CIMA BA2 study guide
CIMA BA2 · Work through your exam, one topic at a time.
BA2 Fundamentals of Management Accounting is one of the entry-level subject examinations in CIMA's Certificate in Business Accounting, the first stage of the professional management accounting route. The Certificate is aimed at people who are starting out in finance - students and career changers, as well as non-financial managers and staff in shared-service or transactional roles - and who need a working command of how cost and management information is built and used inside an organisation. BA2 concentrates on the internal, decision-facing side of accounting rather than published financial reporting. Its syllabus content falls into four broad areas: costing and pricing; budgeting and forecasting; cost accounting techniques and systems; and short-term decision making and performance measurement. The CIMA BA2 study guide has 4 sections and about 1,283 words.
01Costing and Pricing
Candidates must classify costs by behaviour (fixed, variable, semi-variable, stepped) and by traceability (direct, indirect). Absorption costing allocates indirect costs to cost centres and recovers them using a predetermined overhead absorption rate (OAR): budgeted overhead ÷ budgeted activity base (labour hours, machine hours, units).
330 words, about 2 min02Budgeting and Forecasting
Candidates must know the purposes of budgeting (planning, control, coordination, motivation, communication) and the main approaches: incremental, zero-based, rolling, and activity-based. Fixed budgets suit stable environments; flexible budgets are flexed to actual activity for control.
313 words, about 2 min03Cost Accounting Techniques and Systems
Candidates must distinguish job, batch, contract and process costing, and know when each applies. Process costing handles continuous production and requires normal loss, abnormal loss or gain, scrap values, and equivalent units (EU) where work in progress exists.
327 words, about 2 min04Short-term Decision Making and Performance Measurement
Short-term decisions use relevant costs: future, incremental cash flows that differ between alternatives. Sunk costs, committed costs and allocated fixed overheads are irrelevant.
313 words, about 2 min