Strategic Financial Analysis: ABC Model Application in MYOB Company

This report delves into the application of the Activity Based Costing (ABC) model within MYOB (Mind Your Own Business), a software solution company. It examines how MYOB, a leading provider of taxation and accounting software for SMEs in Australia and New Zealand, can leverage the ABC model to enhance its business strategy. The report covers the ABC model's principles, its advantages in identifying cost drivers and improving profitability, and its role in supporting better decision-making. Furthermore, it discusses MYOB's mission, vision, and overall business strategy, emphasizing sustainable growth and stakeholder value. The application of the ABC model is explored in detail, including its use in cost allocation, budgeting, and forecasting. The report also recommends the use of accounting management tools like the Balanced Scorecard and value chain analysis to improve organizational performance. In conclusion, the report highlights the importance of accounting management in fostering a strong internal environment and supporting long-term organizational success.

Table of Contents
Introduction.............................................................................................................................................2
ABC model...............................................................................................................................................2
Mission and Vision...................................................................................................................................2
Business Strategy.....................................................................................................................................3
Apply the ABC model...............................................................................................................................3
recommendations...................................................................................................................................4
Accounting Management Tools...............................................................................................................4
conclusion................................................................................................................................................5
References...............................................................................................................................................5

Introduction
The main aim of the assignment is to understand in detail the role of Activity based costing
system in the organisation and how organisation can greatly benefit by implementing them. The
company which is considered for the study is MYOB (Mind your own business), a leading
software solution company focuses on the software solution on taxation and other key aspects for
the small and medium sized business in Australia and New Zealand. The company provides
software products and services to these business through proper accounting aspects, payroll
processing, taxation services, point of sale, CRM etc. The SME solution department intends to
offer clear solutions to the SME sector to manage their business in a sustainable manner. The
practice solutions department intends to provide business related software and accounting
practice systems for professionals. The company offers various software solutions to the
accountants, book keepers and others through its products like pay direct, MYOB advanced,
MYOB pay etc. It also offers client accounting software system, practice management aspects,
taxation and other record management aspects for the organisation.
ABC model
The ABC model is an accounting method that allows a company to associate resource-based
costs with the business process, not just for products or services. With this template you can
allocate and allocate resources and other costs related to the products you usually use. It should
be noted that the ABC cost system does not exclude costs and, on the other hand, helps provide
more detailed cost information and display user-based products. . The main advantage of the
activity-based cost model is that it allows the boss and auditor to understand overhead and lead
product-based products. Management can improve profitability by carefully monitoring total cost
and performance, improving business process efficiency and helping identify costs at different
levels of production or service. In addition, this model encourages the organization to focus on
improving the quality of products and services, such as TQM, and constantly improving the
process, which improves the design and control of the organization's various processes. and will
be inclined to associate with business strategy to make effective decisions. Using the ABC cost
model, the company identifies waste or process efficiency and measures to eliminate them by
visibility of activities without activities. In addition, the ABC cost method helps managers make
clear pricing, construction or purchase decisions, budgets and forecasts, etc., which mainly
includes construction costs. (Brigham, 2010)
Mission and Vision
The company's main goal is to increase the company's growth in a sustainable manner and
increase the value of all stakeholders, including employees, customers, suppliers, shareholders,
business partners and communities. The company tries to take preventive measures to avoid
harmful effects on individuals, communities and the environment and try to develop best

practices in the industry. The company has a strong mandate to establish security measures in
order to safeguard the environment in a sustainable way to integrate business. (Titman, 2010)
Business Strategy
Corporate management mainly manages the diversification of the business portfolio, extracts and
trades different products and sells them in different geographic areas and currencies. This
improves operational efficiency and reduces the effects of business variations and the business
cycle in the organization. The company intends to maintain sufficient profit margins for the
benefit of all stakeholders. Management will clearly work for a broader operational strategy,
long-term feasible procedures, identifying opportunities for expansion and resource use and
resources. sustainable way. (Berman, 2013). Driving is designed to reduce operating costs and
increase efficiency by improving new manufacturing methods, reducing internal automation and
robotics costs and automating to achieve more profit for all. continuous development methods
based on the functional model. The operational management model is very simple and seems
surprising in all areas of the business, creating a competitive advantage in the process, improving
work, organizational measures and performance. The management has implemented SAP
Process Verification, which ensures that the company has the usual way of running the process.
Management has a global perspective and establishes criteria that ensure continuity in the supply
of basic commodities, uses effective measures, develops sustainable management and asset
management systems. (Ray, 2011). The company aims to influence the overall application of
standards across all asset classes based on international considerations. Management always
includes detailed planning and effective employment contracts and clearly supports training and
access to creative decisions.
Apply the ABC model
The primary goal of leadership is to consider the ABC model as a business model that focuses on
improving corporate governance through older, present and future companies. The use of the
ABC model requires significant management support and commitment. auditors need to improve
the business process and accounting conditions for carrying out the ABC analysis. (Bragg, 2017).
The template should be limited to the previous information, but also to the budget and the
prediction of information and information. Cost allocation values must determine the costs and
data specified in the model, which will reorganize the cost segments for each segment, business
functions and services at different geographic locations, and evaluate the company's ability to
spend on commodity processing and marketing. By implementing the ABC model, auditors can
prepare and report to senior executives who help them make quick decisions about construction,
procurement, budgets and other areas. (Weygandt, 2011)
ABC is a clear and sophisticated tool for the total spending budget that generates business
forecasts, including revenues, investments and other key actions. This model will be a clear tool
for detecting future expenses, planned operations and surpluses or deficits. The amount and
information in the budget helps to eliminate waste and avoid inappropriate treatment activities.

