Accountant in Business: CSR Report on Magical Experience Ltd

This report analyzes the Corporate Social Responsibility (CSR) initiatives of Magical Experience Ltd, focusing on the accountant's role in presenting financial statements and addressing stakeholder needs. The report defines CSR, its strategic alignment with company goals, and its application across various stakeholders, including customers, employees, and the environment. It highlights how CSR enhances brand image, builds customer loyalty, and reduces business and legal risks. The report examines how CSR activities relate to the strategic purpose, mission, and vision of the firm, emphasizing the importance of customer satisfaction and the adoption of sustainable practices. Furthermore, it presents the reasons that encourage the Board of Directors to adopt CSR practices, including reputation, relationship, and responsive attitude. The report uses examples like the video game industry and the Volkswagen scandal to illustrate the practical implications of CSR.

ACCOUNTANT IN BUSINESS
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TABLE OF CONTENTS
INTRODUCTION................................................................................................................................3
1. Stating the meaning of corporate social responsibility ...............................................................3
2. Defining the ways in which CSR is associated with the strategic purpose of company ............4
3. Stating the application of CSR in the light of various stakeholders ...........................................4
4. Presenting the reasons which encourage Board of Directors to adopt CSR practices ................6
CONCLUSION....................................................................................................................................7
References............................................................................................................................................8
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INTRODUCTION
In the organization, accountant plays a vital role in drafting financial statements according to
the standard rules and regulations. Thus, they are the one who has the responsibility to present the
business operations and functions in a fair manner in front of stakeholders. Moreover, shareholders
of the firm undertake final accounts with the aim to satisfy their information need to the significant
level. Financial statements contain information about the company's funds, solvency and aspects of
corporate social responsibility. The present report is based on Magical Experience Ltd which will
discuss the significance of corporate social responsibility. Through this, one can understand the
extent to which business organization can fulfil its aims and objectives through the means of
corporate social responsibility.
1. Stating the meaning of corporate social responsibility
Corporate social responsibility (CSR) is undertaken by corporate for building distinct image
in the mind of stakeholders. In this, business organization makes effort to assess and thereby takes
responsibility for contributing in well being of society. In this, company emphasizes on taking
initiative which offers high level of benefit to the society (Lindgreen and Swaen, 2010). Charity,
economical way of performing operations etc. are the main factors which are the part of corporate
social responsibility. Now, every company focuses on CSR activities for enhancing their goodwill at
the marketplace.
For instance: Company invests some part of their profit on children education, allocation of
house to poor persons, focus on ensuring green environment etc. Further, ethical labour practices
and organizing events are the main aspects of CSR activities which provide assistance to the
organization in contributing in welfare of others. Looking at Magical Experience Ltd, company
focuses on designing video games which offers more fun to the customers without affecting the
beliefs of others (Dhaliwal and et.al., 2011). Moreover, society is one the main stakeholders of the
company whose satisfaction highly matters for the firm. Through this, corporation can increase its
market share and enhance brand image to the large extent.
Thus, CSR may be served as a self regulatory mechanism which helps the organization in
monitoring its activities and operations in against to ethical standard as well as national and
international norms. It enables the firm to determine the actions which they are required to
undertake for the well-being of society. This in turn helps the enterprise in making positive impact
on environment and other stakeholders (Gainer, 2010). In the context of Magical Experience Ltd,
business and legal risk can easily be reduced by the firm with the help of CSR activities. Through
this, company can also enhance its long term profit and shareholders trust significantly. In this way,
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CSR activities are vital for growth and success of the firm in the highly competitive and strategic
business arena.
2. Defining the ways in which CSR is associated with the strategic purpose of company
CSR activities of the firm are associated with the strategic purpose as well as mission and
vision of the firm. Moreover, maximization of profitability is one of the main purposes of Magical
Experience Ltd by offering the quality and effectual services to the customers. Moreover, quality is
the important aspects which differentiate the product or services of one company from another.
Along with this, organization also focuses on increasing customer with the aim to enhance their
productivity and gross margin (Carroll and Shabana, 2010). In this regard, CSR activities are the
tool which helps enterprise in attaining its strategic aims and objectives. Moreover, now customers
prefer to use services of firm which contributes in the CSR activities.
