ACC2360 - Managerial Accounting: Crown Resort Report Analysis

This report provides a comprehensive analysis of Crown Resort, a well-established entertainment and gaming company in Australia. It begins with an overview of the company's financial performance, including its net profit and market capitalization. The methodology involves the use of secondary data, financial statements, and audit reports. The report then delves into a SWOT analysis, identifying the company's strengths (market leadership, strong distribution, customer satisfaction, and cash flow), weaknesses (high inventory, attrition rate, gaps in product range), opportunities (cost reduction, online channel growth), and threats (workforce shortage, currency fluctuations, rising raw material costs). Porter's Five Forces model is applied to assess the competitive environment, and Porter's Generic Strategies are discussed, with a focus on cost leadership. Finally, the report prepares a Balanced Scorecard to evaluate the company's performance, concluding with recommendations for strategic objectives, including market expansion and investment in research and development. The report aims to provide insights into Crown Resort's position in the entertainment and gaming industry and suggests strategies for future growth and profitability.

MANAGERIAL ACCOUNTING
- CROWN RESORT

INTRODUCTION OF THE COMPANY-
CROWN RESORT
 Crown is well-recognized and established company in Australia which
deals with entertaining and gaming group.
 The company s headquartered in Southbank, Melbourne, Australia.
 The company ha earned a net profit of $326.7 million and holds A$8.7
billion of market capitalization in 2018.
 The company holds two more entertainment complex, Crown Melbourne
and Crown Perth.

METHODOLOGY
 The information gathered for the analysis of Crown Resort’s macro and
micro environment is through secondary data.
 The key objectives instigated in the study is parallel with managerial
accounting concepts.
 The financial data collected for the analysis and evaluation is gathered
from annual report audit reports and share price listing.

SWOT ANALYSIS
STRENGTH
 It is one of the leading organisation in Australia.
 It has strong penetration of new markets and strong distribution network
that have reached to its major potential market.
 Return on Capital Expenditure
 Skilled labours in the organization
 It provides high level of customer satisfaction through effective
customer relationship management.
 It has strong free cash flows that means it provides the resources in
hands of the company to expand its new project.
 Cost Structure of the company is advantageous
 Automation is highly encouraged

WEAKNESS
 The company have high day inventory compared to the
competitors.
 It has high attrition rate observed in workforce.
 The investment for the research and development is not up- to the
mark.
 The company have gaps in the product range that is served by the
company.
 The company is facing problem with talented employee retention.

OPPORTUNITIES
 The company can decrease the cost of transportation by low shipping
price that can trigger its profitability margin.
 By attracting new customers into the online channel can help increase
the sales margin.
 The development of market can lead to dilution for the competitor’s
advantage.

THREATS
 The shortage of workforce can be a threat to the company.
 The issues regarding currency fluctuation may impact the
company running in global market.
 The rise in the raw material can be a threat.

PORTER’S FIVE FORCE MODEL
FORCE DETAILS RISK RATING
Threat of new
entrants
 Political issues stops the entry of
new entry
High risk rating – low barriers to entry
Risk of existing
competitors Century casino
Church chill
Red Rock
High risk rating
Threat of
Substitutes
 Few substitutes
 The price offering us less than the
substitutes
Low risk rating
Bargaining
Power of the
Supplier
 Suppliers are more compared to
other buyers
 The profit margin is high
Low risk rating – low bargaining power
of supplier
Bargaining
Power of the
Buyer
 Increasing demand of the
customers
 Low income make customers
reluctant to buy
High risk rating – strong consumer
bargaining power

PORTER’S GENERIC STRATEGY
 The Porter’s Generic Strategy incorporates three main strategies which
aids the company to gain competitive advantage over the competitors.
 The company focuses on applying the combination of all the strategies,
cost leadership, differentiation and focus.
 The company is more focused on using cost leadership, as the prize of
the product and service is low as compared to competitors of Crown
Resort.
 It would be beneficial if the company put more emphasis on focus
strategy as the company should expand its business in niche market for
more profit.

BALANCED SCORECARD AND KPI
Perspectives Objectives Performance
Indicators
Targets Initiatives
Financial Revenue generation 20% more than the last
year
Expand the business Expansion of business
in USA, Australia, China
and India
Profitability 4% compound annual
growth rate
Reducing wastage 10% reduction of
wastage
Customers Gaining the attention of
customers
Customer feedback customer base increased
by 10%
Discount, offers and
new products and
service offerings
Enhancing the market
reputation
Market Survey New product and service
development with
customer preference
Customer loyalty
program
Increase in the Number of customer 2% profit Effective promotion

Learning and growth Organization culture Ethics in business Staff engagement and
interdepartmental
communication
Policies rules and
regulation must be
obliged
Talent acquisition Training programs 100% talent retention Training courses
Employee retention Reduce employee
turnover ratio
10% employee retention
than last year
Fair compensation,
continual motivation
Employee development Develop the skills and
potential of the existing
employees
Opportunities for future
development
Internal business
process
Alignment with
company guidelines,
rules and regulation
Adherence to business
guidelines and policies
Zero compliance issues Proper training and
notice
Planning and supporting
marketing activities
Increasing the number
of contacts
Feedback, marketing
researches and
corrective
Competitor and
customer analysis
Increasing the contact
numbers by 20%
Periodic feedback and
evaluation
Coordination within the
employees and
customers as well
Survey feedbacks from
the customers
Complaint minimisation
by 15%
Employee workshop

Conclusion and Recommendation
 It is concluded by the above analysis that Crown Resort is in a good
position in the entertainment and gaming industry. Since, there are
certain obstacles which needs to be measured by the company,
the company focuses on developing effective strategies. The
analysis derived certain strategic objectives which can give
support to the company and can gain good profit.
 The company should focus on expanding in the global market and
must focus on research and development department in order to
develop new products and service.
 This will foster customer retention and gain new customers as well.