Activity Based Budgeting - PDF
Added on 2020-12-09
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MANAGERIALACCOUNTING
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1(a) Description of Client Company........................................................................................1(b) Definition and Features of Activity Based Budgeting (ABB)..........................................3(c) Difference between Activity Based Budgeting and Traditional Budgeting Systems.......7(d) Whether Activity based Budgeting is suitable for Keytone Dairy...................................8CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................12
INTRODUCTIONManagerial Accounting can also be defined as cost accounting and it can be said as it isany process to identify, analyse, measure, communicate and interpret information to managersfor achieving the organizational goals (Prowle, 2016). The difference between managerialaccounting and financial accounting is that financial accounting helps in providing informationto parties that are outsider whereas, managerial accounting helps in decision making formanagers. This report deals with Activity Based Budgeting which is a type of Budget. In alsoincludes features, advantages and disadvantages of ABB. The Client Company which has beentaken is leading manufacturer of dairy products having registered in Australia. The comparisonwith traditional budgets of Activity Based Budgeting is also mentioned as required by client.MAIN BODY(a) Description of Client CompanyName- Keytone Dairy Corporation LimitedMarket Capital- 92.25 millionNo. of shares- 150 millionListing Date in Australian Stock Exchange- 18/07/2018Registered Office- Sydney AustraliaVision Statement- They aim to provide first class products to whole world.Keytone dairy was established in 2011 for the supply and production of fresh andnutritional dairy products for international and local markets, manufactured and located in theheart of the South Island (Key Stone Dairy Corporation, 2018). Keytone dairy current productionof 1500 tonne per annum has enabled them to target small and medium sized consumers.Keytone is in expansion phase by adding their production capacity through development ofmanufacturing sites. The first expansion will include a new industry of 1886 square metres andwill produce with annual capacity of 3500 tonnes. They source ingredients that are made in NewZealand’s clean and pure environment. These products are sold by leading supermarkets as wellas used by manufacturers and retailers around the globe. They are manufacturing first classproducts with premium ingredients. They are operating in dairy products segments of FMCGproducts. Keystone is focused on powdered dairy industry with nutritional ingredients which ishaving market of about US $21.4 billion and continue to grow. These products are produced1
under two brands i.e. “Key Dairy” and “Key Health” that includes premium milk and nutritionpowders as well as some of the beauty products (Key Stone Dairy Corporation, 2018). Keystoneis selling these products in multi form of packaging for meeting the needs of consumers intoday’s scenario. In addition to their brands, they are also manufacturing for other well-knownbrands around the world. Their head office is based in the heart of city which in turn facilitatestransport connectivity rail road and port allows seamless logistics for the company. Keytone ishaving a license of Certification and Accreditation Administration (CNCA). So, they can easilyexport to China (Key Stone Dairy Corporation, 2018). They are holding a certification fromFederation of Islamic association which helps in selling there in products in Islamic countries. Keytone has started selling their products in international markets in two brands which are:1.Key Dairy- It includes all powdered milk nutritional products like skim milk powder,colostrum milk powder, Kiwi fruit Milk Powder by using high quality products takenfrom fine sources of New Zealand.2.Key Health and Face Clear- In this brand, they provide the finest health supplementcapsules and the best natural beauty products.Keytone is capable of manufacturing number of products in their personal brands, butthey also work in contract manufacturing business (Key Stone Dairy Corporation, 2018). Theirpackaging is of different types which include sachets to bulk packing for industries. They areexperts in handling the requirements and logistics of their consumers globally. They aresupplying their bulk packaging throughout Australia and Asia. Some companies for whichKeytone does contract manufacturing are:1.Woolworth (Countdown)2.Alpine Milk Products3.Metro4.NZ Delight5.Dairy Work6.Natural Care7.Kobe Beef Calf Milk Replacer etc.The Latest Updates for Keystone are:2
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