AFM5PMA Accounting & Financial Management

Develop a deep understanding of cost management techniques and utilize them in performance management

Demonstrate proficiency in integrating qualitative and quantitative information for a comprehensive evaluation of performance through the strategic application of management accounting technique

Exhibit a comprehensive comprehension of the commonalities and distinctions in performance measurement and analysis between profit and non-profit entities

Demonstrate the understanding and identify the strategic significance of key performance indicators in organizational management

This assignment involves producing a Written Report on Performance Management and Financial performance Management systems which assist managers in making their strategic decisions. This assignment is based on developing an understanding of different skills required to undertake degree level study of accounting and Finance and to enhance students’ knowledge in performance management through presentation and communication skills. This assignment enables students to measure the current performance of an organization against the set targets and to identify areas of strength and areas for improvement and evaluate the cause for each area identified. It will equip students with a comprehensive understanding of how organizations identify and analysis area of improvements and to acquire the capability of implementing different performance measurement techniques, by considering both financial and non-financial elements of the decision-making process. Written Report (4000 words) – + 10% 

 

Task 1: Application of Cost Management Techniques in Manufacturing

Word Count: 1,000 words

Learning Outcome: Develop a deep understanding of cost management techniques and utilize them in performance management.

Scenario:

TechGears Ltd., a manufacturing company that produces high-end electronic gadgets Alpa, Beta and Como, is facing increasing production costs due to inefficient cost allocation. The company currently uses a traditional costing system but is considering shifting to an Activity-Based Costing (ABC) system to gain better insights into cost drivers and improve profitability.

You have been hired as a management accountant to evaluate the situation.

Task Requirements:

Compare the traditional absorption costing system with ABC in the context of TechGears Ltd.

Information provided:

 

Absorption Costing

Meals @ Home Ltd has the following Flexed budget and actual performance for Product large meal kit box for the year ending 31 December

Both direct materials and direct labor are variable costs, but the overheads are fixed.

 

a)      Use the information from the above table and demonstrate proficiency through research to analyze the factors and issues which may have caused the variance to be favor/adverse for sales revenue, Material, Labor and overheads. Evaluate the strategies which can be used to improve the adverse variance critically. (500-words).

Using relevant information from the case, evaluate the benefits of using:

b) Budgeting and explain the manipulation issues in revising the budgets especially emphasizing on risk and uncertain issues may encounter in planning and control(250-words).

c) Discuss standard costing from the perspective of cost-control and decision making by researching and analysing past performance using the variance analysis techniques and the impact of different variances on past performance on material, market size and market share(250-words).

 

Task:3 (1000-words)

Performance measurement and analysis between profit and non-profit entities.

The NHS in England is one of the largest non-profit organizations and faces a lot of issues regarding its performance and is under a lot of criticism from its stakeholders, each with their own issues and concerns to be addressed. Its employees are looking for a high level of job satisfaction, a good level of work-life balance and aim to work more daytime hours. Patients want to be seen and treated quickly with a high level of medical care.

There is a potential conflict between the interests of these two stakeholders as staff wants to have day shifts and Patients will have to wait longer if they come for treatment outside these hours, which is a problem for NHS with multiple objectives from multiple stakeholders.

• Explain the issues of having non-quantifiable objectives in NHS regarding its performance management and explain how the performance of NHS could be measured by using different KPI’s. Reflect the concept of value of money, and how the 3Es (Economy, Efficiency and Effectiveness) can be used by the management of the NHS to achieve its performance targets(500 words).
• Evaluate compare how NHS and Meals@home identify and analyze areas of improvements and what improvement strategies can be implemented to address these in the profit and non-profit sector(500-words).