Management accounting practices in Nepalese commercial bank

Abstract

This thesis entitled “Management Accounting Practices in Nepalese Commercial Banks” was carried out in order to identify the practice of management accounting tools in commercial banks in Nepal. The main objective of the study were to asses and analyze the present accounting tools being practiced in the commercial banks in Nepal, To explore the areas where management accounting tools can be apply strengthen the commercial banks and to analyze the difficulties in applying management accounting tools in commercial banks. Descriptive this research design was used for this study primary data were collected through questionnaire survey were as secondary data were collected through annual reports of banks .out of 32 commercial banks in Nepal 10 banks were taken as sample for the study. The main target respondents were the financial directors and management accountants of the banks. The collected data were processed by using simple arithmetic percentage tool for analysis. There is significant practice of management accounting. While examining the MA tools practiced in Nepalese commercial banks for planning, controlling and decision making, it was found that Master budget; capital budgeting, and ratio analysis and cash flow analysis are widely practiced representing 80%, 70%, 60% and 50% respectively. Likewise, break-even analysis tools also were practiced 20%. Whereas other management accounting tools including flexible budgeting and zero-base budgeting were not practiced. 80% of the commercial banks carry out MA as base for company activities. Nepalese commercial banks are recommend not to use only traditional management accounting tools like past Budget, past trend analysis rather, they should move towards the application of new advance and modern management accounting tools such as activity based costing, Zero-base budgeting, etc. For smooth operation of the companies activities. Nepalese commercial banks were prepared their budget mainly by chief of finance so it is also recommend to take outside experts services as well as planning department also.