Abstract In this article the author presents an analysis of management accounting today and its prospects in future. According to the author management accounting today is built largely on concepts, techniques, and measurement principles that were firmly established by 1960. Managerial cost accounting has essentially the same scope as management accounting because few managerial uses of cost data are limited to cost considerations alone. Here he examines the major criticisms that have been directed at the costing systems incorporated in management accounting and attempts to identify the actions practitioners and teachers will have to take to make managerial cost accounting a vital part of the management process as the 21st century approaches. Some of the doubts raised about the practice of management accounting are that costing systems in job order production require excessive tracing of costs to Individual jobs, costs that are driven by variables other than production volume are apportioned to products by volume-based rates, and that accounting textbooks have focused too strongly on short-term variable costs, overlooking the impact of capacity costs on strategically oriented product decisions.
Gordon Shillinglaw (Fri,) studied this question.