Abstract
The concept of value-based management is one of the newest cost management technologies of an enterprise. Purpose of this paper: to justify that value-based management accounting and analysis will allow creating an information base for understanding the result of an enterprise activity from the standpoint of the actual value growth. Results: using the methods of analysis, the authors defined the concepts of value-based management accounting and analysis, and revealed their advantages as compared with the financial indicators of an enterprise organization for performance evaluation. Research applications: senior management and company managers can use the results achieved in this study for the effective development of an enterprise.
Highlights
The development trends of managerial and organizational models in modern business indicate that the effective business replaces extensive business
The development of a management accounting system should necessarily be accompanied by creating a management analysis system since they constantly interact with each other and exchange information
Both management accounting and analysis should be adjusted to value-based management (VBM) goals
Summary
The development trends of managerial and organizational models in modern business indicate that the effective business replaces extensive business. The profit rate, previously used as a universal indicator of an enterprise’s activity purpose, has been recently replaced by more complex indicators. The primary indicator characterizing their activities is the increase in the company’s value. The concept of value-based management (VBM) is one of the newest cost management technologies successfully applied and developing in foreign companies. The market economy development, the organizational structure complexity increasing, and the growth of organizations, the increased level of uncertainty, the need for effective ways of overcoming crisis phenomena necessitated the adaptation of cost management technology to the Russian management traditions; recent research suggests that little is known about this [2, 3]
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