Essay: Accounting And Financial Management For Sustainability Framework.

Executive summary

Describe about the Accounting and Financial Management for Sustainability Framework.

Executive summary

The main focus of the report is to describe the business activities and financial reporting of  Blackmores. The company is the market leader in the health care sector and puts focuses on its sustainability framework in order to increase its values in the market (Berk and DeMarzo, 2007). The organization has deliberately applied a range of strategies and in operational activities keeping in mind the end goal to enhance its sustainability and in moving towards achieving superior transparency with respect to the environmental impact of the organization. The natural and also social effects of the organization have been talked about alongside its history, products and location (Block et al., 2011). The gap analysis will help to estimate the gaps between the facts and figures provided by the organization in the annual report with data gathered from other sources according to the rules and guidelines of GRI, which would be beneficial for the shareholders and stakeholders of the company.

The organization Blackmores is a reputed organization in Australia and considered as one of the largest organization in the healthcare sector and leader in the market of healthcare sector. However, the organization started its business activities in the year 1930 by the Maurice Blackmore, was a migrant and his thinking was relatively revolutionary (Butler, 2012). He starts the organization with a dream to give the general public better medicinal services with the use of naturopath treatment and natural herbs for guaranteeing the better wellbeing of the people in the community. During the time of its operations the organization has accomplished recognitions and many awards and the company has build its reputation in the market as well as achieving the competitive edge in the market (Elliott and Elliott, 2008). The organization has shown significant financial growth consistently and recorded among top 100 organizations in ASX. The organization basically manufactures vitamins products and around 250 different types of products that are manufactured and sold by the organization. Apart from this, the organization also manufactures wide range of herbal products and minerals and nutritious supplements according to the requirements and demand of the customers. Other than this, the organization provides wide range of health care services, which are valuable and popular among the general public (Fifield and Power, 2011). The organization is started at the Northern Beaches, Warriewwood on of Sydney and the internal enviornment of the organization gives a standard and friendly work place for the employees that lead on an adjusted way to deal with wellbeing, environment and life work. The campus size is 27,000 Square meters and the company has more than 7s00 staff serving the company.

Main body

The organization puts huge efforts on the advancement of the sustainable business and minimizing the natural effect of the organization and it will help the organization to improve its environmental and social acknowledgment, as in the blink of an eye everyone knows about the environmental impact. For a several reasons like use of vehicle and increasing number of production lines enhance the toxin level in the air in this way increasing the pollution level in the air (Helbæk, Lindest and McLellan, 2010). As an after effect of contamination, the existence of the green house gasses, like methane, carbon monoxide, carbon di oxide has been increased considerably that is considered as the fundamental driver of the global warming, and increases the risk for the general public. The customers prefer the product and services of the organizations, as they are eco friendly and economica. Thus the contemporary usiness associations gives great emphasis on creating viable CSR systems keeping in mind the end goal to build up them as the environmental friendly and socially responsible organization. The organization has been awarded as a well known recognized company in the field of sustainable business (Hillier, 2010). The supply of the energy is done through the grounds because it decrease the level of carbon di oxide decreased. Next to this, the organization uses solar chimney that give office of regular ventilation (Holton, 2012). The organization is attempting to decrease the environmental concentration alongside carbon impression by the start of the organization. The organization company saves at time of start thus enhance the effectiveness of the employees. Around  75% of the waste redirected from landfill. The organization has created administration framework for controlling environment issues and so as to deal with the ecological effect of the organization. The wastage of food from the industrial facility includes products is utilized for delivering green power (Moles, 2011). The organization has embraced the Recycling Label Plant Ark in Australia. The organization has also faced many threats from the activities plans and systems to enhance the efficiency of the waste administration also recycling the consumption of energy of the organization. The organization's waste execution plan improves its abilities in managing the wastes and also to set up a novel recovery process and plan (Moretto, 2008). Presently just 28% of waste sent to the dumping field and the present rate 30% and the redirection rate is 72%.

The report GRI assist in the making of sustainability report based on the operations and goal of an organization. The report comprises of the strategic analysis, authoritative profile, general disclosures, determination of the material aspects and limits, partner's engagement, the report profile, administration and morals and reliability (Spiceland, Sepe and Nelson, 2011). The examination gives the general perspective in regards to the management of the stakeholders with giving support according to the rules of the report. The system and analyzing the data in this manner that helps to make strategic management. The report likewise gives the vital articulation which exhibits the vision and strategy of the medium term, short term and the long term goals (Stittle and Wearing, 2008). The key accomplishments that are incorporated into the case help to provide suitable judgement and in this manner the acknowledgment of the standards are appropriately maintained with furnishing the execution in respect to the objectives. The difficulties for the organization are delineated with giving the objectives to achieve high performance level and in this way the approach of strategy is by all accounts fulfilling the things that relate the approach of the organization (Wild, 2005).

