UNIVERSITY OF SAINT LOUIS-TUGUEGARAO

School of Business Administration and Accountancy, 2013-2014

Junior Philippine Institute of Accountants
MEMORY AID IN MANAGEMENT ADVISORY SERVICES
Any form of reproduction of this copy is strictly prohibited!!!

CHAPTER 1:
MAS Overview

☛What is Management Advisory Services? Management consulting is not limited

to CPAs. There is no government licensure
 It refers to that practice of accounting examination yet for management consultants,
concerned with providing advice and hence, it is not regulated by law.
technical assistance to help clients
☛Characteristics of MAS engagement:
(referring to management) improve the use
of resources in achieving organizational  Services are rendered for the management
goals. rather than for third parties
 Scope is broad
☛What is Managerial Accounting?
 Future orientation
 (also called Management Accounting or  Involves problem solving
Internal Accounting) is a field of accounting  Not repetitive nor recurring
that provides economic and financial  Requires highly qualified staff(i.e., less
information for internal users, particularly junior staff)
the managers or decision-makers in an  Varied in nature
organization.  does not adhere to GAAP
 deals with specific organizational problems
☛Who is a Management Consultant or Advisor?
☛Stages in MAS engagements:
 a person who is qualified by education,
experience, technical ability, and i. Negotiating the engagement
temperament to advise or assist ii. Preparing for and starting the
businessmen on a professional basis in engagement
identifying, defining, and solving specific iii. Conducting the engagement
management problems involving the iv. Preparing and presenting the reports and
organization, planning, direction, control, recommendations
and operation of the firm. v. Implementing the recommendations
 an independent CPA who is not a member vi. Evaluating the engagement
of the organization but has the trust and vii. Post engagement follow-up
confidence of the manager.
☛Scope of MAS:
 [NOTE:] A CPA-consultant or advisor should not  All services rendered to management
take responsibility for making decisions and EXCEPT those in the areas of auditing, legal
policy judgments in MAS engagements. The
services, and taxation are included in the
power to make decisions rests solely on the hand
professional service of MAS and may
of the management and not of the advisor.
involve activities such as:

Management Advisory Services (MAS) Committee: Hazeleen Martinez; Jimmy Joe Miranda; Cliff Mark Confidente;
1 Corina Bariuan; Kristina Gaddon; Rizalyn Taguibao ;Niῆo Rey Mangupag; Marjhon Maramag; Leo Jay Labasan
Adviser: Mary Queen Ramos, CPA
 UNIVERSITY OF SAINT LOUIS-TUGUEGARAO
School of Business Administration and Accountancy, 2013-2014
Junior Philippine Institute of Accountants
MEMORY AID IN MANAGEMENT ADVISORY SERVICES
Any form of reproduction of this copy is strictly prohibited!!!

 Counseling management in its Controllership and treasurership constitute

analysis, planning, organizing, corporate finance. While controllership deals with
operating, and controlling records, systems, and processes to attain objectives
functions; of internal controls and good managing,
 Reviewing and suggesting treasurership, on the other hand, deals with money,
improvement in policies, cash, or wealth of an organization.
procedures, systems. methods,
and organizational relationships; Controllership Treasurership
 Introducing new ideas, concepts, -Planning and control -Provision of capital
and methods to management; and -Reporting and -Investor relations
 Conducting special studies, interpreting -Short-term financing
proposing plans and programs, and -Evaluating and -Banking and custody
providing guidance and technical consulting -Credit and collections
assistance in their implementation. -Tax administration -Investments
 The PICPA committee on MS classified the -Government -Insurance
broad areas of MAS into two groups reporting
namely: (1) finance and accounting services -Protection of assets
and (2) non-finance and non-accounting -Economic appraisal
services.

Financial Accounting Management ☛Fundamental steps in decision-making process:

Accounting
i. Set objectives
-Historical in nature -Deals with the future
ii .Identify constraints
-Uses GAAP -Does not use GAAP
iii. Gather appropriate information
-Reports are wholistic -Reports are
iv. Identify alternative
segmentized
v. Evaluate alternative
-Reports are for -Reports are for
vi. Choose the best alternative
general purpose management use only
-With unifying -No unifying equation
equation A=L+C ☛Analytical approach and process:
-Focuses on accounting -Multidisciplinary,
and finance also deals with other 1. Ascertaining the pertinent facts and circumstances
areas of knowledge 2. Seeking and identifying objectives
and disciplines 3. Defining the problem or opportunity for
-Focuses in the process -Focuses in the improvement
of preparing the FS usefulness of FS 4. Evaluating and determining possible solutions
-Precision/Accuracy -Timeliness/ 5. Presenting findings and recommendations
Relevance
-Regarded as “the -Regarded as” the In case the client requests the consultant to proceed,
process” product of the the latter may also be involved in:
process”
6. Planning and scheduling actions

Management Advisory Services (MAS) Committee: Hazeleen Martinez; Jimmy Joe Miranda; Cliff Mark Confidente;
2 Corina Bariuan; Kristina Gaddon; Rizalyn Taguibao ;Niῆo Rey Mangupag; Marjhon Maramag; Leo Jay Labasan
Adviser: Mary Queen Ramos, CPA
 UNIVERSITY OF SAINT LOUIS-TUGUEGARAO
School of Business Administration and Accountancy, 2013-2014
Junior Philippine Institute of Accountants
MEMORY AID IN MANAGEMENT ADVISORY SERVICES
Any form of reproduction of this copy is strictly prohibited!!!

