Assignment - Advance Management Accounting

ADVANCE MANAGEMENT
ACCOUNTING

Introduction
 The managers use strategic management process at the beginning of any project at evaluating
and analyze about the market condition regarding the demand of the product and integrated
reporting technique is applied by the report preparers at the end stage of any project when the
product or service sold in the market and the company earns the revenue.
 The report preparers with vast knowledge regarding integrated reporting follow the framework
and gather information from all the department which are involved for the processing of that
specific product or service, about the earning of that company and then analyses the total profit
excluding the cost and manufacturing cost from the selling price.
 Whereas apart from all the opportunities, in this report, the challenges are highlighted along
with the steps that are adopted by Orica Limited to reduce the issues regarding these concepts.
The steps are discussed in detail. The discussion of this report also includes a few problems
which are also related to other major companies in Australia as well in the other companies
outside the country because the market demand is changing day by day.

Discussion
1. The challenges faced by Orica Limited regarding the
implementation of Strategic Management
Strategic Management is very important for every organization. Orica Limited has maintained
and worked according to the format under strategic management. However, Orica has faced few
issues while the executive managers work according to the framework under the strategic
management, and many of them are unavoidable (Abeysekera, 2013). The challenges explained
following:
 Training inefficiency by the organization
 Lack of strategy efficiency
 Failing to communicate adequately (Accaglobal.com, 2020)

 Smartly utilising the resources
 Following the planned strategy carefully (Adams, 2015)
2. How Orica Limited tries to eliminate or minimize the issues
related to Strategic Management
 Ineffective training
 Weak strategy
 Miscommunication (Aicd.companydirectors.com.au, 2020)
 Limited resource
 Maintaining the strategy thoroughly

3. Orica Limited faces some common challenges or issues regarding
the Integrated Reporting
 Maintaining the materiality of the report as well as the time invested
 The workload is increasing day by day
 Adoption cost of the organization (David & David, 2019)
 No issues from the stakeholder side regarding the usage of traditional method
 Enough knowledge regarding the information to be collected

4. More distinguished issues faced by Orica Limited regarding the
report and how do they address the issues
 Effects of incentives, barriers and enablers: Simplification, High demand shown by capital
providers, Promoting the reporting style, Promoting the different growth organizations,
Encouraging the integrated reporting method, Helping the newcomers, Understanding the
reporting better fit (Cheng et al., 2014).
 Other issues related to quality: Assessing the opportunities for improvement, Promoting the
credibility contribution, Training.
 Content element: Disclosing vital information, Disclosing information regarding opportunities,
Organization support for creating value (Australian Financial Review, 2020).
 Essential principles for guiding the organization: Thinking and reporting, Importance of
balance, Alignment of reporting framework.

 Preparing a well-planned business model: Distinction, Better communication by the
corporation, Increase of integrated reports, Elevation of charged statements.
 Maintaining the materiality as well as creating value: Understanding the concepts,
Resolving the interpretations, Suit different forms of reports, The similarity between
materiality, The practical examples are shared, Clarification, Promoting examples.
 Proceeding towards multiple capitals: Improving the market understanding for the method of
the various capital, Help report, The Orica Limited ensures to execute some meaningful and
leading practices, Being updated with the current IIRC guidelines.
 Maintaining the report integrity along with the connectivity: Improving the decision
making process, Communicating with others, Promoting practices, Improving the market
understanding (Assets.kpmg, 2020).

 The organization maintains stakeholder’s legitimate needs and the interests:
Understanding the market, Stakeholder relationship, Access to the legitimate needs.

Conclusion
Form the above discussion, and it can conclude that there are mainly the common issues and
challenges which are raised by the Orica Limited and they are similar to the problems posed by
other companies as well who are also engaged in using integrated reporting and strategic
management process for their management. The issues, however, can be eliminated to some
extent if followed some simple steps as followed by Orica Limited. There are many organizations
where they use traditional method but stakeholders raised no issues regarding that. Orica Limited
in their annual report has also increased the concerns regarding the process of strategic
management and the process of integrated reporting. The report has addressed the issues that even
after considering all the facts from the framework, it is not possible to avoid few issues altogether
because the market and capital investors’ demand is changing day by day and it is challenging to
meet all the expectations at one point of time.

References
Abeysekera, I. (2013). A template for integrated reporting. Journal of Intellectual Capital, 14(2), 227-245.
Accaglobal.com. (2020). Insights into Integrated Reporting: challenges and best practice responses | ACCA Global. Retrieved
18 January 2020, from https://www.accaglobal.com/pk/en/technical-activities/technical-resources-search/2017/april/insights-
into-integrated-reporting.html
Adams, C. A. (2015). The international integrated reporting council: a call to action. Critical Perspectives on Accounting, 27,
23-28.
Aicd.companydirectors.com.au. (2020). Retrieved 18 January 2020, from
https://aicd.companydirectors.com.au/membership/company-director-magazine/2017-back-editions/october/integrated-
reporting-the-whole-picture.
Assets.kpmg. (2020). Retrieved 18 January 2020, from https://assets.kpmg/content/dam/kpmg/au/pdf/2016/corporate-
reporting-asx-200-evolution-integration.pdf.
Australian Financial Review. (2020). Integrated reporting: Telling the whole story has become the trend for business.
Retrieved 18 January 2020, from https://www.afr.com/companies/telling-the-whole-story-the-trend-for-business-20180225-
h0wlzm.
Cheng, M., Green, W., Conradie, P., Konishi, N., & Romi, A. (2014). The international integrated reporting framework: key
issues and future research opportunities. Journal of International Financial Management & Accounting, 25(1), 90-119.
David, F. R., & David, F. R. (2019). Strategic management: A competitive advantage approach, concepts and cases. Pearson.

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