Accounting for Management Decision

Running head: ACCOUNTING FOR MANAGEMENT DECISION
Accounting for management decision
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ACCOUNTING FOR MANAGEMENT DECISION
Table of Contents
a) Background:........................................................................................................................2
b) Analysis of competitors of industry:...................................................................................3
c) Key financial results...........................................................................................................4
d) Key ratios:...........................................................................................................................4
e) Recommendation:...............................................................................................................9
References list:.........................................................................................................................10
Appendix:.................................................................................................................................12

ACCOUNTING FOR MANAGEMENT DECISION
a) Background:
a. Caltex is an iconic, proud and leading company of Australia which is engaged in
transporting fuel with a network of 1900 affiliated states. The company serve more than three
customers every week by its evolving range of convenience products and complicated supply
chain. It imports, refines and market the lubricants and fuels and meeting one third of the fuel
requirement of Australia (Caltex, 2020). Convenience is being taken to the whole new level
by way of embracing technologies.
b. Julian Segal is the chief financial officer and managing director of Caltex Australia
limited. For the workplace gender equality agency, managing director became a pay equity
ambassador. The board of directors of Caltex Australia comprises of Julian Segal, Steven
Gregg, Trevor Bourne, Melinda Conrad, Mark Chellew, Barbara Ward AM and Bruce
Morgan (Caltex, 2020).
c. Remuneration report is prepared by the directors of the company by adhering with the
section 300 A of the Corporation Act. As required by this section, information presented in
the remuneration report has been done. Fees of non-executive directors are fixed and for
chairing the board, the chairman of the company receives fee and no other fees are paid to
him. A base fee and an additional fees is received by the non-executive directors. In order to
retain and attract quality candidates in the market, remuneration elements are set at the
competitive elements. For removing the distinction in pay due to difference in gender,
reviewing of remuneration is done on a like for like job level.
d. Significant progress has been made by Caltex by the execution of infrastructure, fuels and
convenience retail strategies. The company have nearly doubled its earning per share over the
past five years and this has helped the organization in maintaining the position and
establishing the international footprints. Caltex has been set up for the sustainable growth

ACCOUNTING FOR MANAGEMENT DECISION
over the year 2019-2024 as it made significant progress in the execution of convenience retail
and fuel and infrastructure strategies. So far, the strategic partnership of Caltex with
Woolworths has been the most considerable step taken by the company in the retail strategy.
b) Analysis of competitors of industry:
a. Supplier power- The supply chain of Caltex Australia is complex and the company works
actively with the suppliers on private label packaging and packaging designs. Supplier’s
bargaining force is weaker for Caltex as they can easily switch to other suppliers as the
products are less differentiated and switching cost is low (Vetrov et al., 2017). Reasonable
pricing is provided by suppliers as the profits is closely associated with the suppliers pricing.
b. Buyer power- Bargaining power of buyers is weaker because of difficulties in switching
and they are less sensitive to price as they base their decisions on quality of products sold.
c. Threat of new entrants- The threat faced by new entrants is low as achieving economies
of scale is difficult and cost advantage cannot be easily reaped. Higher requirements of
capital also makes it difficult for the new entrants to enter the industry (Zainudin & Hashim,
2016).
d. Substitutes- Threat of substitutes is low as there is fewer availability of substitutes in the
industry of operation of Caltex. It is also less likely of buyers switching to the substitute
products as the products are sold by the firm at comparatively lower price.
e. Rivalries- The market space in which Caltex operates is highly competitive and the
increased competition from the existing competitors could adversely impact the operations.
Therefore, it can be said that rivalries from the existing competitors is high as the increased
competition is likely to adversely impact Caltex.