Organization of the management accounting information in the context of the corporate strategy

Lyudmila Mihaylova, Emil Papazov


Purpose. The purpose of this report will be to examine the relationship between strategic decisions and cost management in Bulgarian small and medium-sized enterprises, emphasizing the role of accountability in relation to the implementation of а strategy, as well as offering practical solutions.

Methodology. To achieve the purpose of the paper, following basic methods will be used: the method of analysis and synthesis; methods of the descriptive statistics, the comparison method, the case method. The collected information will be processed with the Microsoft Excel data tables.

Results. The paper will be focused on the need for consistency and comparability in the information flows between the financial and the management accounting. Their smooth go must be secured by a reporting organization, corresponding to the strategic orientation of the enterprise. In this connection, it will be necessary to carefully approach the development of the accounting policy on the basis of a coherence in the efforts of the chief accounting (or financial) officer and the executive director. In the absence of such a coherence in their actions, the processing of accounting data for management purposes will be complicated. As a result, the potential for cost optimization as an important precondition for a successful price competition will be diminished.

Following such an approach, the accountability will become a part of the tools for strategic management and the repercussion of strategic solutions on cost management will be turn to be one of the main challenges for managers. Moreover, the evaluation of accountability in a company will be based on its impact on the implementation of the corporate strategy.

The theoretical contribution. The results and findings appearing in this paper in a more elaborated and depth form will enhance the methodology for corporate strategic planning connecting it to the management reporting of small and medium-sized businesses.

Practical implications. The results stemming from this research paper can find a place or be further developed in the management practice of the small and medium-sized enterprises.

Keywords: strategic management, SMEs, accountancy.

Paper type: Research paper.


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