Challenges in advanced management accounting

Overview

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This free course, Challenges in advanced management accounting, focuses on strategic management accounting and selected concepts and techniques. It will help you to successfully navigate mid- to long-term challenges to creating sustainable organisations. This OpenLearn course requires a prior understanding of basic management accounting approaches.

Syllabus

Introduction
Learning outcomes
1 Strategic management accounting
1 Strategic management accounting
1.1 Defining strategic management accounting
1.2 Comparison of strategic and traditional management accounting
2 Strategic customer analysis
2 Strategic customer analysis
2.1 The customer selection decision
2.2 Determining customer profitability
2.2.1 Tracing of costs to customers
2.2.2 Applying Pareto analysis to customer profitability
3 Principles of project appraisal
3 Principles of project appraisal
3.1 Relevant cash flows and sunk costs
3.2 The time value of money, discounting and present value
3.3 Why does the value of money depend on time?
3.3.1 Underlying factors
3.3.2 Comparisons with other rates of return
3.4 Using the WACC as the discount rate for a project
3.5 Problems with using the WACC as the discount rate for a project
3.6 Using the CAPM to find a project-specific cost of equity
3.7 Problems with using the CAPM to find a project-specific cost of equity
3.7.1 Problems with using industry comparisons to estimate business risk and beta value
3.7.2 Problems with financial risk
3.7.3 Other problems with the CAPM calculation
3.8 Using a spreadsheet to model project evaluation
4 Dealing with risk and uncertainty in project appraisal
4 Dealing with risk and uncertainty in project appraisal
4.1 Risk and uncertainty
4.1.1 Attitudes towards risk
4.1.2 Attitudes towards uncertainty
4.2 Simple adjustments to deal with increased risk
4.2.1 Risk and the discount rate
4.2.2 Risk and the payback period
4.2.3 Risk and time delay
4.3 Using probability and future cash flows to deal with risk
4.3.1 Estimating future cash flows
4.3.2 Calculating probability-weighted cash flows instead of increasing the discount rate
4.3.3 Estimating probabilities for scenarios instead of increasing the discount rate
4.4 Modelling sensitivity analysis
4.5 The value of information
5 End-of-course exercises
5 End-of-course exercises
Conclusion
Glossary
References
Acknowledgements