BSI launches management accounting standard

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In a move that surprised many within the profession the standards company BSI has published PAS 1919, a best-practice guide to management accounting.

Sponsored by CIMA and with input from an international steering group that includes IFAC, the publicly available specification (PAS) is a voluntary guide designed to define what “good” looks like for in-house accounting.

The move marks BSI’s first foray into accounting, although the organisation previously published British Standards on organisational governance and behaviour. PAS 1919 aims to give companies a framework to support their decision making and contribute to overall performance improvement.

Introducing the standard, BSI head of market development for sustainability and services David Fatscher said: “CFOs have much more reporting responsibility than they once did and the management accounting function is now an integral part of an organisation’s strategic planning.

“PAS 1919 outlines the key principles and activities they have to deliver on to assure stakeholders of sustainable business performance.”

The guide is available to download at a cost of £80. Nick Fleming, market development manager at BSI, told AccountingWEB that organisations of “any type and size” could get benefit from the PAS.

“In terms of who it might be aimed at within the organisation”, said Fleming, “it’s going to be someone in a management accountancy function, someone in the senior management team. So we’re seeing this as a type of standard that would have strategic application.”

What does the PAS cover? 

PAS 1919 gives guidance for organisations on assessing the performance of the management accounting function. It covers the four management accounting principles:

  • Communicating insight that is influential – insightful communication drives better decisions across an organisation
  • Information is relevant – reviewing past, present and forward looking performance management information
  • Impact on value is analysed – understanding an organisation’s strategy and business model
  • Stewardship builds trust – balancing short-term commercial interests against long-term value for stakeholders.

AccountingWEB contributor and financial reporting expert Steve Collings said that he could see the use of the PAS in defining what “good” looks like and being able to compare one company to another in a more uniform way. However, he was concerned about how useful the standard would actually be, particularly to smaller or more complex organisations.

“While statutory accountants follow UK GAAP, management accounts can follow all sorts of internal policies,” said Collings. “They’re very much ‘entity specific’. Organisations have been doing management accounts for years – why would they change? There are just too many variables at play to make it a fundamentally useful tool.”

While many may be familiar with BSI’s British Standard kitemark for best practice and international ISO standards, the PAS is seen as a “fast-track” standard – a more agile way of getting a document into the market.

Although it is still developed through consultation by committees or steering groups from industry – experts, academics, government and so on – the PAS format can be developed for fast-moving areas or where there’s a real demand to get a footprint down in a market.

PASs are often seen as a first step towards attaining an ISO, but general interest is likely to dictate whether this management accounting standard makes the grade.

Do you think this standard will help your business establish best practice? If not, what could be included?

About Tom Herbert

Tom is editor at AccountingWEB, responsible for all editorial content on the site. If you have any comments or suggestions for us get in touch.


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By jlsmith
06th Apr 2016 10:16

Classic comment

"Organisations have been doing [insert what they've been doing] for years – why would they change?"

You're right.  Why bother?

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By jlsmith
06th Apr 2016 10:18


Apologies for the double post

I think the first thing CIMA should be doing, if they want this standard to be taken seriously, is to make the standard available for free on their website.  Putting an £80 price tag just to read it will not encourage adoption.

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By tom123
06th Apr 2016 13:04

£8 and I might have bought it

£8 and I might have bought it - but, if one thing working life has taught me, it is that there is no one size fits all.

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06th Apr 2016 14:09

Useful questions

Agreed that the price tag is prohibitive. However, if the standard encourages us to look beyond the numbers and instead ask whether the reports are telling the right story to the right people, it could be a great investment.

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By tom123
06th Apr 2016 14:43

Useful if external

Michael Ford wrote:

Agreed that the price tag is prohibitive. However, if the standard encourages us to look beyond the numbers and instead ask whether the reports are telling the right story to the right people, it could be a great investment.

I guess if I was an 'external' accountant I probably would buy this - after all the info could be used in many circumstances.

For one business - probably a bit expensive.

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06th Apr 2016 15:14

Compare accounts?

There is talk about a standard making it easier to compare companies. That doesn't make sense to me for two reasons.

Firstly, management accounts are not generally publicly available documents. Who is going to be doing these comparisons? I can see different divisions in a corporate group being compared, but surely such a group would have uniform policies on preparation anyway.

Secondly, will they be comparable regardless.?One of the four key points covered is the "organisation's strategy and business model". If two companies, even in the same industry, have different strategies and business models, surely they will produce different management accounts as a result.

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07th Apr 2016 11:02
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By tom123
07th Apr 2016 16:38


NDK wrote:

Save yourself £80 

Thanks NDK - I think I have found a new page to peruse regularly. I do periodically look at CIMA's website - but never really get in to it.

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By jlsmith
08th Apr 2016 14:09

subject field is required

NDK wrote:

Save yourself £80 


Are you suggesting the standard is on there?  Or just lots of stuff to do with management accounting.

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07th Apr 2016 11:08

I think this came up in the F2 exam  a couple of years ago.  CIMA were looking for an answer on a company's management accounts and voluntary disclosures.  In theory I guess a good idea to have the same kind of information,  but what works for a multi national would probably be irrelevant for a 3 blokes in a shed set up,  and as stephurhan notes,  different companies have different business models so a one size fits all standard doesn't seem to make much sense.

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07th Apr 2016 11:09

Management Accounts

Stepurhan is correct. Management accounts are for management not public use. With over thirty years experience in a variety of organisations I have discovered each has had its own requirements.I have known highly effective managers who only want certain key figures and I have known others who wish to drill down to fairly low levels. The key is to be consistent throughout the organisation on what terms mean and what the key metrics are. Finance are a service and internally it is our role to provide what managers need and, if economically viable,what they want. How can you write a standard for that?


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07th Apr 2016 15:57


It's difficult to make an informed comment on this, given that I haven't read the standard, however, it seems unlikely that such a standard would be useful and add much to what already exists, or even be usable in many circumstances.

A standard might be useful though, in increasing the usability of management accounting, particularly for smaller companies. While big companies know exactly what they want and what they get, and have very customised requirements, smaller ones just don't have the time to put that much thought into management accounting and the value it could provide. This is a known issue which CIMA discussed in a paper a while back. I'd suggest a standard could help to solve this by providing some assurance of the value and services they'd get upon hiring a management accountant.

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