price and cost price are
likely to vary with quantity of output”.
2.1.1 The Concept Cost
According to Adeniji (2001) “cost is described as the total amount of expenditure
incurred in the course of production manufacturing a product and rending service. The
whole process of cost ascertainment is directed to awards the establishment of what is
actually cost to produce an article. The cost involved past costs the cost ascertainment
process is concerned with collecting classifying recording analyzing and reporting upon
the financial consequences of part action”.

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The total cost of manufacturing can be classified into three broad headings
popularly known as the elements of costs. They include direct material cost, direct labor
cost and overhead cost.
2.1.2 Direct Material Cost
These are material that eventually become part of the finished product and can be
conveniently and economically traced to specified product units for example wood that is
used to manufacture desk can easily be identified be classified as direct material cost.
2.1.3 Direct Labor Cost
This consists of those labor costs than can specifically be traced or identified with
a particular product. Example of direct labour cost includes the wages operatives who
assemble part into finished product, or machine operatives engaged in production
process.
2.1.4 Over Head Cost
This consists of all manufacturing costs other than direct labor, direct materials
and indirect expanses. It therefore includes all indirect manufacturing labor and material
cost plus indirect manufacturing expenses. Example of indirect manufacturing expenses
in a multi-product company includes rate of the factory and depreciation of machinery.
Manufacturing overhead cannot be traced directly to a product. Instead they are assigned
to product using cost allocations. Cost allocation is the process of estimating the cost of
resources consumed by products that involve the use of surrogates’ rather than direct
measure.
2.1.5 The Concept of Cost Reduction
Cost reduction is essentially the reduction or lowering of the cost of production or
operation in an organization while still manufacturing he functional value. It aims at
reducing the target cost by a systematic approach and at the same time give the customers
as good if not better value for their money while reducing the cost of making and
supplying the goods and service.
As one of the methods of profit maximization it is sate and simple since it does not
depend on external changes. The process of cost minimization is profit itself. Every
reduction in annual cost has its counterparts in an equivalent increase in annual profit.

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Where a company successes in immunizing its annual cost of product by one percent
(1%) it will have a commensurate increase in annual profit. According to the chartered
institute of management accountants (CIMA) cost reduction is the achievement of real
and permanent reduction in the unit cost of goods manufactured and services rendered
without imparting their suitability for the intended purpose.
This definition reveals the following characteristic of cost reduction.
 Cost reduction must be permanent since temporary reduction cost is due.
 Cost reduction must be real through increased productivities to wind full change in
market prices
 Cost reduction must not impair the functional value of product or service. For the
use intended.
The concept of cost minimization should emanate from an organized and planned
action of the organization. The scope of cost is so wide that it is not practicable to
develop fully the areas in which it can be applied. It is a pragmatic strategy requiring
systematic approach to be achieved. The management accountant who has this as one his
responsibilities will have to undergo the various procedures involved before deciding on
the approach.
An exemplary diagrammatic explanation can be seen below;
Source: New concept of cost management archives

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2.2 The Function of Management Accountant Relation to Profit Maximization
Druny (2000) expressed that management accountant has the following function
perform.
1. He provides relevant information to help managers make better decision. This
involves both routine and non-routine reporting. Routine information is required in
relation to the profitability of various signets of the business such as product
service customer and distribution channel in order to ensure that only profitable
are undertaken.
2. Provides accurate information which is required in decision marketing to
distinguishing between profitable and unprofitable activities. If the cost system
does not caption accurately enough the consumption of resources by products the
reported product or service cost will be distorted and there is danger that managers
may drop profitable products or continue with the unprofitable products.
Situations where cost information provided by the management accountant is used
to determine selling price the under costing of product can result in the acceptance
of unprofitable business where as over costing can result in bids being rejected and
the loss of profitable business.
3. Management accountant also provides information for planning control and
performance measurement. Planning involves translating goals and objective
into the specific activities and resources that are required for the attainment of
profit after production.
4. The management accountant provides the management with feedback information
if he forms periodic reports suitably analyzed to enable them determining if
operations are proceeding according to plan and identify those activities where
corrective action is necessary.
5. The management accountant should particularly perform the function of providing
the managers with economic feedback to assist them in controlling costs
effectively and improving the efficiency and effectiveness of operation. All these
are efforts geared towards maximization of profit by the firm.
A picture of the explanation is depicted below