In this, Magical Experience Ltd can enhance its customer base by conducting welfare
activities for the society. For instance: Magical Experience Ltd can build effective image at
marketplace by establishing hospital which will offer high medical facilities to the patients at
concessional prices. This in turn also ensures economic growth and development by creating
employment opportunities. Further, company can also attract large number of users by stating the
aspect that the firm will contribute 2% of price on children education. This is also one of the main
areas which influence the decision making aspect of customers to the large extent (Du,
Bhattacharya and Sen, 2010). In this way, CSR activities offer opportunity to Magical Experience
Ltd to fulfil its strategic purpose. Moreover, when customer base of the company is enhanced then it
may result into high level of profitability.
In the present scenario, the organization can attain success only when they have highly
satisfied and loyal customer base. Thus, Magical Experience Ltd can built satisfaction among the
customers by performing the CSR activities (Okpara and Idowu, 2013). This may turn into
customer loyalty in the near future and thereby helps the enterprise in building competitive edge
over others. For instance: Company requires lots of electricity for designing the video games.
Moreover, heater and air conditioners are the main equipments which consume lots of energy (Video
game companies & Corporate Social Responsibilities, 2016). In this, Magical Experience Ltd
places emphasizes on adopting the alternative and economical substitution of solar energy such as
solar power etc. Further, business unit also provides training to its personnel about using electricity
in an economical manner. This aspect shows the concern of business organization towards the
society (Aguinis and Glavas, 2012). Thus, by performing CSR activities Magical Experience can
develop effectual image in the mind of customers in against its competitors.
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3. Stating the application of CSR in the light of various stakeholders
Company performs CSR activities with the aim to build and maintain effectual relationship
with the stakeholders. The main aim of the company behind CSR activities is to make effectual
relationship and build trust among the stakeholders such as investors, customers, government,
employees etc. On the given situation Magical Experience Ltd designs video games for entertaining
the users (Carroll, 2015). In this, company performs several responsibilities for reducing the
environmental effects and offer benefits to the society. For instance: the organization who provides
customers with the variety of video games needs to focus on saving energy and electricity by taking
into account the number of ways.
For this purpose, the organization is required to use energy efficient lights and equipments.
Thus, by saving energy, company can offer benefit to people of the society. Along with this,
organizations which are operating in entertainment industry such as Magical Experience Ltd has
responsibility to design games in such a way which do not place any bad impact on the society
(Barnea and Rubin, 2010). From investigation it has been found that Boyd gaming fails to comply
with the Discrimination Act to some extent. Moreover, enterprise has the accountability towards the
personnel to do not discriminate them on the basis age, sex, religion etc. Hence, company should
offer equal employment opportunity to the people who possess desired level of skills and qualities
(Bénabou and Tirole, 2010). It is one of the main ethical aspects which need to be followed by the
organization in relation to their personnel.
Besides this sector, automobile is another industry which focuses on employing CSR
practices. Moreover, business operations and functions of automobile sector impact on the
environment and thereby society as well. This industry is the one which generate wastage which
may cause environmental pollution. Such sector is accountable for making effectual management in
relation to disposal of waste (Werther and Chandler, 2010). Hence, company is required to perform
their activities in the best possible manner by using alternative ways of production. Through this,
organizations which are operating in the auto-mobile sector become able to reduce air, water and
pollutions to the great extent.
For instance: Volkswagen has provided training to personnel about the ways through which
they can make optimum and economical use of the energy. However, Volkswagen fails to perform
CSR practices in an effectual manner. In the financial year 2015, Volkswagen came into light due to
its environmental emission scandal. In this, company made its cars in such a manner which turned
into high level of environmental pollution. Due to this, high level of health issues was suffered by
the people of society. This scandal has developed awareness among people of society about the
aspects of environmental pollution and its effect. In this, brand image of the firm has been
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negatively affected due to the irresponsible act performed by the company.
Hence, now a day’s corporate social responsibility is the vital part of business which helps
them in strengthening their brand image.
4. Presenting the reasons which encourage Board of Directors to adopt CSR practices
Corporate social responsibility is one of the forms of corporate self-regulation that is
integrated into a business model. These are the activities which support the society as it also
bestows its useful resources to fulfil all its requirements. CSR policy functions as a self-regulatory
mechanism whereby business enterprises monitors and ensures its active compliance with the help
of external business environment rules and regulations. They are required to use credible measures
to support the society to achieve its desired goals and objectives without any barriers in the path of
the success. CSR professionals have the opportunity to take initiative to integrate the importance of
trust across the business (El Ghoul and et.al., 2011). This method helps the organization to improve
its brand reputation and business image. The improving image in the market helps business to
increase credibility among its shareholders and various stakeholders. The focus of the business is on
three angles of a triangle which includes reputation, relationship and responsive attitude: Reputation- It is one of the important need and demand of every business to survive for
longer period in the business market. In today's highly complex and competitive
environment, brand reputation increases loyalty among various consumers which help them
to stay connected with the company (Four Types of Corporate Social Responsibility, 2016).
