Application of Internal Accounting Approaches for Management Accounting

Assesses Learning Outcomes:

Individual coursework – management accounting – application of internal accounting approaches and critical analysis of the results of the same in order to impact on performance, as well as analysis of the techniques themselves.

Assesses Learning Outcomes:

Critically evaluate the wider role of fundamental analysis within the context of corporate performance;

Critically evaluate using financial management practices to produce information appropriate for management to aid planning, control and decision making at strategic, tactical and operational levels.

In this assignment you are being asked to analyse and evaluate an internal management accounting approach.

You should assume that you are starting up a new company or project. You may choose the specific sector and its product(s)/service(s). Taking one technique from the management accounting part of the course, e.g. costing (standard, absorption, marginal, activity based), budgeting, planning, performance measures, decision making tools etc., discuss why you would implement this technique in the context of your new business in order to achieve your strategic aim/objectives.

You should include an appraisal of the technique you have chosen and why you have chosen it; its strengths and weaknesses, what results you might expect to learn from it, and how you would use those results.

Consider how practical the technique is for a start-up company or a new project, and how you might need to develop or modify it as the company/project becomes more established.

Note: this assignment is not about how to set up a new business/project; you do not need to provide a business plan or indeed evidence that the company/project has a market etc. The assignment is about why you, as a manager, would choose to implement one particular internal accounting/measurement approach in a start-up/new business/project.

1.Provide an introduction to your company/project; for example, industry sector, product/service and geographic location and your overall strategic aim for the company/project in the future (e.g. to be number one in the industry, be the ‘best’ employer). It is not expected that your business/project would achieve this aim at the end of the first year, but it indicates the strategic focus of your company.

2.Present the particular internal management accounting technique you have chosen to apply to your new business/project and why you think it is appropriate to support your strategic aim. You should analyse the data you expect to obtain from the technique and any limitations you can see, either from an implementation point of view or from a data point of view.

3.Analyse how the data you might obtain from your technique will assist you in improving the performance of the company on the way to achieving your strategic aim. This need not be necessarily in the financial sense, as it could be improving customer satisfaction, employee retention or market share for example,   depending on the technique you have selected. You should also consider how you might need to adapt your technique as the business becomes more established.

4.Conclude with an overall appraisal of the technique in the start-up company/project to support you in achieving the business’ strategic aim.

Please note: this assignment is NOT on any existing company/project (although you can of course, draw on any experience of other companies/projects), you are assuming a start-up situation. If any submission is on an existing company/project, there will be a 5% mark penalty.

There is no requirement for an executive summary.

All sources of information used must be reported according to the Harvard referencing system.

Evaluation criteria  

This is a guideline for the relative weighting of elements of the assessment and below is the marking rubric used in this coursework:

Introduction and initial presentation of company/project and appropriateness of technique selected to support strategic aim 20%

Analysis and application of technique, including an appreciation of the strengths and weaknesses of the technique 25%

Consideration of the data obtained from the technique and discussion of the development of the technique/data as the businessproject matures 35%