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Source: Google repository archives
Below are some of the tools at the disposal of the management accountant in
achieving the goal of profit maximization while employing the aforementioned concept.
They include standard costing marginal cost volume-profit analysis and budgeting.
2.2.1 Standard Costing
According (Druny 2000) “standard cost are predetermined costs they are target
cost that should be incurred under efficient operating conditions. A standard costing
system can be applied to organizations that produce many different products as long as
production consists of a series of common operations.
Standard costing is a system of cost accounting which makes use of determined
standard cost relating to each element of costs material labor and overhead for each line
of product manufactured or service supplied. Actual cost incurred are compared with the
two is known as “variances”. These are analyzed by reason so that inefficiency may be
quietly brought to the notices of the persons responsible for them and appropriate actions
may be taken.
It is a tools used by management for cost planning and cost control purpose.
When a company uses standard costs all cost affecting the investor accounts and the cost
of goods sold account are stated in terms of standard of per-determined cost rather than

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actual cost incurrent. In practice five standards are usually predetermined for the product
of a manufacturing company. They include:
1. Material quantity standard: This is the amount of material that should be used for a
unit of product.
2. Material price standard: This is cost per unit of material.
3. Labor quantity standard: This is the amount of labor usually expressed in direct
labor hours that should be used per unit of product.
4. Labor price standard: This is the cost of direct labor per direct labor hours the
common name for this types of standard is wage rate standard.
5. Overhead standard: This is the amount of overhead cost that should be per direct
labor hours.
From the definition it will be seen that the following processes are involved:
1. Predetermination of standard cost.
2. Recording of actual costs.
3. Comparing actual cost with standard cost.
4. Obtaining the cost variances.
2.3 Comparing Actual Cost with Target Cost
2.3.1 Material Price Variance
This occurs when you compare the standard price with the actual price and there is
a difference. Either that the price in the standard costs this could occur due to an
unexpected increase in the prices of material or a decrease in the discount payable when
purchasing goods from the suppliers.
2.3.2 Material Usage Variance
This occurs when the actual material used is greater or less than the quantity of
due trial that was budget. It may be due to excessive soup spoilage or to lower proportion
of off cut materials. Similarly actual labor cost may be higher or lower than the standard
labor cost giving rise to what is called direct wage variance.

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2.3.3 Marginal Costing
Marginal costing is a method of costing that distinguishes between fixed cost and
variable cost. The marginal cost of products is its variable cost that is it includes direct
material direct labor direct expenses and the variable part of overheads. This is used in
making decision that occurs within the short run.
2.3.4 Uses of Marginal Costing Principles
1. It can be used as a basis for providing information to management for planning
and decision making
2. On the other hand using marginal cost fixed cost are not absorbed into the cost of
producing and they are treated as period cost and written off in each period in the
costing profit and loss account.
2.3.5 Cost-Volume-Profit (CVP)
Druny (2000) says that cost-volume-profit is a systematic method of examining
the relationship between changes in activity (ie output) and changes in total sales revenue
expenses and net profit.
Adeniji (2001) opines that C-V-P represents an application of marginal costing
that seeks to study the relationship between cost volume and profit at different activity
level and can be value upon for short-term planning and decision making.
2.3.6 Contribution Margin
This is the excess of revenues over all variable costs related to particular sales
volume. It used to cover the fixed expenses and them whatever towards profit if the
contribution margin is not sufficient to cover the fixed expense then a loss occurs for the
period.
2.3.7 Budgeting
Malomo (1996) said that a budget is a predetermine statement of management
policy which provides for comparison of results actually achieved during a given period.
It’s a financial or quantitative plan of operation for a forth coming accounting year.
2.3.8 Importance of Budgeting

