Management Accounting Systems: Comparing Corus and Jindal Steel

This report provides a comparative analysis of the management accounting systems employed by Corus and Jindal Steel. Corus utilizes a balanced scorecard and benchmarking to address financial challenges, enabling strategic execution and goal setting. The balanced scorecard integrates financial and non-financial perspectives, while benchmarking helps in establishing realistic financial goals. In contrast, Jindal Steel employs financial governance and key performance indicators (KPIs). Financial governance ensures compliance and manages credit risk, while KPIs help mitigate risks associated with bad debts and cash flow problems. The report highlights the specific applications and benefits of these systems within each organization, supported by references to relevant literature.

MANAGEMENT
ACCOUNTING

TABLE OF CONTENTS
P5. Contrasting and comparing the organizations that adapt to MA systems.............................1
REFERENCES................................................................................................................................2

P5. Contrasting and comparing the organizations that adapt to MA systems
CORUS
This organization makes use of balanced scorecard and benchmarking in order to respond
their financial problems. Balanced scorecard helps is the technique that provides the holistic
thinking and the balance in between the non-financial and the financial perspectives that includes
customer, internal business, growth outcomes and finance. It helps the company in executing its
strategies effectively and on faster basis (Thomas, 2016). It supports converting a strategy of an
entity into the action with defining the appropriate objectives attached with vision, initiatives and
the measures for achieving the set goals.
On the other hand, Benchmarking helps in setting realistic finance related goals. It
enables CORUS in measuring their performance by using particular metrics and then applying it
at the time of setting the goals for the business. This tool assist an enterprise in resolving its
financial problems regarding competitive position and delay in achievement of the goals.
For example- CORUS can prepare for a strategic map that will be covering all the
perspectives and the objectives, indicators, goals and initiatives relating to it. This in turn helps
in providing a financial outlook for an entity.
Jindal steel
However, Jindal steel uses financial governance and key performance indicator as a MA
systems for the purpose of responding to the financial problems. Financial governance helps the
firm in securing its financial processes for working towards the compliance in controlled manner
(Ismail, Isa and Mia, 2018). It also enables in maintaining credit crisis for reducing the cost, in
improving efficiency and regaining the trust.
Key performance indicator is an another technique that helps Jindal Steel in mitigating
the risk in relation to bad debts in the future and resolves the problems regarding cash flows.
1

REFERENCES
Books and Journals
Ismail, K., Isa, C. R. and Mia, L., 2018. Evidence on the usefulness of management accounting
systems in integrated manufacturing environment. Pacific Accounting Review. 30(1). pp.2-
19.
Thomas, T. F., 2016. Motivating revisions of management accounting systems: An examination
of organizational goals and accounting feedback. Accounting, Organizations and
Society. 53. pp.1-16.
2