Management Information (Standard)

A. Cost accounting 30% 1 Introduction to cost accounting (a) Describe the purpose and role of cost accounting within an organisation considering the following: (i) Definition of cost accounting; (ii) Purpose of cost accounting; (iii) Role of cost accountants; and (iv) Advantages and disadvantages of cost accounting. (b) Differentiate between cost accounting and financial accounting. (c) Outline the managerial processes of planning, decision making and control. (d) Explain the concepts of strategic, tactical and operational planning. (e) Differentiate between cost data and information. (f) Explain the attributes of good information. Ascertain cost of a product or service using different costing methods and techniques Compute the minimum volume of a product or service to be sold in a period to meet a specific profit target Assess the challenges posed and opportunities offered by electronic business and electronic commerce and management solutions Explain the roles of accountants in management information and system development Identify ethical, social, and legal issues in the design and use of information systems REGULATIONS AND EXAMINATIONS SYLLABUS FOR ICAN 38 2 Cost classifications, codification, segregation and estimation (a) Cost classifications (i) Explain the meaning of cost classification. (ii) Explain the different classifications of cost. (iii) Describe different types of cost behaviour using graphical illustrations. (b) Cost codification (i) Define cost codification. (ii) Explain the principles of a coding system. (iii) Explain and illustrate the use of codes in categorising transactions. (c) Cost segregation and estimation (i) Explain the meaning of cost segregation and cost estimation. (ii) Explain the structure of linear functions and equations. (iii) Demonstrate the use of the following cost segregation techniques: ❖ Industrial engineering; ❖ Account analysis; ❖ Scatter graph; ❖ High/low analysis; and ❖ Regression analyses. (iv) Calculate and explain simple correlation coefficient. 3 Accounting for cost elements (a) Accounting for inventory (i) Describe the different procedures and documents necessary for material management: ❖ Ordering; ❖ Purchasing; ❖ Receiving; ❖ Storage; and ❖ Issuing. (ii) Explain inventory management and control procedures. (iii) Identify, explain and calculate relevant inventory costs. (iv) Compute optimal re-order quantities (involving quantity discounts). (v) Explain and calculate the value of closing inventory and material issues to production using LIFO, FIFO and average methods. (vi) Explain Just-In-Time (JIT). (b) Accounting for labour (i) Explain labour recording and monitoring procedures. (ii) Determine direct and indirect costs of labour. (iii) Describe different remuneration methods: time-based systems, piecework systems, and individual and group incentive schemes. (iv) Determine the level and ascertain the causes and costs of labour turnover. (v) Prepare and explain the entries in payroll accounting. REGULATIONS AND EXAMINATIONS SYLLABUS FOR ICAN 39 (c) Accounting for overheads (i) Explain the components of overheads. (ii) Distinguish amongst allocation, apportionment and absorption of overheads. (iii) Describe the bases of overheads apportionment. (iv) Apportion and re-apportion overhead costs between production and service centres (including using the reciprocal method where service cost centres work for each other and simultaneous equation method). (v) Describe the bases and procedures involved in determining production overhead absorption rates. (vi) Explain and calculate under- and over-absorption of overheads. (vii) Explain activity-based costing. 4 Costing methods (a) Explain types of costing methods and compile cost using: (i) Specific order costing of: ❖ Job costing; ❖ Batch costing; and ❖ Contract costing. (ii) Process costing ❖ Determine the cost of a unit of output where there is normal loss, abnormal loss and abnormal gain. ❖ Prepare process accounts (including accounting for normal loss, abnormal loss and abnormal gain). ❖ Explain the concept of equivalent units. ❖ Determine the value of complete units and work-in-progress (WIP) using weighted average and FIFO methods. ❖ Differentiate between by-products and joint products. ❖ Estimate the value of by-products and joint products at splitoff point (the point of separation). (iii) Service costing ❖ Identify situations where the use of service/operation costing is appropriate. ❖ Illustrate suitable unit cost measures that may be used in different service/operation situations. ❖ Carry out service cost analysis in simple service industry situations. 5 Costing techniques (a) Explain the various types of costing techniques. (b) Prepare an income statement and determine the profit or loss under absorption and marginal costing. (c) Describe the advantages and disadvantages of absorption and marginal costing. (d) Reconcile the profits or losses computed under absorption and marginal costing. REGULATIONS AND EXAMINATIONS SYLLABUS FOR ICAN 40 B. Forecasting, budgeting and decision making 20% 1. Forecasting techniques (a) Explain the principles of time series analysis (cyclical, trend, seasonal variation and random elements). (b) Explain the advantages and disadvantages of time series analysis. (c) Calculate moving averages; use trend and seasonal variation (additive and multiplicative) to make budget forecasts. 2. Budgeting (a) Explain the importance of budgeting system. (b) Describe the stages in the budgeting process. (c) Explain the importance of principal budget factor. (d) Prepare simple functional budgets. (e) Prepare simple cash budget. (f) Prepare simple master budget. 3. Basic variance analysis (a) The purpose and principles of standard costing Identify types of standard and calculate the following basic variances: i. Direct material price and usage; ii. Direct labour rate and efficiency; iii. Variable production overhead expenditure and efficiency; iv. Fixed production overhead expenditure and volume; and v. Sales price and volume. (b) Explain possible causes of the variances. 