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Cornerstones of Managerial Accounting, 3rd edition
Mowen/Hansen/Heitger
Chapter 1Glossary Terms & Definitions
Certified Internal Auditor (CIA) The CIA has passed a
comprehensive
examination designed to ensure technical competence and has two
years
experience.
Certified Management Accountant (CMA) A certified management
accountant
has passed a rigorous qualifying examination, met an experience
requirement,
and participates in continuing education.
Certified Public Accountant (CPA) A certified accountant who is
permitted (by
law) to serve as an external auditor. CPAs must pass a national
examination and
be licensed by the state in which they practice.
Continuous improvement Searching for ways to increase the
overall efficiency
and productivity of activities by reducing waste, increasing
quality, and reducing
costs.
ControllerThe chief accounting officer in an organization.
Controlling The managerial activity of monitoring a plans
implementation and
taking corrective action as needed.
Decision making The process of choosing among competing
alternatives.
Ethical behaviorChoosing actions that are right, proper, and
just.
Financial accounting A type of accounting that is primarily
concerned with
producing information for external users.
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Lean accounting An accounting practice that organizes costs
according to the
value chain by focusing primarily on the elimination of waste.
The objective is to
provide information to managers that support this effort and to
provide financial
statements that better reflect overall performance, using
financial and
nonfinancial information.
Line positions Positions that have direct responsibility for the
basic objectives of
an organization.
Managerial accounting The provision of accounting information
for a companys
internal users.
Planning A management activity that involves the detailed
formulation of action
to achieve a particular end.
Publicly traded companies Companies that issue stock traded on
U.S. stock
exchanges to which the Sarbanes-Oxley Act applies.
Sarbanes-Oxley Act (SOX) Passed in 2002 in response to
revelations of
misconduct and fraud by several well-known firms, this
legislation established
stronger governmental control and regulation of public companies
in the United
States, from enhanced oversight (PCAOB), to increased auditor
independence
and tightened regulation of corporate governance.
Staff positions Positions that are supportive in nature and have
only indirect
responsibility for an organizations basic objectives.
Total quality management A management philosophy in which
manufacturers
strive to create an environment that will enable workers to
manufacture perfect
(zero-defect) products.
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TreasurerThe individual responsible for the finance function;
raises capital and
manages cash and investments.
Value chain The set of activities required to design, develop,
produce, market,
and deliver products and services to customers.
