Hello, in this post we will discuss the Management Information Systems or MIS reports in accounts. We will cover the following.
What is MIS reports in accounting?
As per CIMA (Chartered Institute of Management Accounting), MIS stands for Management Information Systems. It is a collaborative report on people, organizations, technology and also about relationships among people and organizations affecting the company.
In general, accounting gives you a broad perspective on the financial position of a company like a record of all incomes, expenditures, assets and liabilities you posses.
Thus MIS report provides information on the day to day accounting activities, help to make business decisions and track the progress of the business. Business managers at all levels of an organization rely on these reports.
This kind of administrative reporting is used by all kinds of businesses whether small or large and in every industry as it gives specific information to the management.
In the MIS report, the company will aim to gather professional insights to help them identify and rectify those problematic areas.
This brings a notable increase in the efficiency rate in the company’s management operations. It also helps to anticipate salary and execution of the organization.
Components of MIS report in accounts
- Cost reports, (classification of direct, indirect, variable and fixed costs)
- Variance reports which have differences between what ideation and the actual result.
- Profitability factors and value drivers report, which tell the management what happened with the key factors in their business (sales quantity, sales price, cost per unit, profit per unit)
MIS has no standard format as it only depends on what the company management wants to see at that point in time.
Importance of MIS reports in accounts
- It helps to track the company’s financial growth, analyze and report the business income.
- It also analyzes business data from sources like employees, personal knowledge, documents, management, raw data, business models and executives to identify and solve problems as well as help to form decisions.
- The data gathered from different outcomes are then presented in graphs, charts, and tables etc.
- It helps to maintain communication between employees and between the employer and employee.
We have come to an end of this post on the MIS report. What do you think about this blog post? Share your views in the comment section.