It can be increased by several objectives like taking each and every demand of the
customers, moulding business according to needs and expectations of the purchaser. Relationship- In every business, success plays an important role in determining the
favourable conditions of the organization. The owner uses appropriate tools and techniques
to maintain its friendly relationship with the customers, business clients, shareholders and
various sponsors and investors (Mishra and Suar, 2010). In today's competitive business
environment, relationship with the buyer is important as the consumers are regarded as a
king of the market.
 Responsive attitude- The essential quality and characteristics which every customer look for
is its personal security and safety. The products and services offered by the company will
not affect any customer's emotions, feelings and especially its health. The manufacturer's are
under obligation to deliver quality products or services according to the different needs and
expectations of the customer. The diverse needs of the customer include price affordability,
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ozone-friendly products, maintaining sustainability, health and safety measures adopted
(Orlitzky, Siegel and Waldman, 2011). The society will determine the success of the industry
if the demands are fulfilled by the company on time than the situations are favourable for the
organization and vice-versa.
CONCLUSION
From the above report, it can be concluded that by performing CSR activities Magical
experience can enjoy benefits in terms of both financial and non-financial aspects. Moreover,
perception of customers is one of the main aspects directly impact on the business performance. In
this, CSR activities are the strategies which help Magical Experience Ltd in enhancing its gross
margin level. Further, it can be revealed from the report that CSR is a key which offers assistance to
the business unit in achieving its strategic aims and objectives. It also has been articulated that
company is required to satisfy the needs of various stakeholders by performing CSR activities.
Through this, business unit can enhance its productivity and profitability.
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REFERENCES
Books and Journals
Aguinis, H. and Glavas, A., 2012. What we know and don’t know about corporate social
responsibility a review and research agenda. Journal of management. 38(4). pp.932-968.
Barnea, A. and Rubin, A., 2010. Corporate social responsibility as a conflict between
shareholders. Journal of business ethics. 97(1). pp.71-86.
Bénabou, R. and Tirole, J., 2010. Individual and corporate social responsibility. Economica.
77(305). pp.1-19.
Carroll, A.B. and Shabana, K.M., 2010. The business case for corporate social responsibility: A
review of concepts, research and practice.International journal of management
reviews. 12(1). pp.85-105.
Carroll, A.B., 2015. Corporate social responsibility. Organizational Dynamics. 44. pp.87-96.
Dhaliwal, D.S. and et.al., 2011. Voluntary nonfinancial disclosure and the cost of equity capital:
The initiation of corporate social responsibility reporting. The accounting review. 86(1).
pp.59-100.
Du, S., Bhattacharya, C.B. and Sen, S., 2010. Maximizing business returns to corporate social
responsibility (CSR): The role of CSR communication.International Journal of
Management Reviews. 12(1). pp.8-19.
El Ghoul, S. and et.al., 2011. Does corporate social responsibility affect the cost of
capital?. Journal of Banking & Finance. 35(9). pp.2388-2406.
Gainer, B., 2010. Corporate social responsibility. In Third Sector Research(pp. 187-200). Springer
New York.
Lindgreen, A. and Swaen, V., 2010. Corporate social responsibility.International Journal of
Management Reviews. 12(1). pp.1-7
Mishra, S. and Suar, D., 2010. Does corporate social responsibility influence firm performance of
Indian companies?. Journal of Business Ethics. 95(4). pp.571-601.
Okpara, J.O. and Idowu, S.O., 2013. Corporate Social Responsibility. Springer Berlin Heidelberg.
Orlitzky, M., Siegel, D.S. and Waldman, D.A., 2011. Strategic corporate social responsibility and
environmental sustainability. Business & society. 50(1). pp.6-27.
Werther Jr, W.B. and Chandler, D., 2010. Strategic corporate social responsibility: Stakeholders in
a global environment. Sage Publications.
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Online
Four Types of Corporate Social Responsibility. 2016. Online. Available through:
<http://smallbusiness.chron.com/four-types-corporate-social-responsibility-54662.html>.
[Accessed on 26th July, 2016].
Video game companies & Corporate Social Responsibilities. 2016. Online. Available through:
<http://www.sd-gaming.com/medias/articles/21-news/70-video-game-companies-corporate-
social-responsibilities>. [Accessed on 26th July, 2016].
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