Management accounting and its external environments

Abstract

The internal operating environment of a firm is, or should be driven by, the external relationships the organisation explicitly engages in such as its customers, suppliers, or financial institutions, or is implicitly engaged with including competitors, government regulation, community and the need for social responsibility. This is because the internal environment is the result of the business activities an organisation undertakes and the quality of the outcomes it desires by engaging in these relationships. Thus, the focus of this book is on understanding and accounting for the explicit and implicit external relationships an organisation engages in. The specific focus will be on how the performance of these external relationships and their associated business risk might be managed and controlled for in the internal operating processes and activities of the organisation.