Management Accounting free essay sample

This revolution of management came to understand the need for amalgamating accounting and management techniques. Strategic management accounting is the analysis of data regarding management accounting relating to a particular business as well as its competitors (Sharma, 2009). Puma consistently develops innovative product and marketing campaigns to improve the brand profile and to continually increase product and brand desirability. Strategic Positioning concern performing different activities from rivals or performing similar activities in different ways. It is how a company will present itself to the market giving itself a competitive edge. The Business environment in which they operate is however large and therefore they cannot use the same concepts everywhere therefore decentralisation for day to day management is effective while IT systems can be used for centralised monitoring and coordination, Introduction Management accounting techniques were adopted and used to analyse and evaluate the business information of Puma. The results from the evaluation and analysis will be reported starting with the Company Profile Puma SE (PUMA) and its adaptability to business environment changes focusing on management accounting changes, technologies used management practices and its product life cycle. We will write a custom essay sample on Management Accounting or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The Cost Management and Product Management Accounting Techniques adopted by Puma are essentially reported on thereby describing the company’s strategic positioning and the challenges faced by Puma in implementing is techniques. The report will recommend ways in which Puma can reduce or eliminate its limitations. Company Profile PUMA was established in 1924 by founding brothers Schuhfabrik Rudolf Dassler and Adi Dassler and was renamed PUMA Schuhfabrik Rudolf Dassler in 1948 when Adi left the company to start his own shoe company, Adidas. Puma employs more than 9,500 people worldwide that designs and develops footwear, apparel and accessories making it one of the worlds leading sportlifestyle companies. The company and has headquarters in Herzogenaurach/Germany, Boston, London and Hong Kong and went public in 1986. The PUMA Group owns the brands PUMA, Cobra Golf and Tretorn. The Company has a total Capital Stock of â‚ ¬ 38,611,108. 00 as per 01/01/2012 till 31/12/2012 financial statements. PUMA sponsors many athletes such as Olympic champion Usain Bolt of Jamaica and another large number of national and club teams in sports ranging from soccer to cricket. PUMA starts in Sport and ends in Fashion Its Sport Performance and Lifestyle labels include categories such as Football, Running, Motorsports, Golf and Sailing. Sport Fashion features collaborations with renowned designer labels such as Alexander McQueen, Mihara Yasuhiro and Sergio RossiIt is committed to working in ways that contribute to the world by supporting Creativity, Sustainability and Peace, and by staying true to the principles of being Fair, Honest, Positive and Creative in decisions made and actions taken. (Delloitte and Touche, 2013) Management Accounting Changes due to Business Environment The business world of today has become much more complex and vast with most properly set up and registered businesses of any size penetrating markets much further from their geographical locations. The change of markets and their influences led to the development of modern business environments. Business environment therefore refers to the influences and pressures exerted by external factors on the business. The rise of these market forces on businesses led to management’s development of strategies that would totally take advantage of the opportunities in the new markets essentially increasing profits while complying with laws and societal values at the same time suppressing any threats from the new market forces. This revolution of management came to understand the need for amalgamating accounting and management techniques. Strategic management accounting is the analysis of data regarding management accounting relating to a particular business as well as its competitors (Sharma, 2009). In Germany, the business environment is basically regulated by the government, business associations and other special bodies. The Frankfurt Stock Exchange is one special body that influence and facilitates the Germany business environment. The Prime Standard is a transparency level based on a legal framework provided by the EU-regulated markets. Companies listed in the Prime Standard are required to meet high transparency standards such as use of international accounting standards (IFRS/IAS or US-GAAP) and publication of a corporate calendar staging of at least one analyst conference per year. Sustainability indicators provide investors of the opportunity to support responsible company management. The philanthropic and social activities of the company are also considered here. Puma adjusted its management accounting strategies and adopted the most suitable for business. Business processes reengineering in redesigning and changing the existing practices or processes in the business in order to attain significant improvement in