Sustainability report

The sustainability report of the company in the years 2016 and 2015 portrays decrease in the risk that are explained in the environment of the corporation. The significance is given to the public safety and common health that priorities the objective of the corporation (Wolf, 2008). The sustainability for an organization rotates around the employees, community, representatives, shareholders, administration and the investments for future development of the corporation. The commitment provided for sustainability gives the perspective to the formation of demonstrated adequacy, ingredient traceability, demand in the market, increasing employee efficiency and product quality. It gives the report of increase in stock on hand available with in this manner making direct source with the key fixings (Zopounidis, 2008). It additionally gives reasonable production network administration so as to empower the backing and encourage the ecologically and the socially capable methodologies for supply chain management.

The distinction that is shown in the report gives provides distinction between the partners and the shareholders of the companies. Every one of the partners is not shareholders but rather shareholders are clearly shown in the financial statements (Business analysis, 2008). The shareholders appropriately described in the sustainability report of the Blackmores however shareholders don't comprise of any part in the framework guideline of GRI. The distinctions are made in both the business which is by all accounts delineated for this situation and consequently the separation with the GAP examination is made that is by all accounts fruitful and the system is portrayed with the enhancement of the sustainability report.

The evaluation gives the commitment to make sustainable and substantial outcomes that helps in the accomplishment of effective communication system and process. The accountability and transparency originates from clear and efficient communications with the team members and in this way helps in presenting the adaptations of GRI standards and principles portrays G4 form of reporting standards (Cadle et al., 2014). The rules help in going about as the initiatives of global reporting. The advantages that are accomplished by assembling GRI rules with the report gave by company Analysis is by all accounts profiting the potential shareholders, investors and other stakeholders of the company are as per the following:-

The examination of the c-suite: The administration can be framed by determining the pressure from legislature with along these lines helps in perceiving stock trades, markets, speculators and general public everywhere to be straightforward. This associates the process of communication and in this way the advancement is made by the improvement of sustainability targets (Cadle, Paul and Yeates, 2010). The thought of the senior administration information should be completely checked with making the effect of the organization’s dedication and in this way the dedication is settled in the term of time and cash. The administration and the dedication make a bolster base for sustainability and for change of the association. 

Evaluation

The present material issue and the need for setting the materiality framework state-of-the-art is made with concentrating on usage of appropriate techniques. The standard refinement between the G3 and G4 rules are distinguished with putting emphasis on the way toward reporting keeping in mind the end goal for the examination which is by all accounts occurring and in this manner the investigation helps in the making the center as to the present reporting. For reporting issues that is by all accounts most represents the relevant key stakeholders and in the meantime they turn into the accomplishment for the association (Cadle, Paul and Yeates, 2010). Reporting changes from the fulfillment helps to maintain the environmental, economic and societal issues and in this manner it demonstrates that the partners and the general public is kep at large position in the organization.  

The materiality assist in making easy to use environment with giving the sustainability report and along these lines the making of exertion gives sustainability report and framework for the improvement of the entity. The GAP investigation helps in the production of values for the company with the use of the indicators of GRI which is by all accounts adequate as indicated by the new G4 GRI standard Disclosures. Besides the identification of GAP assists in demonstrating the qualities with making appropriate rules and guidelines and giving proper usage plan to the examination (Financial statements, 2013).

Conclusion

The report comprises of all the essential reports and has been shown in the case study which gives the structure of benchmarks that are delineated for both the associations that is the company and GRI. Therefore, the report comprises of working environment group with creating the development of structures with showing the business structure and development of sustainable environment with the correlation made for supply chain management. However, the natural and social effects of the organization have been talked about alongside its location, history, and products. Likewise the differentiation is made for the companies in appreciation to the general principles.

The significant expense connected with the business activities of the Global Therapeutics incorporates clinical trials, business supplies, non clinical studies, promoting cost and different exercises. The offering, showcasing expenses and associated manufacturing cost with GBT440 and different items incorporates cost and time so as to grow the sales and marketing abilities (Gowthorpe, 2008). The clinical practice likewise incorporates expense of business and the supplies of clinic that incorporates enrolling the patients for the trial in clinics in a convenient way. The expense is important to enhance technologies, maintaining and future acquisitions, expanding and to protect the intellectual property portfolio. Enforcing and getting of licenses of biopharmaceutical is very costly. The organization has likewise to invest into the innovative work of the products. Other expense incorporates pay rates, hardware, rent and protection (Revsine, Collins and Johnson, 2005).

