Most readers are undoubtedly aware of the fundamental requirements for a sound Managerial Accounting system. To assess the contractual terms presented to them by a PBM or other third-party payer, independent pharmacy operators must be able to calculate their cost of dispensing.
According to the National Community Pharmacists Association Digest, they are also aware of the use of financial data to conduct ratio analyses (liquidity ratios, profitability ratios, and inventory ratios) that establish solvency, identify issues, and assess how well their pharmacy is performing in comparison to other pharmacies.
Nevertheless, managerial accounting is the basis for all operational and decision-making processes in the firm, including human resource management, marketing, financial profit investment, technology review, and quality assurance programmes.
Read More Article: Daniel H. Cole
Prioritizing Your Managerial Accounting To Get The Most Out Of Your Business
Along with inventory control, accounting assures compliance with company policy, state board rules and regulations, drug counts, and other business-related requirements.
In their case study, researchers Ken Guo and Brenda Eshenbrenner examined how CVS Pharmacy was forced to pay a $77.5 million penalty for failing to put in place the essential safeguards to abide by rules that restricted the sale of pseudoephedrine.
1 The Combat Methamphetamine Epidemic Act of 2005 (CMEA) was passed into law to restrict the sale of pseudoephedrine as part of the government’s efforts to reduce the unlawful manufacturing of methamphetamine.
Get Better Managerial Accounting Results
Despite this, “smurfing,” which is when multiple individual purchases of pseudoephedrine at quantities at or below legal limits are made in an effort to avoid legal repercussions, occur, and the purchases are combined to produce methamphetamine, saw a surge in large-scale methamphetamine production in California in the middle of 2007.
According to a DEA investigation, CVS had established several CMEA compliance procedures, including physical control, a paper-based logbook, and an electronic logbook.
The “Lookback” component of the electronic logbook system, which tracked and reviewed consumer sales of pseudoephedrine that went against federal and state restrictions, was not properly implemented by CVS, though.
As part of its admission of guilt, CVS acknowledged that (1) some store employees sold the drug over the legal limit with knowledge, (2) the overselling stores knew the drug would be used to make methamphetamine, and (3) the company’s distribution centre had the ability to monitor and report excessive sales but did not do so.
What Distinguishes Financial Accounting from Managerial Accounting
The Committee of Sponsoring Organizations (COSO) Internal Control-Integrated Framework for Internal Accounting Controls and Reporting was used by the writers to investigate the case.
Risk assessment (the organisation considers the potential for fraud and identifies changes that could impact the system of control); control activities (activities that mitigate risk and activities over technology that support the achievement of ethical organisational goals;
information and communication technology) are all components of COSO (the organisation selects, develops, and performs ongoing evaluations to ascertain whether the components of internal control are present and functioning).
Make Your Managerial Accounting A Reality
A earlier halt to the continuous smurfing operations would have been possible in this situation if proper accounting systems had noticed the excess of sales in some establishments, even purchases made within individual legal limitations.
Pharmacy managers need to be aware of suitable and modern accounting procedures and methods to make accounting easier and help with risk management and operations control in addition to daily decision-making.
A Comprehensive List of Accounting Salaries, Organized by
I came discovered this list of “the best-paying American cities for accountants in 2022” from Smartest Dollar online and felt it was worth sharing because for many of you, earning money is the primary motivation for working in this field. Because Smartest Dollar,
like everyone else on the earth, seems to believe accountant = tax, we’ll go right past that and get to the salaries even if there are numerous paragraphs about the Inflation Reduction Act that somehow connect to accountant salaries when you click on that link.
Read More Article: Daniel H. Cole
Accounting Salaries Broken Examples
The U.S. Bureau of Economic Analysis’ Regional Price Parities datasets and the U.S. Bureau of Labor Statistics’ Occupational Employment and Wage Statistics provided the data for this analysis. Researchers at Smartest Dollar evaluated the median annual compensation for accountants after adjusting for cost of living in order to identify the regions with the highest salaries.
In cases of a tie, the area with the higher real annual median wage for accountants received a higher ranking. Only cities with a population of at least 100,000 were included to increase relevance. In addition, metro areas were divided into cohorts according to their population sizes: small (100,000-349,999), moderate (350,000-999,999), and large (greater than 999,999). (1,000,000 or more).