the performance of the organization (Adeyemi, 2008). One of the most crucial management accounting process in a firm is control. () Control refers to the process of making sure that an organization’s activities are in accordance to the plans so that its objectives can be achieved successfully. Puma adopted the management accounting control‘s main two elements. Puma’s management are involved in the formal planning processes such as budgeting and long term planning. Puma created responsibility centres that commence the process of allocating the answerability for financial outcomes and results to the individuals in the entire organization. Drury (2008) accounted that, while designing effective management control systems it is very important to take into account the current circumstances. Modern Manufacturing Technologies Manufacturing departments rely on operational information that provides management with data on departmental outputs and performance, e. g. , production volumes, lead and delivery times, product defects and resource consumption. Recent empirical findings suggest that nonfinancial data should have a prominent place in manufacturing departments not the least in companies emphasizing customization and manufacturing A second challenge was communication. Pumas global design and manufacturing teams are based in different countries. It is really crucial for to have the team members holding the same physical model to which they could all relate. Puma has installed 3D printer in each of the sites. Each team prints the same prototype model, so that when we have conference calls to discuss design and manufacturing issues, we are all on the same page. Each team is viewing and holding the exact same model, which allows us to communicate much more easily than before. The PumainCycle Collection was born from Pumas challenge to produce a fully recyclable or biodegradable collection as part of the learning journey to improve the sustainability of its products. To develop the collection, Puma collaborated with EPEA, whose mission it is to help companies fulfil the Cradle to Cradle Products Innovation Institutes criteria for the design of ecologically and intelligently designed products. Management Accounting free essay sample The group is required to undertake a project on a management accounting topic related to the course (refer attachment). The objective of the project is to provide students an opportunity to gain an in-depth knowledge of the theoretical underpinnings of one of the management accounting topics and to summarize any current articles of the topic (the chosen articles must be accepted by your lecturer). 2. The group projects may be done in groups of at most five students (you may choose you own group members). Each group will be entitled with one group project (see Attachment A). . The assessment marks for the group project is equivalent to 20 marks. 4. The group project report should be submitted to lecturer in class not later than week 10. Late submission of the term project will not be entertained, i. e. , a grade of ZERO will be assigned. 5. The group project report should follow the guidelines below: a) Written in English language b) Computer typing Arial, Font 12, 1. We will write a custom essay sample on Management Accounting or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page 5 line spacing c) Properly cited and follow the APA referencing style (http://www. apastyle. org/) 6. Criteria for grading the written group projects is as follows: a) Good writing quality ) The presentation style of a group project report c) Demonstration of appropriate citing in use of source materials d) Evidence of group effort e) Clarity, precise and thorough analysis in demonstrating the group project report 7. Minimum 25 pages. ATTACHMENT A GROUP PROJECT QUESTION (20 marks) 1) Management Accounting – (A) How has the technology changed the work of management accountants? What other business trends are influencing managerial accounting today? How do these other trends impact management accountants’ roles in the organization. (B) Find a recent news article on an ethical issue. You have to write a summary of the article and how financial and managerial accountants could have used information to detect the activity. 2) Performance evaluation system – (A) Explain why using financial statements as the sole performance evaluation tool for a company is probably not a good idea. What issues can arise from using only financial measures for performance evaluation? (B) Obtain published financial statements of two manufacturing companies within the same industry. Compare and contrast their income statements and balance sheets. How does the cost of goods sold vary for the two companies? What are the gross margin percentages for the companies? How would manufacturing companies determine the price to charge their customers? How does this compare to a service organization? Provide examples of product costs and period costs? 3) Balance Scorecard – (a) List and describe the four perspectives found on a balance scorecard. For each perspective, list at least two examples of KPIs that might be used to measure performance on that perspective. (B) Find a recent news article on Balance scorecard. You have to write a summary of the article. 