Managerial Accounting at Aon

Managerial Accounting at Aon

Sonia Sapp-Jones

BUS630 Managerial Accounting

Instructor Badley

June 9, 2014

An organization has two reporting needs that require financial information; financial accounting and managerial accounting. Schneider stated that financial accounting is the branch of accounting that organizes accounting information for presentation to interested parties outside of the organization. These reports must follow the guidelines set up known as generally accepted accounting principles (GAAP). Financial accounting reports consist of the balance sheet, the income statement and the statement of cash flows. The balance sheet is a summary of assets, liabilities, and shareholders’ equity for a specified period of time. The income statement measures the organization financial performance over a specified accounting period. “The statement of cash flows demonstrates how changes in balance sheet accounts and income affects cash and cash equivalents, and breaks the analysis down to operating, investing, and financing activities.” (Shim & Siegel, 2012). Managerial accounting is defined by the National Association of Accountants (NAA) as the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of financial information.

Managerial accounting assist the organization’s managers in making business decisions. Segments of the organization and the organization as a whole is the focus of managerial accounting. Managerial accounting is an internal business function that identifies, measures, records, and analyzes financial information. Managerial accounting does not follow national accounting standards, therefore ethics is an important part of managerial accounting. The quality of accounting information can be affected by noncompliance with professional ethical requirements. Organizations have developed a code of ethics to set the expected ethical behavior for accountant based on the...