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Budgeting is very essential in human endeavor since it is the bane for profit
maximization and serves as a plan for a future fiscal period of a business or a firm.
Budgeting enables the certainty. Some of the benefits are:
1. It forces the manager to think and achieve by requiring him to formalize his planning
effort.
2. It provides definite goals and objectives which serve as a bench mark for evaluating
subsequent performance.
3. It uncover potential bottle necks before they occurrence.
4. It coordinates the activities of the entire organization by integrating the plan and
objectives of the various departments with the broad goal of the entire organization.
The act of preparing the budget termed budget planning involves the development
of future objectives and the formulation of steps to achieve this objective. Profit
maximization is one of such objectives and it calls for accurate planning a budgeting
system to be effective. It must provide a control for the plans involved.
2.3.9 Period Budget
A period budget is a forecast of a year’s operating result for a segment of
company. It is a quantitative. Expression planning activities period budgets are prepared
by the whole management term. They require timely information and careful
coordination of this information.
2.4 Relationships among the Period Budget
Period budget are generally prepared for each departmental or functional cost and
revenue producing segment of a company. These budgets are usually the following:
i. Sales units
ii. Production unit
iii. Selling and distribution unit
iv. Direct material usage
v. Labor hour requirement.

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These budgets are closely related to each other following the sales unit these
budget can be prepared. The selling expanses budget also depends on the sales. The key
point to remember here is that the whole budgeting process being with the sales unit
forecast some of these period budgets are explained below.
2.5 Ways of Regulating Cost in a Manufacturing Company
For a company to achieve its aim of profit maximization cost incurred by the
company in the process of production must be properly regulated. The concepts of cost
control and cost reduction will be looked into as they are very essential for the
achievement of this aim.
2.5.1 Cost Control
Wilson (1984) opines that cost is essentially the monitoring in an organization
while maintaining the quality of the planned or budgeted cost by systematic approach or
techniques. Cost control is one of the fundamental methods improving profitability.
Sometimes it is the only open way to a company.
Adeniji (2001) says that cost control is the regulation of the cost of operating a
business and is concerned with keeping cost with acceptable limits. These limits will
usually be specified as a standard cost limit in a formal operational plan or budget. If
actual cost differ from planned costs by an excessive amount cost control action will be
necessary. You exercise in good have keeping by avoiding wasteful use of valuable
resources and encouraging efficiency and cost consciousness.
2.5.2 Cost Reduction
This in contrast to cost control starts will an assumption that current cost level or
planned cost level are tow high even though cost control might be good enough and its
efficiency level high. Cost reduction is a planned and positive approach to reducing
expenditure, it is defined by CIMA as “the reduction in unit cost of goods or service
without impairing the suitability for the use intended.
Cost control action ought to lead to a reduction in excessive spending (for example
when material wastage is liger than budget or productivity level below agreed standards).
A cost reduction programine however can be directed towards reducing expected cost
level by cutting cost to below budgeted or standard level by purchasing new equipment or

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changing methods of working. Both budget and standard rejects current cost and
conditions and not necessarily the cost and conditions which would minimize cost.
2.5.3 Planning for Cost Reduction
These are two basic approaches to cost reduction as was reiterated by Adeniji
(2001) they include:
1. Crush programmes to cut spending level: profitability or cash flow the
management might decide on an immediate programme to reduce spending to a
minimum by abounding some current project differing capital expenditure making
some employees redundant and stopping new recruitment and so on.
2. Planning programs to reduce cost: many companies tend to introduce crash
programmes for cost reduction time of difficulty. A far better approach is to
introduce continual assessments of an organization’s entire products production
methods services internal administration systems and so on.
2.5.4 Ways of Reducing Cost
1) Improving efficiency and efficiency standards: One way of reducing cost is
improving the efficiency of material usage the productivity of labor or the
efficiency of machinery or other equipment.
2) Labor productivity can possible be improved by the following methods:
i. Giving pay incentive for letter productivity.
ii. Changing work methods to criminate unnecessary procedures and make
better use of labor time.
iii. Improving the methods for achieving co-operation between groups of
departments. Cost that is the cost of faulty goods produced under pressure
during unrealistically high overtime periods.
3) Improving the efficiency of equipment usage might involve the following.
i. Making better use of equipment resources.
ii. Achieving a better balance between preventive maintenance and machine
down time for repairs.