4. Cost-Volume-Profit (CVP) analysis (a) Explain the concept of cost-volume-profit analysis. (b) Calculate break-even point, margin of safety and target profit for a single product. (c) Prepare and explain break-even chart (traditional approach, contribution approach, profit/volume approach). (d) Explain the limitations of cost-volume-profit analysis. 5. Decision-making (a) Explain the concept of relevant cost and revenue. (b) Explain the concept of limiting factor. (c) Describe short-term decision-making situations involving make or buy decisions using relevant cost approach. (d) Explain and calculate optimal resource allocation to a product or service based on the concept of limiting factor (single constraint/bottleneck). REGULATIONS AND EXAMINATIONS SYLLABUS FOR ICAN 41 C. Information systems and electronic business technologies 10% 1. Information systems (a) Define and explain information system (b) State the approaches to information systems (c) Explain the usefulness of information systems to some key business functions (i) Sales and marketing (ii) Manufacturing and production (iii) Finance and accounting (iv) Human resources (v) Office management • Describe the relationship among organisations, information systems and business processes. • State and explain the following classifications of information systems: ❖ Executive support systems (ESS); ❖ Management information systems (MIS); ❖ Decision support systems (DSS); ❖ Knowledge management systems (KMS); ❖ Transaction processing systems (TPS); and ❖ Office information systems (OIS). • Discuss the following aspects of management information system: ❖ Ethical, social and political issues; ❖ Proprietary information privacy and violation issues; ❖ Violation of intellectual property rights; and ❖ Legal redress for information privacy violations. 2. Electronic business and e-commerce (a) Discuss the following concepts in relation to e-Commerce: i. IT infrastructure requirements for e-commerce/eBusiness; ii. The internet as the backbone for e-Commerce; iii. Internet of Things or Internet of EveryThing (IoT/IoET); iv. Social media platforms; v. E-Commerce models—B2B, C2B, B2G, B2C, M-C; vi. Payment systems including mobile payment platforms; and vii. Digitisation of the middle-man with examples such as Amazon, eBay, Konga, JiJi, etc. (b) E-Commerce security Explain: i. Concepts of cyber threats and risks; ii. Cyber-attacks and its variants; iii. Protection mechanisms; and REGULATIONS AND EXAMINATIONS SYLLABUS FOR ICAN 42 iv. Cyber deviants and implication in the workplace. (c) Management issues associated with e-commerce/e-business Explain: i. Business case scenarios for firms’ e-commerce proposition; ii. IT Policies as stepping stone into e-commerce and e-business; iii. Making choices for e-commerce/e -business deployment; iv. Benefits and challenges of e-commerce and e-business; v. Business operations outsourcing methodologies; and vi. Data centre disaster and contingency plans/recovery alternatives. D. Computer hardware, software and data life cycle 10% 1. Computer hardware concepts Explain: i. Storage devices; ii. Network technologies — explaining the concepts and typologies; iii. Communication protocols; iv. Wireless networks; v. WWW and the internet; and vi. Intranets and extranets. 2. Computer software concepts Explain: i. Types of software — systems and application; and ii. Application bugs and treatment. 3. Data life cycle and information storage 4. Key data life cycle terminologies Explain the following: i. Data acquisition; ii. Data cleansing and processing; iii. Data analysis; iv. Data privacy and protection; v. Database management system; vi. Data warehousing; and vii. Big data analytics. E. Technologies supporting business processes 10% 1. Explain the concepts of: a. Enterprise resource planning (ERP); b. Artificial intelligence systems; and c. Blockchain technology. 2. Computer robotics and business automation (CRBA) REGULATIONS AND EXAMINATIONS SYLLABUS FOR ICAN 43 a. Business applications of CRBA: Explain: i. Customer relationship management (CRM); ii. Warehouse management; iii. Enterprise content management; iv. Supply chain management; and v. Virtual reality. b. Explain the following concepts in relation to management of information (MoI) system supporting business processes: i. Online transaction processing; ii. Centralised and decentralised processing; iii. Distributed processing; and iv. Real-time processing. F. Information system development and security 10% 1. Systems development methodologies Explain: i. The system development life cycle (SDLC); ii. Structured systems analysis and design methodologies; and iii. Agile systems development methodologies. 2. System security and controls Explain: i. Internal and external aggressions against information processing facilities (IPF); ii. Abuses and system vulnerabilities; iii. Organisational insider threats — deviant employees; iv. IT security policy and implementation; v. Simple baseline protection mechanisms including, use of passphrases, anti-virus protection, etc.; vi. Data privacy and data protection principles; vii. Perimeter protection systems such as use of firewalls and other penetration protection devices; viii. Concepts of disaster and recovery strategies; ix. Digital forensic methodologies; and x. Public key infrastructure (PKI) protection tools. 3. Explain ethical considerations in information technology REGULATIONS AND EXAMINATIONS SYLLABUS FOR ICAN 44 G. Disruptive technologies and applications 10% Explain the following concepts of disruptive technologies: (a) Digitisation in a business environment – principles and technologies; (b) Cloud computing (principles, technologies, benefits and risks); (c) Internet of things (IoT); (d) Artificial intelligence, machine learning and drones applications in business; (e) Virtualisation; (f) Statistical modelling; and (g) Blockchain and Fintech applications.