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HA2011 Managerial Accounting Trimester 1 2018 Group Assignment

   

Added on  2021-06-16

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Holmes InstituteHA2011 Managerial AccountingTrimester 1 2018Group AssignmentStudent NameDate

IntroductionAs an employee of Taura management I was part of a team which was assigned the task of evaluating the suitability of the Balance Scorecard (BSC) to the Bega Cheese Limited. As part of a group I was tasked with preparing the report to the client regarding the findings of the research. This was to be presented to the CEO of Bega Cheese Limited upon completion. Bega Cheese Limited is on the verge of reviewing its budgetary system with the CEO having an I interest in the BSC. The CEO recently attended a seminar regarding the BSC model and had thereby requested our services in evaluating the suitability of the model to the firm’s management performance.The report is thereby designed to give an overview of Bega Cheese limited and the BSC model. Secondly, we evaluated the difference of the BSC model with other models for measuring performance. The report was then concluded with the analysis of the suitability of BSC to the Bega Cheese limited which was finalised by recommendations on the way forward to the CEO.Description of Bega Cheese LimitedBega Cheese Limited is a resident company of Australia. The firm is located in Bega town which is in New South Wales Australia. The first was initiated as an agricultural cooperative under the ownership of the Bega diary farmers. In 2011 the company was registered as a public limited company and went ahead to be listed on the Australian Securities Exchange. Most of the company shares are currently owned by the suppliers from Bega. The company majorly relies on the sale of cheese and processed cheese products to generate most of its operating revenue. These products are sold under the Bega brand. In addition, the firm also sells other brands such as Tatura, Royal Victoria, Melbourne and Dairy Mont. The retailing process also includes products such as Cheese, Cream cheese and powdered milk. This is responsible for around 40% of the firm’s total revenue. Currently Bega Cheese products are retailed within Australia as well as exported in around 50 other nations across the globe[ CITATION Bei17 \l 2057 ].BSC and its Features

The BSC is a strategic tool that the management can effectively apply in evaluating companyperformance. It’s a mini-standard report that is structured in away that the management can apply it to keep records of the firm’s employees and major activities under there control. With its application the management can monitor the actions of the staff and make decisions that may settle any arising issues in the curse of the business operations. BSC was a term which was initially used to refer to management performance reports that were usedby managers of a firm in implementing the strategies of the organisation as well as the daily operations[ CITATION Leg08 \l 2057 ].BAC can also be used by an individual to gauge their performance. This though is not a popular application of the model. The model can be used to inform personal objectives setting as well as calculation of incentives. The features listed below can be used to define the BSC.The model involves selecting a small data sample to monitor.The model’s weight is heavily put on the strategic agendas of the firm of concern.The balance scorecard evaluates a mixture of financial and non-financial data sets[ CITATION Mou171 \l 2057 ].The BSC is one of the closed loop controllers that management may apply when monitoring the implementation of the firm’s strategies. In this case once performance is estimated the obtained value is compared with a defined reference point. Should a difference arise its will be used to formulate the corrective measures that the managers need to pursue to optimisethe firm’s performance. The control measure need to accommodate the below items for its to be successful [ CITATION Kel131 \l 2057 ].Selecting the data to be measuredSetting the reference value.Ability of the managers to take correction actions where necessary.Analysis from the strategic management perspective indicate that the three features of a closed loop control system should be derived from the strategies of the organisation and should reflect the capacity of the observer to measure performance output and take corrective measures should a need arise. At the beginning the applications of the BSC was promoted as a general-purpose performance management system, later the applications

were introduced as a way of evaluating unique strategies [ CITATION Kap92 \l 2057 ]. Recently the system has been accepted by several organisations as they strive to efficiently, measure and control the implementation of strategies.Features of the BSC modelThe balance scorecard is a tool of management that is suitable for evaluating the performance of firm. Instead of evaluating single features of the organization, the balance scorecard considers numerous aspects of the firm. The idea of the BSC first come to light in the closing stages of 1980s, from here the idea has undergone tremendous evolutions characterised with massive improvements. The system has improved in flexibility and is currently applicable to several firms from different sectors [ CITATION Eps \l 2057 ]. The system design, effectiveness and ease of use have all been improved. Applying the balance score card allows for evaluation of numerous aspects of the firm with equal weight. This gives room for the management to evaluate the success of the organisation using the success of all the relevant features [ CITATION Rig13 \l 2057 ]. Despite the ability of the model to accommodate several features based on the needs of the managers, an efficient balance scorecard model should be characterised by the aspects listed below;Ability to measure finance performance, this aspect of management performance tool is one of the ancient features of the balance scorecard. Firms profitability is highly influenced by the performance of its finances for this reason managers will find a tool inefficient unless it is able to measure performance of the financial activities (Kaplan & Norton, 1996). The biggest expectation of the shareholders is to see the value of their shares grow. Managers are agents of the shareholders and are designed by corporate requirements to adhere to the expectations of the shareholders. A BSC model allows the firm to measure aspects like return to asset, profit margins as well as return to equity. The weight of profitability of the firm to the future viability makes the ability to measure financial aspects of the firm’s operations to be a weighty matter.Ability to gauge the perception of the consumers, company’s strategic success heavily relies on how the consumers view the firm. Its is the consumers that consume sales and therefore trigger revenue generation by the organisation. For this reason, the form should seek and retain as many consumers as possible. The BSC model therefore need to be able to evaluate

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