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2.5.4 Methods of Reducing Labor Costs
The key to reducing labor costs might be as follows:
1) Improving efficiency/productivity earlier.
2) Changing the method of work. A work study or organization and method
programme a might be set up to look for cost saving from improved work
methods.
3) Replacing humans with machinery. The substitution of labor by automatic
equipment might reduce costs substantially as the well published experience of the
newspaper industry showed.
2.6 THEORETICAL REVIEW
Research in management accounting has a long tradition with a variety of theories being
utilised and applied in the process (Scapens & Bromwich, 2010). Some of the main
theories, grand or meta-theories or more accounting or organization-specific theories
(Llewelyn, 2003), are outlined in this section.
2.6.1 Contingency Theory;
Contingency theory approach (Chapman, 1997; Chenhall, 2003; Scapens, 2006) which is
derived from organizational studies and says that the successful implementation and use
of management accounting practices depends upon particular factors, so-called
contingencies. These typically include the environment, technology, size and structure of
an organization. Contingency theory is still one of the most popular research approaches
in management accounting (Chenhall, 2006).
2.6.2 Institutional Theory
Institutional theory established tradition in management accounting research investigating
change in management accounting practices, with the earlier studies adopting New
Institutional Economics (NIE), Old Institutional Economics (OIE) and New Institutional
Sociology (NIS) (Burns and Scapens, 2000; Scapens, 2006) and recent studies having
developed the concept further to institutional logics (Rautiainen & Jarvenpaa, 2012; ter
Bogt & Scapens, 2009). Meyer and Rowan (1977) found that OIE and NIS support the
idea of homogeneity, that is everyone signs up to the same belief system within the
organisation, for instance budgeting takes place because external forces, be they coercive,
mimetic or normative, force the organisation to do so in order to gain legitimacy (Ma and

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Tayles, 2009; Moll and Hoque, 2011). In general, NIE focusses on the structures that
govern economic transactions, OIE is concerned with institutions that impact upon
thought structures of individual human agents, and NIS deals with the institutions that
shape organisational structures in the organizational environment (Scapens, 2006). An
institutional logic is a recent development of institutional theory, which reflects the idea
of heterogeneity. Heterogeneity occurs because individuals act on the basis of their
habitus (Bourdieu, 1977; ter Bogt & Scapens, 2009) but also on the basis of detailed
deliberation. Contrary to prior forms of institutional theory, institutional logics suggest
that an individual can make their own choices, although their internalized habits and
routines will guide such choices (terBogt & Scapens, 2009)_
2.6.3 Giddens' Structuration Theory
Giddens' structuration theory (Coad & Herbert, 2009; Scapens, 2006; Tillmann &
Goddard, 2008), which combines structure, the rules and resources of a society, and the
agents, in whose memories these rules and resources are embedded (Coad & Herbert,
2009). This is referred to as duality of structure (Tillmann & Goddard, 2008). In order to
manage within the structure, agents call upon their memories in order to perform three
possible outcomes on the basis of their knowledgeability: have power, assign meaning
and act according to norms (Coad and Herbert, 2009). Power is created through access to
resources; acting according to norms is based on the structure's rules (Giddens, 1979).
2.6.4 Bourdieu's Theory of Practice
Bourdieu's theory of practice (Bourdieu, 1977). Bourdieu refers to the field (i.e. structure)
and the habitus (the agents' knowledgeability), which interact and impact upon each
other. An individual is part of the field and adopts the rules and norms of the field into
their habitus, for example through education and experience (Bourdieu, 1977). Their
habitus, in turn, can adjust rules and norms if needed, and can change the field;
depending upon the sources of capital the individual possesses (Bourdieu, 1986). The
sources of capital determine the level of power an individual has, which include
economic capital, i.e. the amount of resources someone has available, social capital, i.e.
the level of influence and connections an individual possesses, cultural capital, i.e. the
level of education someone has completed and the level of knowledge someone
possesses, and symbolic capital, i.e. the prestige and honor an individual enjoys in their

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field (Bourdieu, 1986). The more capital an individual has access to, the more powerful
they are (Bourdieu, 1986).
2.6.5 Actor-Network Theory
Actor-Network theory originates from the sciences, and takes a new approach to
investigating relationships between actants, thus it is not really a theory but rather an
ontological approach that has been applied in accounting extensively (Justesen &
Mouritsen, 2011). It does not engage in how and why questions but rather seeks to
analyse the ties within a network, where a network can be comprised of humans and non-
humans (Ahrens & Chapman, 2006; Justesen & Mouritsen, 2011; Whittle & Mueller,
2010). The network with the strongest ties will be the most successful, thus deserves
attention (Whittle & Mueller, 2010).
2.6.6 Theory of Communicative Action
Theory of communicative action (Habermas, 1984, 1987), where the former argues that
within a societal structure there are four potential possibilities for crisis: economic,
rationality, legitimacy and motivation (Dillard & Yuthas 2006). Dillard & Yuthas (2006)
adopt this theoretical approach to the increasing popularity and implementation of
Electronic Resource Planning (ERP) systems within both organisations in general as well
as to a specific organisation, and argue that the increased adoption of ERP systems has
led to a crisis in the market managers have to deal with. The Theory of Communicative
Action is considered to be Habermas' most influential work and has received the most
application within accounting.

