The British Standards Institute (BSI) has published the first standard for management accounting, which has been sponsored by CIMA and is designed as a best-practice guide and framework
The PAS 1919: 2016 guide to management accounting principles was developed with input from organisations including the Environment Agency, NHS, Fujitsu and Siemens.
David Fatscher, head of market development for sustainability and Services at BSI said: ‘CFOs have much more reporting responsibility than they once did and the management accounting function is now an integral part of an organisation's strategic planning. PAS 1919 outlines the key principles and activities they have to deliver on to assure stakeholders of sustainable business performance.’
The PAS sets out four outcome-based management accounting principles and provides a basis on which organisations can set their own benchmarks for the management accounting function.
The four principles cover the following:
- communication provides insight that is influential – encouraging insightful communication that drives better decisions across an organization;
- information is relevant – reviewing past, present and forward looking performance management information;
- impact on value is analysed – understanding an organisation’s strategy and business model; and
- stewardship builds trust – balancing short-term commercial interests against long term value for stakeholders.
Tony Manwaring, CIMA’s executive director, external affairs, said: ‘This sets the standard for decision making around the world. The content of PAS 1919 represents best practice management accounting and enables organizations to take decisions that drive value in the short, medium and long-term.’
This PAS is for use by large, small, public, private, local and international organisations and investors or other stakeholders. Some of the other organizations involved in the development of PAS 1919 include: Cummins, Hymns Ancient & Modern Ltd., International Federation of Accountants (IFAC), Johnson Electric, Mevis Medical Solutions AG, Pentland Brands, Royal Botanic Garden Edinburgh and Sky plc.
The PAS 1919: 2016 guide to management accounting principles is available for £80 via the BSI website
