Description: Traditional full-absorption cost accounting systems suffer from some problems. As an example, they reward over-production and treat many costs as variable that are, for all practical purposes, fixed. Lean accounting solves many of the problems found with traditional cost accounting systems while better supporting managers’ attempts to implement lean in their organizations. Lean accounting provides simplified, plain English profit & loss statements that support the lean manger’s decision-making processes while still being reconcilable to GAAP financial statements. Lean accounting also requires the use of a different set of performance measures that better support lean principles. This session will describe the principles of lean and examine why they require a change to internal accounting reports. We will review the key components of lean accounting and demonstrate why they are beneficial to many organizations. We will describe how the University of Tennessee – Chattanooga has integrated lean accounting into our curriculum by including it as part of our MBA managerial accounting course and offering a lean accounting elective. In addition, we will provide examples of materials used in our courses.
Field of Study: Business Management and Organization
Program Level: Basic
Method of Delivery: Group — Live
Intended Audience: This course is intended for faculty/department chairs wanting an overview of lean accounting or considering integrating lean accounting into their curriculum.
Format/Structure: The format will be primarily lecture/presentation involving PowerPoint slides. However, there will be a hands-on exercise demonstrating lean manufacturing requiring participation of volunteers. Attendees will also be encouraged to ask questions and involve themselves in the discussion.
Learning Objective: After completing this course an attendee will be able to: articulate the principles of lean, describe lean accounting, incorporate lean accounting into a managerial accounting course, and demonstrate how lean accounting can be integrated into an accounting curriculum.
Advanced Preparation Required: None