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C
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RESEARCH DESIGN
&
METHODOLOGY
Research design according to Abadella and Levin (1979) is concerned with the question
of how the study subjected will be brought into the scope of the research and how it will
be employed data. Research design could therefore be seen as frameworks or plans that
are used in collecting and analyzing the data for study. The study attempts to find out the
role professional accountants that are management accountants play in improving the
profit potential of manufacturing companies.
Since the various elements of the design of this study are not under the control of
the researcher the quasi experimental research design is adopted. This method will enable
us carry out an exploratory survey which is mainly what this study is all about.
Data for this study were generated from both primary and secondary sources.
The primary data were collected through oral interviewed questionnaires issued. These
questionnaires were down in such a way that they are close ended with a few open ended
questions. This is basically to afford the respondents the opportunity to answer the
question with minimum effect and time.
Another source from when the researcher obtained his primary data is through
observation techniques. This involves noting and taking recognition of the operations in
process especially the internal control system of the organization.
Some documents like the cash register note books money register were searched
through by the researcher to ascertain whether they actually carry out daily balances on
time.
Secondary from professional journal published locally by financial and management
accountant. Others are financial statement magazines newspaper and other texts.
All interviews were held at CDC situated in Bota Limbe Idenua. Some of the top
officers in the offices were interviews and also the supervisor the foremen and workers in
the field were interviewed.
The research questionnaires were distributed among the CDC staffs both the
officers and the workmen. Questionnaires are used to ensure that the respondents are not
debarred of time factor which is the main inconvenience of oral interviews. It is thus very

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convenient for any respondent who is interested. In this manner it attempts to ensure that
the short comings are made good by the other.
3.1 Sample Used
In all, twenty-two questions were asked to help the researcher know exactly what
role the management accountant plays in the significant good of profit maximization.
That is to find out if the employment of some management techniques and tools can
enhance profitability by the researcher. The questionnaires that were distributed were
collected personally by the researcher when all the interested respondents have responded
analyzed using simple percentage. This is simple to reduce the mass of data into a more
concept from which highlights general trend and relationship between variable.
3.2 Method of Investigation
The method of investigation adopted by the researcher in this research work was
interviews as well as consultant of relevant secondary sources of data.
The interview was conducted with officers who are in better position in the
organization and who can be able to tell how the affair of the organization is being
conducted generally.
On the other hand the questionnaires were structured in a way that valuable
information would be elicited from the respondent’s answers given.
3.3 Distribution of Questionnaires
The number of questionnaires distributed by the researcher was 15 in number
and out of these 15 questionnaires 13 of them was collected and 2 of them proved
uncollectable. The researcher then based his analysis on the 13 sets of questionnaires that
were returned.
3.4 Method of data analysis
There are several methods of data analysis, but for the purpose of this study the method
of data analysis is employed:
The Chi-square
3.4.1 The Chi-Square (X2
) Method

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Chi-square is denoted by the Greek letter X2
, pronounced as “Kye.” which has only one
parameter, that’s “the degree of freedom (v)”. The degree of freedom is the number of
independent variables used in calculating the test statistic. The test statistic is often
written as X2
and it’s subjected to certain conditions. The Chi-square is frequently used in
testing a hypothesis concerning the difference between a set of observed frequencies of a
sample anda corresponding set of expected or theoretical frequencies.

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C
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DATA PRESENTATION, ANALYSIS
&
DISCUSSION OF FINDINGS
4.1 Data Presentation and Analysis
In this chapter researcher shall present collected data and its analysis as stated in
the previous chapter. We shall also discuss on these data based on the research questions
we are attempting to answer.
As was stated in chapter three personal interviews was used to elicit information
from the top level management and also some questionnaires given to the entire
management level for data collection let’s start with questionnaires presentation and
analysis.
4.2 Data Classification
As earlier stated is sets of questionnaires distributed and 13 of them were returned this
represents 87% of the questionnaires distributed.
The response rate can be represented mathematically.
13 x 100%
15
= 1300
15
= 87%
Questionnaires not returned (100% - 87% = 13%)
Some questionnaires were not returned this represents about 13% of the distributed
questionnaires. The analysis is presented in form of pertinent question and has been
presented and analyzed in the data collection tables. Let us now progress with the
presentation and analysis of the questionnaires.