7. Advising and providing technical assistance in Management accountants have a responsibility to:
implementing
 Maintain an appropriate level of
professional competence by ongoing
MAS PRACTICE STANDARDS
development of their knowledge and skills.
 Perform their professional duties in
All CPAs engaged in MAS practice should
accordance with relevant laws, regulations,
observe a set of MAS Practice Standards, which are
and technical standards.
classified into general and technical standards.
 Prepare complete and clear reports and
recommendations after appropriate
GENERAL STANDARDS
analyses of relevant and reliable
1. Professional competence
information.
2. Due professional care
3. Planning and supervision CONFIDENTIALITY
4. Sufficient relevant data
5. Forecasts Management accountants have a responsibility to:

 Refrain from disclosing confidential

TECHNICAL STANDARDS
information acquired in the course of their
1. Role of MAS practitioner
work except when authorized, unless legally
2. Understanding with the client
obliged to do so.
3. Client benefit
 Inform subordinates as appropriate
4. Communication of results
regarding the confidentiality of information
acquired in the course of their work and
Standards of Ethical Conduct for monitor their activities to assure the
Management Accountants maintenance of that confidentiality.
 Refrain from using or appearing to use
Management Accountants have an obligation to
confidential information acquired in the
the organizations they serve, their profession, the
course of their work for unethical or illegal
public, and themselves to maintain the highest
advantage either personally or through
standards of ethical conduct. In recognition of this
third parties.
obligation, the Institute of Management
Accountants, formerly the National Association of INTEGRITY
Accountants, has promulgated the following
standards of ethical conduct for management Management accountants have a responsibility to:
accountants. Adherence to these standards is
integral to achieving the Objectives of Management  Avoid actual or apparent conflicts of
Accounting. Management Accountants shall not interest and advise all appropriate parties
commit acts contrary to these standards nor shall of any potential conflict.
they condone the commission of such acts by others  Refrain from engaging in any activity that
within their organizations. would prejudice their ability to carry out
their duties ethically.
COMPETENCE

Management Advisory Services (MAS) Committee: Hazeleen Martinez; Jimmy Joe Miranda; Cliff Mark Confidente;
3 Corina Bariuan; Kristina Gaddon; Rizalyn Taguibao ;Niῆo Rey Mangupag; Marjhon Maramag; Leo Jay Labasan
Adviser: Mary Queen Ramos, CPA
 UNIVERSITY OF SAINT LOUIS-TUGUEGARAO
School of Business Administration and Accountancy, 2013-2014
Junior Philippine Institute of Accountants
MEMORY AID IN MANAGEMENT ADVISORY SERVICES
Any form of reproduction of this copy is strictly prohibited!!!
 Refuse any gift, favor, or hospitality that
would influence or would appear to
influence their actions.
 Refrain from either actively or passively
subverting the attainment of the
organization’s legitimate and ethical
objectives.
 Recognize and communicate professional
limitations or other constraints that would
preclude responsible judgment or
successful performance of an activity.
 Communicate unfavorable as well as
favorable information and professional
judgments or opinions.
 Refrain from engaging in or supporting any
activity that would discredit the profession.
OBJECTIVITY
Management accountants have a responsibility to:
 Communicate information fairly and
objectively.
 Disclose fully all relevant information that
could reasonably be expected to influence
an intended user’s understanding of the
reports, comments, and recommendations
presented.
 RESOLUTION OF ETHICAL CONFLICT
In applying the standards of ethical conduct,
management accountants may encounter problems
in identifying unethical behavior or in resolving an
ethical conflict. When faced with significant ethical
issues, management accountants should follow the
established policies of the organization bearing on
the resolution of such conflict. if these policies do
not resolve the ethical conflict, management
Management Advisory Services (MAS) Committee: Hazeleen Martinez; Jimmy Joe Miranda; Cliff Mark Confidente;
4 Corina Bariuan; Kristina Gaddon; Rizalyn Taguibao ;Niῆo Rey Mangupag; Marjhon Maramag; Leo Jay Labasan
Adviser: Mary Queen Ramos, CPA
accountants should consider the following course of
action:
 Discuss such problems with the immediate
superior except when it appears that the
superior is involved, in which case the
problem should be presented initially to the
next higher managerial level. If satisfactory
resolution cannot be achieved when the
problem is initially presented, submit the
issues to the next higher managerial level.
If the immediate supervisor is the chief
executive officer, or equivalent, the
acceptable reviewing authority may be a
group such as the audit committee,
executive committee, board of directors,
board of trustees, or owners. Contact with
levels above the immediate supervisor
should be initiated only with the
supervisor’s knowledge, assuming the
superior is not involved.
 Clarify relevant concepts by confidential
discussion with an objective advisor to
obtain an understanding of possible courses
of action.
 If the ethical conflict still exists after
exhausting all levels of internal review, the
management accountant may have no
other recourse on significant matters than
to resign from the organization and to
submit an informative memorandum to an
appropriate representative of the
organization.
Except where legally prescribed, communication of
such problems to authorities or individuals not
employed or engaged by the organization is not
considered appropriate.
 UNIVERSITY OF SAINT LOUIS-TUGUEGARAO
School of Business Administration and Accountancy, 2013-2014
Junior Philippine Institute of Accountants
MEMORY AID IN MANAGEMENT ADVISORY SERVICES
Any form of reproduction of this copy is strictly prohibited!!!

Management Advisory Services (MAS) Committee: Hazeleen Martinez; Jimmy Joe Miranda; Cliff Mark Confidente;
5 Corina Bariuan; Kristina Gaddon; Rizalyn Taguibao ;Niῆo Rey Mangupag; Marjhon Maramag; Leo Jay Labasan
Adviser: Mary Queen Ramos, CPA