Managerial Accounting: An Important Tool for Executive Officers of Private Vocational Educational Institutions

Abstract

Nowadays, competition among many public institutions is tending to become even stronger, even in the education sector. This is particularly true for private vocational educational institutions. It is the view of the authors that the chief executive officers of such institutions should be aware of managerial accounting as a tool for managing their institutions effectively. This paper provides data to support this view. Managerial accounting can support all four management functions: Planning, Directing, Controlling & Evaluation and Decision Making. The support is in the 9 practices of managerial accounting: 1) Budgeting, 2) Capital Budgeting, 3) Responsibility Accounting, 4) Activity-based Costing, 5) Cash Flow Management, 6 Unit Cost Control, 7) Variance Analysis, 8) Balanced Scorecard Assessment, and 9) Using Cost in Decision Making. When these nine practices are employed, private vocational education executives are better able to provide the financial resources needed for quality teaching and learning. Ultimately, students will be the primary beneficiaries.