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Data Response in relation to general information
4.2.1 Question 1
TABLE I: Does the management of your company plan the business operations?
Response Frequency Percentage
Yes 13 100%
No - -
Total 13 100%
Source: Research survey (2021)
From the analysis of data relating to general information there was a 100%
agreement that manufacturing companies are involved in the planning of business
activities and operations. To do this effectively the analysis further revealed 100%
agreement that information is needed for the effective implementation and execution
planned activity.
Data analysis of response relating to activities of the management accountants
4.2.2 Question 2
TABLE II: Does the management accountant classify cost to provide information for
profit planning?
Yes 13 100%
No - -
Total 13 100%
From the data analysis relating to the activities of the management accountants
there appear to be a 100% response to the question the management accountant does
classify cost to enable project planning to take place.
Data analysis of responses relating to management accountant techniques
4.2.3 Question 3
TABLE III: What cost reduction techniques is in place in your company?

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Standard costing 9 69%
Marginal costing - -
Budgeting 4 31%
Total 13 100%
From the data analysis relating to management accounting techniques in use by
management accountant the standard costing techniques in use by management
accountant the standard costing techniques appear to be must popular among he
techniques mentioned above. This is as a result of its being practicable and easy to
understand. The budgeting technique is least followed in practice. The marginal costing
techniques remain unpopular.
Data analysis relating to maintaining cost structures.
4.2.4 Question 4
TABLE IV: Will the company’s fixed cost remain constant over the relevant range of
output?
Yes 13 100%
No - -
Total 13 100%
From the table above it is obvious that the fixed cost structure of the
manufacturing company’s remained fixed an agreed relevant range. The fixed cost
structure would permit for management decision involving viable investment in order to
maximize profit from scare resources. However there are limitations to the basic
assumption they include:
1. It is unlikely that fixed cost will remain fixed when there is for instance a
breakdown of plants and production has to continue this will involve an
incremental fixed cost.
2. Where by the volume of output exceeds the relevant range by one unit it depicts an
example of a stepped out situation then too fixed cost may not be fixed.

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Data Analysis for response relating to pricing policies
4.2.5 Question 5
Table V: Does good pricing lead to appropriate determination of profit?
Yes 9 69%
No 4 31%
Total 13 100%
Source: Table v response profile
From the table above 67% of the respondents agree that good pricing of product
often lead to the determination of profit while 31% of the respondents do not embrace the
view. Reasons for this could be:
1. Customers may not be able to buy at a price as high as was fixed.
2. There could exist discount conception.
3. There could be substitutes from which the customer would chose from data analysis of
responses relating to structure of reports.
4.2.6 Question 6

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TABLE VI: Does the system of management accounting given general information
supporting the significance of profit maximization?
Yes 13 100%
No - -
Total 13 100%
From the table analysis shows a 100% argument on the form of management accounting
report that give general information in order to support the significance of profit
maximization.
All manufacturing company would do well to present this report legibly.
4.3 Test of Hypothesis
The researcher have been able to obtain and analyze the data for this study, which
is now necessary to test the hypothesis as was stated in chapter one so that a definite
inference will be made based on the end result of the best.
4.3.1 Hypothesis One
The hypothesis is to test the extent cost are classified by management accountant to
provide useful information for profit planning. The relevant data for carrying out the test
of this hypothesis is the question eleven (ii) in the questionnaires that was distributed.
Ho: Cost reduction does not significantly affect profit maximization
H1: Cost reduction significantly affects profit maximization
The test technique to be used is chi-square which represented as i.e.
X2
= Chi-square
The formula for chi-square is: X2
= Σ (O-E) 2
E
Where:
X2
= chi-square
O = observed frequency

