New Developments Aim to Build a Stronger Management Accounting FoundationTax Professionals' Resource
February 21, 2014 — 1,449 views
Chartered Institute of Management Accountants (CIMA) and American Institute of CPAs (AICPA) have proposed a comprehensive framework that helps companies make better and faster decisions with a long-term view in today's evolving, complex and competitive business landscape. The management accounting framework is expected to further fortify the foundation of the CGMA designation, and equip management consultants with more knowledge and insights needed to drive the success of organizations and people.
Titled 'Global Management Accounting Principles', the draft framework is open for consultation, and seeks feedback from businesses and institutions (public and private) across the globe. The deadline for the consultation is 10 May, 2014.
What does the framework propose?
The current draft provides an overview of the qualities and values that define the best practices of management accounting on a global scale. This includes advice on preparing relevant information, creating value models, communicating powerfully and establishing management accountants' professional value. It also incorporates a diagnostic tool that assists companies in leveraging key information in the most efficient way.
A robust management system encompassing financial reporting is necessary for organizations to build a successful future over the long term. There is also a need for management accountants to make smart decisions that enable greater trust in investors, customers and the public. CFOs, non-executive directors and senior finance professionals can benchmark the framework against their processes and practices to identify areas of improvement. The draft principles will allow organizations to utilize financial and non-financial data for a forward-looking, laser-beam focus.
The consultation will spread its wings to AICPA and CIMA networks across 177 countries. To meet their goal of further strengthening the CGMA designation, which was launched as early as 2012, the two institutes are planning a series of meetings, employer roundtables and events both nationally and internationally. The business community has already started showing its support for the draft.
Updated CIMA syllabus
An updated CIMA syllabus was launched in the beginning of February. It intends to bridge the skills gap of finance professionals worldwide, to continue maintaining the value of the CGMA designation, and address the employability requirements of people and businesses. A case study assessing the competencies outlined in the framework will be launched in January next year. It will be mandatory for CGMA candidates to clear the exam and satisfy practical experience requirements, to be awarded the designation.
The new developments will support organizations' goal of sustainable growth and value creation in a real and meaningful way.