The model will help the management to clearly understand the error margin in the manufacturing
process. It should be noted that in today's competitive environment can not cope with financial
errors, management needs to better understand resources, prices, capital budget, production line
and technical aspects. Drivers must analyze the competitor better and be aware of the cause and
effect, resulting in costs and commitment to process development. These considerations allow
management to achieve production costs, allocate resources efficiently, allocate all related costs
and improve company profitability. (Brooks, 2012)
recommendations
Management of Participation: The management of the organization must be creative and provide
all the resources of the accounting team for carrying out the ABC analysis. It should be noted
that implementation of the ABC model in the business model is a strategic decision, which
means that accountants and financial managers decide to improve business processes.
Support for business executives: A business's business process is beyond geographical
boundaries, so management must engage entrepreneurs in a smooth transition of ABC's business
model. The company can apply for new and innovative technology to get business support and
apply the ABC model to an appropriate location
Accounting Management Tools
Balanced Scorecard is one of the most important ways to do business. The rest helps the
company and management, especially the auditor, to evaluate the machine's protection and
investment. The balance is very weak for finance, customer, innovation and internal analysis of
the company. Scorecard Scale contributes to the company's work in line with the company's
vision and long-term strategy. The panel contains economic perspectives, internal perspectives,
organizational skills and finally customer perspectives. One of the most important benefits of
Balanced Scorecard is to improve the process and encourage employees to achieve
organizational goals. In particular, employment growth, especially customer satisfaction
analysis, looks at the process of increasing economic profitability. Internal perspective: (Kaplan,
2011). The internal perspective is largely linked to a business concept that determines individual
individuality, depending on customer needs. The boss needs to focus on critical business to meet
customer needs. Organization capacity: It is related to efficiency and organizational innovation.
Companies like IBM and SAP ERP, part of Balance Scorecard, are part of the understanding of
innovation opportunities. Customer data must be based on the understanding that customers are
satisfied with the products and services they want or not: You respond to products and customers
about service information, so the leader can count on customer satisfaction and innovative
products. Financial plan: Data collection and time are still critical at this stage, and the
Agriculture Minister provides financial requirements for analyzing financial information.
Value chain analysis is another way of analyzing production costs. Value chain analysis is based
on the delivery of finished products at different production or transformation stages. One of the
most important benefits of value chain analysis plays an important role in the development of

high-quality business customers. The tool is used to analyze the activity, value chain and
evaluation and design. Business Analysis: Businesses must now identify activities that help
produce goods and services. Value analysis: Analyze the value chain, value added to each
production phase and generate valuable products. Evaluation and Planning: Finally, we evaluate
the plan that evaluates possible changes and action plans. The company is based on relationship.
These quotas show the company's actual capacity and growth. The business case contains several
indicators that help the company and the investor to understand how the business generates
profits or losses. In addition to profitability and corporate accounting, return on investment and
operating income includes sales of goods and services. This is one of the most important tools
that show the actual cash flow and the actual production of the business.
conclusion
From the above it has been found that accounting management is very useful for supporting
long-term organizations. Account management techniques help create a strong internal
environment for organizations. Use different tools and techniques to describe your thoughts in
your eyes and ears. ABC's costs are largely based on the activities performed during the
manufacturing process. In addition, TQM technology is a technology that provides quality
products and services to the organization, reduces waste and improves productivity. Finally, the
auditors are responsible for managing the internal financial system through planning and control,
monitoring, decision making and law building.
References
Berman, K. (2013). Financial Intelligence. 2nd edition. Harvard Business Review Press.
Bragg, Steven. (2007). Throughput Accounting: A Guide to Constraint Management. 1st edition.
Wiley & Sons
Brigham, E. F. (2010). Financial Management: Theory & Practice. 5th edition. Cengage
Learning.
Brooks, R. M. (2012). Financial Management. 4th edition. Prentice Hall.
Kaplan, R. S., & Young, M. S. (2011). Management Accounting. 3rd edition. Prentice Hall.
Ray, G., & Eric, N. (2011). Managerial Accounting. McGraw-Hill/Irwin.
Titman, S. J. (2010). Financial Management. Prentice Hall.
Weygandt. (2011). Managerial Accounting: Tools for Business Decision Making (6th ed.).
Wiley.