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E = expected frequency
∑ = summation sign
Operation assumption the level of significance is assumed to be 0.05
The formula for degree of freedom (v) = (R-1) (C-1).
Where
R = rows = 2
C = columns = 2
v = (2-1) (2-1)
v = (1) (1)
v = 1
Decision Rule
Accept Ho: If the calculated value of X2
is less than the critical value otherwise do
not accepts Ho
Experimentation
Chi-square Table
Responses O E (O-E)2
(O-E)2
/E
Yes 13 6.5 42.25 6.5
No 0 6.5 42.25 6.5
Σ 13 13 / 13
Computed value of chi square 13
Note: The expected frequency is determines by allocating 50% of the total response to
each of the response option.
X2
= Σ (O-E) 2
E
=13
Decision Making
X2
= 13
At 5% significant level X2
(5%) (1) Is found on the Chi-square table
X2
(5%) (1) = 3.84 and X2
=13
X2
< X2
that is 3.84 < 13

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So Ho is rejected.
Since X2
calculated is greater than X2
, we can now significantly reject Ho.
This means that Cost reduction significantly affects profit making.
4.3.2 Hypothesis Two
The second hypothesis is to test the extent to which the company’s fixed cost remain
constant over the relevant range of output. The relevant data for carrying out this test of
hypothesis is the question thirteen (13) in the questionnaires that was distributed.
4.3.3 Statement of Hypothesis
Ho: A Company’s fixed costs do not significantly affect profit maximization.
H2: A Company’s fixed costs significantly affect profit maximization.
Out test techniques is going to be chi-square represented as X2
.
The formula is
X2
= Σ (O-E) 2
E
Where:
O = observed frequency
E = expected frequency
E = summation sign
X2
= chi-square
Operative Assumption
We are going to assume a 0.05 (5%) level of significance.
The formula for degree of freedom (v) = v= (R-I) (C-I).
Where
R = rows which is 2
C = columns which is 2
v = (2-1) (2-1)
v = (1) (1)
v = 1

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Decision Rule
Accept H1: If the calculate value of X2
is less than the critical value otherwise do not
accept.
Experimentation
Chi-square Table
Responses O E (O-E)2-
(O-E)2
/E
Yes 13 6.5 42.25 6.5
No - 6.5 42.25 6.5
Total 13 13 13
Computed Value of Chi square 13
Note: Remember that the expected frequency is determines by allocating 50% of the total
response to each of the response option.
X2
= (13-6.5)2
+ (13-6.5)2
6.5 6.5
X2
= 42-25 + 42.25
6.5 6.5
X2
= 6.5 + 6.5
X2
= 13
From the calculated above we can see that:
X2
= 13
Decision Making
X2
= critical value = 3.84
X2
= calculated = X2
critical
Since X2
calculated is greater than X2
critical we reject Ho:
This is essence mean that the company’s fixed costs are always content over the relevant
range of output.

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C
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SUMMARY OF FINDING, CONCLUSIONS AND
RECOMMENDATIONS
5.1. Summary of Finding
The manufacturing company is normally referred to as the industries sector. The is
mainly because of the contributions it makes towards the gross national product (GDP) of
the nation the government after pays particular attention to this sector by way of
provision of grants and subsides as a sources of encouragement.
Since information can provided only when there are function type performed in an
organization the types of information need at any point in time is directly proportional to
the function to be performed at that time hence it is pertinent to know the function of the
management accountant in a manufacturing company whose information is provide for
the maximization of profit. In analysis the activities of the management accountant is
identified as one of the key officers of accounting department. There are certain function
he performs to be able to make available he required information.
The management accountant performs the function of providing information for
planning accounting decision making and evaluation of the company’s operation. In his
planning responsibilities he quantifies and interprets the effects of planned transaction
and other economic events of the organization. He also ensures the accountability of
resources of the company. He participates indirectly in the management process by virtue
of his duties manufacturing companies face problems such as cost classification cost
reduction and these problems emanate during production planning other problem like
those associated with product pricing are caused by the disposed off at a reasonable price
and at the right time to avoid over stocking and at inventory such that the company will
have enough to sustain production and at the same time maximize profit.
The company’s management wants these problems to be known because of the
allocation of appropriate cost of production in order to reduce cost and increase
productivities and efficiency. They therefore need information to solve these problems.
Also in order to allocate production cost appropriate the management accountant gets
involved in the classification of cost to provide information for profit planning and profit
maximization these costs are therefore classified into fixed variable and semi-various

