EVOLUTION OF MANAGEMENT ACCOUNTING: ESSENCE AND PRINCIPLES

Abstract

The article examines the theoretical and methodical aspects of the organization of management accounting, taking into account the conceptual-methodical and evolutionary aspects. The role of management accounting in the process of developing and making effective management decisions has been studied. The purpose of the article is to study the evolution of management accounting and generalize the approaches of domestic and foreign scientists to define the concept of management accounting. A well-structured and effectively functioning information system at the enterprise, which ensures effective management thanks to the use of reports prepared based on this system, is based on management accounting. The essence of management accounting is providing information that supports the implementation of the management process at its various levels. The demand for financial information from the management accounting system results from different decision-making and control situations arising under certain management conditions. Without it, rational management of the enterprise would be impossible. As a result of the conducted research, it was found that the introduction of management accounting at enterprises provides a complete picture of the enterprise's financial state and contributes to the adoption of effective and quick decisions. Thus, specific approaches of scientists regarding the interpretation of the concept of "management accounting" have confirmed that such accounting provides informational support to managers in decision-making, economic planning, and control over the implementation of the plan. Investigating the evolution of management accounting, it was found that it began to function in the 1970s. Its implementation at enterprises in those days contributed to changes in their organizational structures, which allowed companies to adapt to new operating conditions and stimulated the development of a new concept of development. It is also worth noting that management accounting is not mandatory at the moment, but is regulated independently by the management staff. Those enterprises that effectively use management accounting capabilities direct their efforts to find strategies for achieving business goals and choosing the most acceptable alternatives.