Management Accounting - Tesco Plc

Running head: MANAGEMENT ACCOUINTING
Management Accounting
Name of the Student:
Name of the University:
Author’s Note:

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MANAGEMENT ACCOUINTING
Table of Contents
Introduction......................................................................................................................................2
Discussion........................................................................................................................................2
Balanced Scorecard and Its Purpose............................................................................................2
Benefits and Limitations of Balanced Scorecard Approach........................................................5
Application of Budgeting Tools..................................................................................................7
Conclusion.......................................................................................................................................9
Reference.......................................................................................................................................10

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Introduction
The main purpose of this assessment is to analyse the business of Tesco Plc and
appropriately identify the different area of performance of the business. The assessment would
be identifying the components of balanced scorecard and different elements of the balanced
scorecard which is applicable to the management of Tesco Plc. The assessment would be
identifying the benefits and limitations which are associated with balanced scorecard approach.
In addition to this, the assessment would also discuss different types of budgets which can be
used by the business.
The company which is considered for this assessment is Tesco Ltd which is engaged in
the retail business and offers different kind of products to the customers (Tesco plc. 2019). The
application of balanced scorecard as a performance management tool can enhance the
effectiveness and efficiency of the business. The assessment would be outlining the attributes of
balanced scorecard in relation to the area of performance of the business.
Discussion
Balanced Scorecard and Its Purpose
Balanced Scorecard can be described as a strategic management tool which is often used
by businesses as a performance metrics which can measure various internal function of the
business along with the external functions of the business. It can also be used as a performance
management tool by companies to measure whether the company is following the goals and
objectives of the business associated with different area of the business (Martello, Watson and
Fischer 2016). The balanced scorecard targets which are set by the management of Tesco Plc is
shown below in a diagram which effectively represent the key areas of performance as per

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MANAGEMENT ACCOUINTING
balanced scorecard. The management of Tesco Plc has developed its performance metrics by
benchmarking its closest rival Sainsbury’s.
QUANTITY QUALITY
FINANCIAL PERSPECTIVE
 Improvement in the rate of sales by
10%.
 Reduction of costs for US operations as
well as UK Business.
 Enhancement of return on equity by
16%
 Growth in the operations of
business from International
Business.
 Improving the cash flows of the
business for improving the overall
liquidity of the business.
CUSTOMER PERSPECTIVE
 Increase in the range of products which
is offered to customers.
 Increase in the range of choices for
different brands of products.
 Enhance the satisfaction rate for the
customers
 Reduction in the complaints from
the business and avoidance of
product return. Increased focus on
customer satisfaction and positive
feedback.
 Focus on reduction of prices which
the customer need to pay for the
UK based customers to make the
brand popular
INTERNAL BUSINESS PROCESS PERSPECTIVE