The Fletcher School s1
Managerial Accounting
Summer 2013
Instructor: Lawrence Weiss
Office: Mugar 252e
Telephone, fax 617/627-2735, 3712
E-mail:
COURSE DESCRIPTION
Financing, production, and marketing decisions require facility with cost, revenue, and profit analyses. Strategic decisions typically require understanding how an organization’s cost and revenue structures compare with those of other organizations. The underlying objective of management accounting is to encourage an informed use of internal accounting information for such decisions.
This course goes beyond the traditional accounting model to integrate concepts from other disciplines, particularly economics, quantitative methods, behavioral science, and policy and strategy. Our emphasis will be on how to use accounting information for managerial decision-making purposes as opposed to the external disclosure focus of the financial accounting course. We will cover the basic vocabulary, concepts, procedures and mechanics of managerial accounting, the design of management accounting systems for different operations, and the role of management accounting information in organizational operations.
Unlike financial accounting, there are no set rules or regulations dictating how organizations should gather or report information used for decision making and control. We will examine and evaluate different firm’s methods of data accumulation and interpretation, with particular emphases on product/service costing and management control. Examples from the for-profit, not-for-profit, and governmental organizations will be used.
Readings and Cases
We will use a set of readings and cases that are made available in the course package and on Blackboard. The required textbook is Management Accounting by Garrison, Noreen, and Brewer, 14th edition, McGraw-Hill Irwin (ISBN 978-0-07-811100-6). You are encouraged to discuss all the cases in groups, but for certain cases you will be required to individually submit a one page case write. I also encourage you to keep abreast of the developments in the fast-paced and changing business world by reading the business press (the Wall Street Journal) regularly and keeping track of important events and emerging trends. Please also read the international business press, (the Financial Times and the Economist). During the course you may be requested to comment on matters that have received wide press coverage.
Course Requirements and Grades
Contribution to the class 10 percent
Case write ups 20 percent
Mid-term 30 percent
Final Exam 40 percent
The exam is closed book but you are allowed to bring one, letter size, sheet of paper (with one or two sides written on). The case write ups can be discussed with classmates but each participant must then submit their own final version. They are due by 6 PM the night before the class when the case will be discussed. You should email the one page write up to the course TA (not to the Professor).
Expectations
I will cold-call students in each class, and note your contributions daily. Please remember to bring your name card and have it in front of you. If you are unprepared for a class, please tell me (the reason doesn’t matter) so that I don’t call on you; one such “pass” does not adversely affect your class participation grade. Classes will start and end on time. Please arrive and be ready on time, and please do not leave the room during the class. Please turn off cell phones.
Teaching Methods
Much of what we will do in this course is common sense – which of course is only common once you see it. The best way to learn the material is to gain experience through problem solving. During the course we will spend a substantial amount of time applying the material covered in the class on real world managerial issues. Each session will normally involve a lecture and an analysis of a case study or exercises.
The case studies have been selected to raise substantive questions in the design and use of management accounting and control systems. You should be prepared to present and discuss each case in class. The questions you should address on each case will be included on a separate page in the course package or distributed in class. These supersede any questions show on the case studies themselves.
Tentative Course Outline – (subject to revision)
# Topic Material
1. Introduction GNB-C1
The Nature of Costs GNP-C2
2. Relevant Costs Case – Alpha Metals (Case write up due)
Job Order Costing GNB-3
3. Job Order Costing GNB-3
Process Costing GNB-4
4. Costing Systems Case - Seligram (Case write up)
Activity Based GNB-7
5. Activity Based Case – Cooperative Bank (Case write up)
Review Practice Exam
6. Mid-Term Exam
7. Cost-Volume-Profit GNB-5
Case – Baldwin Bicycle
Variable Costing GNB-6
8. Control – Budgeting GNB–8
Kerr, Steven, On the folly of Rewarding A, while hoping for
B, 1995 Academy of Management Executive, Vol. 9, No. 1
Kaplan, R. S. and D. P. Norton, “The Balanced Scorecard –
Measures that Drive Performance", Harvard Business
Review, January/February 1992, pp. 71 - 79.
9. Control Variances GNP-9
GNP-10
10. Corporate Structure GNB-11
Case - Birch Paper (Case write up)
11. Capital Budgeting GNB-12
GNB-13
12. Final Exam
GNB is the Managerial Accounting text by Garrison, Noreen, & Brewer
E = exercise, P = problem, & C = case
Cases in italics will be in the course package or on the BB.
About Your Professor:
Academic training
· Doctorate of Business Administration, Harvard University
· M. B. A., McGill University
· Diploma of Public Accounting, McGill University
· Bachelor of Commerce, McGill University
Interest Areas
· Corporate Bankruptcy
· Financial Accounting
· Management Accounting
· International Accounting
Biography
Born and raised in Montreal Canada, Professor Weiss began his career as a Canadian Chartered Accountant (equivalent to a CPA in the US) working for KPMG. He received his undergraduate degree in Accounting and his MBA in General Management from McGill University. Larry earned his Doctorate in Accounting and Control from the Harvard Business School.
Prior to coming to The Fletcher School, Professor Weiss served on the faculties of McGill University, Babson College, Tulane University, INSEAD, M.I.T., HEC Lausanne and Georgetown’s McDonough School of Business. He has also taught at IMD, the London Business School, Rochester/Bern, the Helskinki University of Technology, KREMS and CEIBS. Larry received the teacher of the year award at MIT and has been nominated for best Professor at Fletcher, INSEAD and Tulane University.
Professor Weiss' research focuses on three themes. The first is the reorganization of financially distressed firms. He is a recognized expert on US corporate bankruptcy, and has testified before the US Congress on bankruptcy reform. The second is how managers gather and use information for decision making. The third is the transition from country specific accounting standards (Local GAAP) to one set of global standards (IFRS). He has over 40 publications, including: The Journal of Financial Economics; The Journal of Law Economics and Organizations, The International Journal of Operations and Production Management, The Journal of Applied Corporate Finance; Financial Management, The Journal of Legal Economics; The American Bankruptcy Law Journal; Bankruptcy Developments Law Journal; Regulation; several trade journals and newspapers (including The New York Times and the Financial Times); numerous cases (published at Harvard and INSEAD); and a book published by Cambridge University Press. His work has been cited over 500 times and he has won the All Star Paper award from the Journal of Financial Economics.