When you open a book which is relating to “Management”, normally you can find out below sentence.
“There are two kind of accounting in general, one is Statutory Account and another is Management Account.”
I do not think that this explanation is wrong.
Please imagine such concept that there exists quite big set namely “Accounting”, in which you can find out different two sub-sets, one is “Statutory Account” for book closing purpose, and another is Management Account.
However, because of the fact that Japanese translation of “Management Account” does not fit at the business front at all, there certainly exists some confusion.
One of the most frequent confusion would be that they would introduce too many codes for classification and would make so big spreadsheet with so much classified data.
Finally, they would fall down after totally being exhausted.
This is “Put a cart before the horse.”
Another example of confusion is to use the code of “common”.
What does it mean?
Originally, business activities inside the company is organically combined each other.
However, in accordance with the philosophy of “Management accounting”, several codes are implemented and “common” codes are not fitting towards such policy.
I personally believe that in case of real “Management account”, you will be required to prepare below described data to your management
➢ Reliable enough for management to make analysis
➢ Reliable enough for management to make decision
In case of Japan Agribio, we only have more or less 10 codes currently used in “Management account” which consists of
5 major crops we are now focusing
Additional targeted crop as “The 6th crop”
With Best Regards,