Variable Cost	Amount ($)	Fixed  Cost	Amount ($)
Clinical Studies	250000	Building	2500000
Clinical Trial	400000	Intellectual Property	3500000
marketing Cost	300000	Equipment	600000
Commercial supplies	1,000,000	Salaries	1800000
Research & Development	700000	Rent	50000
		Insurance	250000
	2650000		8700000

Material issue

The expense associated with an organization includes fixed expenses and variable expenses. Fixed expenses are the cost that commonly does not vary with the increase or decrease in the amount of items sold or manufactured. The expenses have to be paid by the company. Variable expenses are the costs that fluctuate with the level of production of products. In this manner, it relies on upon the level of production (Robinson, 2009).

The breakeven analysis of the company help to measure and inspect margin of safety of the organization on the premise of related expenses and income gathered. It will empower the organization to investigate different price level in relation to different level of demand. Accordingly, it decides the business level that will be expected to take care of fixed expenses. The breakeven of point of the company Global Therapeutics would be  ($2650000+$8700000=$11350000). The breakeven examination is a valuable instrument that helps to decide the level of production or the desired sales target. It examines the level of fixed expenses in relation to the profit earned by each unit produced and sold. The net overall revenue of an organization can be increased with the increased in the income and diminishing the expense of production (Wild, Bernstein and Subramanyam, 2001). Therefore, the production expenses can be diminished with the assistance of executing proper procedures, strategies and methods.

Financial

Objective

The objective of the organiztion is to invest into its business activities such as investing for the development of the product, marketing activities, assts and operational activities

Outcome

The company Global Therapeurtics has implemented startgies and techniques to achive its financial objectives

Driver to measure

The financial perfromane of the company can be measured with the help of measuring the financial ratios that help to evaluate profitabiliy, efficiency and liquidity level.

Customer

Objective

The objective of the organization to increase the quality of care with the adoption of appropaite clinical practices.

Outcome

The company Global Therapeutics has put their efforts and implemneted technology to increase the quality of care and increasimng the satifaction level.

 Driver to measure

The feedback from the customers will help to determine and evaluate the satisfaction level.

Processes

Objective

The objective of the organization is to develop the internal control systrem as well as providing quality care to their patients.

Outcome

The managers and staff members ha managed apprpaiteluy the internal control system of the company.

Driver to measure

The coordination among team members, communication flow and tasks completion show the effciiency of the internal control system. 

Break even analysis

	Protein Shakes	Power-up Vitamin Juices	Recharge Bars
Expected Annual Sales	15,000	15,000	7,000
Selling price	7.80	9.50	5.60
Sales	117,000	142,500	39,200
Packaging cost	0.35	0.35	0.05
Ingredient cost	3.1	3.60	2.75
Total costs	5,253.1	5,253.6	352.75
Staffing and facilities costs	39,000	39,000	39,000
Marketing costs	9,333	9,333	9,333
Total cost	53,586.1	53,586.60	48,685.75

Breakeven point

Power-up Vitamin Juices

Revenue = Variable cost + Fixed cost

Protein Shakes

Sales Revenue = Variable cost + Fixed cost

Revenue = $53,586.10

Recharge Bars

Revenue = Variable cost + Fixed cost

Revenue = $48,685.75

Revenue	198,336.10	198,336.60	198,335.75
Packaging costs	0.35	0.35	0.05
Ingredient costs	3.10	3.60	2.75
Total costs	3.10	3.60	2.75
Facilities and Staffing costs	39,000.00	39,000.00	39,000.00
Marketing cost	9,333.00	9,333.00	9,333.00
Total cost	48,336.10	48,336.60	48,335.75
Net profit	150,000	150,000	150,000

To:

From:

Date:

Subject: The evaluation of annual profit and breakeven point

	Recharge Bars
Expected Annual Sales (units)	7,000
Selling price	26
Sales	182,000
Packaging costs	0.05
Ingredient costs	1.75
Total costs	351.75
Facilities and Staffing costs	22,000
Marketing costs	8,333
Total cost	30,684.75
Net profit	151,315.25

The Blackmores ought to implement and adopt proper procedures with a specific end goal to increase its sale of products and in addition building up the business sector increasing the market value. The yearly benefit and the breakeven analysis of the organization can be improved with the increase in the price of sale and diminishing variable expenses and the fixed expenses. The increase in sales of items and decrease in the expense of the items will increase the profit and the market estimation of the organization (Financial statements, 2013). The increase in internal control systems, operation efficiency, variable cost, product quality, appropriate level of price and marketing activities that will help to increase the profits. The expansion in operation productivity, inside control frameworks, amplifying stream of money expanding nature of item, deciding suitable cost level, embracing promoting exercises will build the benefit. The directors and fund division assumes a critical part in the administration of the expenses and income of the organization. The preparation of the financial statements would help to estimate and assess the income, cost, resource, liabilities, benefit or loss of the organization amid a timeframe. The breakeven analysis will evaluate and analyze the margin of safety of the organization on the premise of related expenses and income gathered. The administration and distribution of asset accomplishes the objectives of the organization.

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