Managerial Accounting: External and Internal Analysis of Commonwealth Bank

Managerial Accounting

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Table of Contents
Overview....................................................................................................................................1
Part 1 External Analysis.............................................................................................................2
Business background..............................................................................................................2
Industry...................................................................................................................................2
General environment analysis................................................................................................2
Industrial environment............................................................................................................3
Competitive environment.......................................................................................................4
Opportunities and Threats......................................................................................................4
Part 2 Internal analysis and proposal.........................................................................................5
Firm resources -Tangible and Intangible resources of Commonwealth Bank.......................5
Capabilities Identification......................................................................................................5
Core Competency Analysis....................................................................................................6
Suitable Information System..................................................................................................6
Evaluation of proposed system...............................................................................................6
Conclusion..................................................................................................................................7

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Overview
Strategic information system is needed for every organisation whether the business is
small, medium or large. To execute their operations and functions, an organisation needs
strategic information system. It helps in executing the function with quality service so that
customers could be attracted. It helps the organisation to perform in an appropriate manner.
By using strategic information system the organisation meets the target requirements so that
brand image could be improved1. It helps in analysing all the concerns through which
performance could be improved by finding the loopholes so that changes could be made. In
this report the main focus is on the operations and processes undertaken by Commonwealth
Bank. This can be possible by using strategic information system. In this report, the first part
covers the external analysis of the company that includes business background, industrial
background along with general environment analysis. The competitive environment along
with its threats and opportunities are found. The second part deals with the internal analysis
of the company that covers identification of capabilities, core competency analysis and
evaluation of proposed system2. A system is proposed so that suitable information system is
implanted in an organisation.
Strategic information system is used to manage all the information by analysing the
information so that decisions could be taken. It is defined as a system through which business
strategy and structure could be aligned3. It increases the capability so that business can
respond to environmental changes so that controversy could be resolved. In this report,
common wealth bank is considered it is one of eth largest bank in Australia. It is very
beneficial as it changes the way a corporate form competes and focuses on the internal and
external factors of the business. They are concerned to make changes in the existing system
so that competitive advantage could be achieved.
1Gunther Doeker, "The Prerogatives Of The Crown In The Common-Wealth Of Australia
And External Affairs" (2017) 11(4) The American Journal of Comparative Law.
2Milton Harris, "Discussion Of Models In Managerial Accounting" (2018) 20 Journal of
Accounting Research.
3Mahmud Hossain and Pankaj K. Jain, "Regulations, Bailouts And Bank Shareholders’
Wealth: An International Analysis" [2014] SSRN Electronic Journal.

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Part 1 External Analysis
Business background
In this report, the company that is considered is an Australian Bank that is Commonwealth
bank it is located at darling harbour in Sydney. The company has expanded its services in
various parts like Asia, New Zealand, UK and US. It offers financial services for the
customer like retail banking services, institutional and business banking, offering funds and
investment techniques4. They offer services across the globe. The company is situated
globally and having employees approx. 55,000. It is one of the leading banks in Australia and
is also listed in Australian security exchange. It is one of the largest banks in the southern
hemisphere.
Industry
Commonwealth bank is offering financial service in the Australian market, though there are
many other banks offering similar services like Westpac Banking Corporation, National
Australia Bank and Australia and New Zealand Banking Group. These are the major banks in
Australia; there are various small banks that are rending similar financial service. Various
foreign banks have made entry in the Australian market5. The competition has increased in
the market due to the availability of various banks. Thus, commonwealth bank worked on
offering service and products in a unique way so that it could be differentiated from other
banks.
General environment analysis
 Economic- The performance of Australian banks were affected after global economic
recession. It affected the income which in turn affected the flow of funds. The whole
banking industry was affected after recession as consumer demand along with buying
4Mahmud Hossain, Santanu Mitra and Zabihollah Rezaee, "Auditing Regulations And Bank
Shareholders’ Wealth: An International Analysis" (2013) 25(2) Research in Accounting
Regulation.
5Haijin Lin and Brian Mittendorf, "Accounting Discretion And Managerial Conservatism: An
Intertemporal Analysis Discussion Of "Accounting Discretion And Managerial Conservatism:
An Intertemporal Analysis"" (2017) 23(4) Contemporary Accounting Research.