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costs. Semi-variable costs are later separated into its components for further
classification. The management accountants performs this task just because he is skillful
in the art of accumulating analyzing verifying and interpreting of the cost data and those
from other sources there are contain management accounting techniques that he employs
of which the standard costing technique and the budgeting technique are the most
popular. The management accountant specifically uses the budgeting technique to
provide certain relevant information for profit planning. From the prepared budgeting the
management accountant observes the company’s financial situation in terms of cash
inflow and outlaw. With this technique the management accountant provide the
information for the control of the company’s operations. It can also be observed from the
budget whether the actual results of production are greater or less then what has been
budgeted. If there exist such discrepancy control is established on the area that caused the
adverse effect. Cash budget are pertinent to manufacturing companies since it shows at
any point in time the financial standard of the company. This therefore negates what
happen in the profit and loss account of the company which indicates a net profit at the
time of favorable condition and not loss at unfavorable conditions. The cash budget gives
indications of other danger or unhealthy conditions, since company can carry out
operation without cash. With such budget as revealed by it study manufacturing
companies are able to give information with which to conduct feasibility studies as to the
variability of its plan to achieve the profit maximization goal.
Another technique used by the management accountant is the standard costing
technique for the operation of the company. For example he oversees the standard of
material input Labor and overhead. This costing system fosters a compares of actual and
standard cost and where there appears a variance the management accountant investigates
the course. It is one thing the account analyzes and interpreter data in order to satisfy the
need of managerial information for purpose of profit planning activities of the company
and another thing to put down this information in an understandable manner. That is the
way the content of the repent will be constructed by all level of management so that all
information contained there will be useful.
The structure and preparation of the report is so important such that the management
could implement. The management accountant has to prepare a report with qualities
ranging from relevance time lines accuracy understand ability and aggregation. Where
one of the qualities is lacking the report becomes meaningless.

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Furthermore if a report is urgently need to solve a problem and the report is not
available as at the time it is needed of what value is such a report? It eventually becomes
useless to the management of company.
In the preparation of report certain factors are to be considered. Those are the
recipients of knowledge of technical terms numeric liter racy level of he user and the
characteristic group of people working with the management accountant. All these are
fully looked into to provide room for adequacy under the structure and preparation of the
report. If the report is not properly done the management would be hindered form getting
the appropriate information it needs.
On the strength of the findings and analysis of data there is revelation that accountants
have a lot to play in managing the affairs of the manufacturing company. From the
questions asked the researcher believes that management accountant is concerned about
meeting the top management level to exploit their service.
5.2 Conclusions
This research work took off on the premise of the role the management accountant
plays in the optimization of profit of manufacturing firm. The study revealed that the top
management of CDC a manufacturing company based in the SW region cannot plan and
control their day-today operational activities efficient without the very relevant
information from the management accountant concerning the problems confronting them.
The researcher can confidently and conveniently conclude that the management
accountant through the provision of specialized information gained from his knowledge
as a professional plays a prominent role in the maximization of the profit of
manufacturing outfits.
5.3 Recommendations
The following useful suggestions are proffered form the above findings.
1. Since business decision today guarantee the continuous existence of the business
and the effectiveness of the decision itself is a function of the information used in
reaching it we recommend therefore that every manufacturing outfit should employ
the services o a quantified management accountant.

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2. The management accountant should be provided with some other qualified
assistants to ensure at all times an uninterrupted and control. Such assistants
should equally posses a sound knowledge of accounting.
3. Although the management accountant is a middle level manager he should be
allowed to interpret the report he prepared to the management especially the
technical terms. The management on their part should be able to follow the report
to the later so as to get the most it can afford.
4. Information can only be useful if it is both relevant and timely manually general
information may be cheap but may not be timely therefore recommends a
computer based information system to quicken the pace of work analysis as data
error and undue delay in decision making will definitely hinder the firm’s goal of
profit maximization.
5. The world is a dynamic plan of experience. While this is true of all knowledge
therefore recommended here that the management of the company should give
adequate exposure to their management accountant as regards training
programmes as well as appraisal and evaluation seminars in order to acquaint them
with modem discoveries and make them keep pace with new knowledge.
6. I suggest that further research should be done on his topic. The entrepreneurs of
manufacturing companies should be interviewed so that the problems experience
by them relating to accounting and management can be looked into from their own
angle.

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