4) ABC – A) Discuss the current issues in Activity Based Costing (ABC) implementation. Why most of the companies do not adopt ABC system in their production line/companies. (B) You are required to find websites of other businesses that use activity-based costing. Identify specific concerns that the business may have in using activity based costing. Provide examples of how activity-based costing has improved the business. What w as the purpose of establishing ABC within the business? 5) Traditional Management Accounting Technique – (A) List, describe and discuss the traditional management accounting technique. Explain why traditional management accounting technique is said to be inappropriate to be used in contemporary business? (B) Students are required to find websites of businesses that would use job-order costing. Identify specific concerns that the business may have in using a job-order costing system. Provide examples of the types of costs that the business would need to accumulate. Give examples of overhead costs for the business and how it would determine a predetermined overhead rate. 6) Contemporary Management Accounting Technique – (A) List, describe and discuss the contemporary management accounting technique. Explain why contemporary management accounting technique is said to be appropriate and relevant to be used in contemporary business? (B) Find a recent news article on JIT (Just in Time). You have to write a summary of the article and; review the current practice and future direction for the research. 7) Budgeting – (A) Discuss any shortcomings of traditional budgeting system and explain why the budgetary control is lacking in terms of long-term goals. (B) Find a recent news article on Budgeting system. You have to write a summary of the article and; review the current practice and future direction for the research. ) Cost-Volume-Profit Analysis SET 1– (A) About 80 percent of all new businesses fail in the first five years. A major reason for their failure is the lack of equity financing. To obtain financing for a new business, it is necessary to show how the business will make a profit. Five simple steps to help convince cautious investors to risk funds in a new busines s follow: 1. Project start-up costs and operating budgets. 2. Project income statements. 3. Project cash flow statements. 4. Determine the business’s break-even point. 5. Develop â€Å"Plan B. † Discuss the above five steps in order to help convince cautious investors to risk funds. (B) Obtain published financial statements of a manufacturing and a service organization. Identify the products or services provided by the company. Discuss how the company would use cost volume profit analysis. If the company has multiple products, address the complexity of using the CVP tool and what internal information would the company need to use CVP. 9) Short-term Business Decisions – (A) Despite its growing popularity, outsourcing has gotten a bad rap over the past few years. While there may be good reasons for it in certain circles, it doesn’t mean that such strategies aren’t a good idea for small to mid size enterprises. Discuss the statement above. (B) Find articles that describe decision-making models and concepts used by businesses. Topics could include productivity measures, make or buy decisions, or sell-now or process further decisions. Discuss how the management technique motivates the behavior of its employees. 10) Standard Costing (A) Based on one of the Japanese companies, describe how costs can be reduced through the concept of â€Å"Kaizen†? Students are required to find websites of companies who use kaizan costing or target costing. Discuss how these standards are used and what benefits the companies have experienced in using these methods. (B) Find a recent news article on Kaizen costing. You have to write a summary of the article and; review the current practice and future direction for the research. 11) Managerial Accounting current issues (A) Base on the current issues in Airline System in Malaysia, Minister call for merger Air Asia and Malaysian Airline System (MAS). A merger of Malaysian Airline System (MAS) and AirAsia Bhd will enable the two entities to compete in the global arena. In managerial accounting point of view, discuss the concept of Strategic Cost Management (SCM) and explain how it can be implemented in the above situation. (B) From the articles of â€Å"Research in management accounting innovations: An overview of its recent development†, you are required to critically summarize and identify the contemporary management accounting systems that have been highlighted in the paper. 12) Cost-Volume-Profit Analysis SET 2– A) Assume that the group is acting as a Product Steering Committee. Evaluate the feasibility of producing the product based on the financial data of any companies. Discuss the possible courses of action that the company might take to improve the financial performance of the product. Also, discuss some reasons why the company might wish to produce the model of product even if it does not promise good finan cial returns. (B) Find a recent news article on CVP. You have to write a summary of the article and; review the current practice and future direction for the research.