Management can be defined as a creative problem solving which is accomplished through four basic functions: planning, organizing, leading and controlling. All functions are vitally important as failure to accomplish one function may lead to failure of the overall project. Actually, in accounting firm management functions are necessary to develop effective allocation of resources and to achieve the desired objectives and missions.
Planning is defined as the process of setting missions and objectives which are of top priority for accounting firm. Organizing is defined as coordinating and controlling of tasks and information within firm or company. Leading is defined as influencing employee by means of motivation, leadership and discipline. Controlling is defined as establishing and measuring standards of performance based on company’s missions and objectives. (Higgins 1998)
Planning function is considered fundamental from others are being developed. Planning is important for accounting firm as today’s’ decisions will directly affect the future of the firm. For example, in accounting firm financial manager is ready to go to organizing function only after goals and objectives are set. Planning affects all levels of management in accounting firm. Nevertheless, planning characteristics are varying from level to level. Planning suggests setting vision, missions, goals and objectives.
Vision is defined as non-specific motivational guidance. Mission answers the question why business exists. In accounting firm, mission answers the question about the necessity of bookkeeping. For example, one possible mission of accounting firm is to create net income balance for particular project or company. Objectives define market standing, productivity, financial resources, etc. Finally, goals are defined as “specific statements of anticipated results that further define the organization’s objectives”. (Erven 1999)
Organizing function ensures establishment of firm’s internal organizational structure. In accounting firm this function focuses on controlling accounting and financial tasks and coordinating the flow of financial information within the firm. Organizing suggests also labor division, authority delegation, departmentation, span of control, and coordination. As far as accounting firm has more than two employees, it has to take these decisions into account. Division of labor suggests that employees are divided to perform particular tasks. Delegation of authority is, primarily, distribution of power within firm. In accounting firm delegation of authority can be used to make financial manager free to pay attention to high priority activities. (Woody 1998)
Leading function is finding effective ways to guide employees’ work and to motivate them to perform better. Usually, this function is accomplished through effective interpersonal motivation, group dynamics, discipline and leadership. Actually, in accounting firm I am working in leading aims at channeling the behavior of employees to accomplish set goals and objectives. Nevertheless, the role of leader is vital as he should help people to stay motivated. Moreover, leading function is responsible for leading the flow of project accomplishing. Leading play important role in accounting as this process should be controlled to avoid calculating mistakes and not to waste time for checking in future. (Erven 1999)
Controlling function is measuring performance and taking prevention measures if necessary. The control process is, actually, a cycle process. In accounting firm, controlling suggests identification of computation errors and problems before the project is returned to the customer. Controlling is related with all other management function as it is built on planning, organizing and leading. Usually, effective control systems are characterized by flexibility, accuracy, timeliness, cost effectiveness, and ability to control all business levels. Also controlling is my firm is used to revealing inaccurate information or lack of understanding the necessity of information. (Erven 1999)
Higgins, James. (1994). The Management Challenge. USA: Macmillan.
Woody, Alexander. (1998). Staffing and Organizing the Management Accounting Function at Large Financial Institutions. Retrieved February 25, 2008, from http://findarticles.com/p/articles/mi_qa3682/is_199801/ai_n8760331