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Management Accounting and Financial Modelling.

Undergraduate and post-graduated levels.

Aiman, the Area Manager of GEZ Berhad, realised the importance for petrol station operators to have an understanding of fundamental management accounting concepts such as cost behaviour and cost–volume–profit (CVP) analysis. He also believed that the petrol station operators should be proficient in using Microsoft Excel functionality and able to construct “intelligent” financial model with extended sensitivity analysis. Being a manager responsible for training the petrol station operators, Aiman would like to introduce the CVP concepts and spreadsheet model-building process to the petrol station operators, to aid them in planning and decision making. To construct the Excel spreadsheet model, Aiman sought the assistance of Rizal, a university lecturer in accounting, who in turn gathered the relevant operational and financial data from Baron Service Station, a typical petrol station under GEZ stable. The model should be flexible enough to allow the petrol station operator to anticipate, for example: What will happen to overall profitability of the petrol station if the fuel prices go up? What is the minimum volume of fuel that needed to be sold to break even? How much extra profit can be generated if credit card sale is reduced? and Is it viable to install an automated teller machines (ATM) kiosk and incurring administrative charges from bank to lure more customers to visit the petrol station? As the petrol station sells multiple products (petrol, diesel and convenience goods), the owner is also interested to know which product lines are the most and least profitable. Thus, the model should be able to generate segmented income statement with appropriate allocation of the common fixed costs to the each of the products.

The case discussion is intended to achieve the following learning outcomes: students are able to prepare a financial model which include a segmented contribution income statement based on the information on product mix; students are able to calculate the break-even point and distinguish between fixed and variable costs; students are able to differentiate between traceable fixed costs and common fixed costs; students are able to build a financial model that is sufficiently flexible to allow various what if analysis to be performed; and students are able to use what if analysis tools in Excel such as Goal Seek and Data Tables.

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This chapter describes the development of a two-course sequence, which explicitly breaks down the silos between the accounting and finance disciplines. A descriptive narrative demonstrates how these courses integrate introductory courses in general business, managerial accounting, financial accounting and finance, and are taught freshman year. The courses are based around an 18-chapter Instructional Narrative about a fictitious company, Windspark, which evolves from a start-up service business in the wind turbine industry to a retailer of parts and then a manufacturer. Topics are introduced as the entrepreneurs in the Instructional Narrative require business knowledge. Individual faculty members teach an entire course, rather than teams comprised from different disciplines. A diagnostic quiz at the beginning of the second course tests students’ understanding and retention of material in the first course. The vast majority of students pass the diagnostic quiz on the first try. Despite its rigor and difficulty, the sequence has coincided with a significant uptick in students choosing to major in finance and accounting. This sequence demonstrates the feasibility and replicability of teaching a truly integrated introductory accounting and finance course sequence. Greater coordination and cooperation between disciplines is possible, with measurable benefits for students.

Cost behaviour classification and cost behaviour structures of manufacturing companies. The purpose of this paper is to determine the cost structures of companies that formed part of an empirical investigation. Further aspects were investigated to determine why manufacturing companies classify cost behaviour into fixed and variable components and to determine how these companies classify specific cost items. It was found that there is a significant negative relationship between the fixed cost of a company and its degree of technological development. This means that labour intensive companies have more fixed cost as part of total costs and therefore a higher operating risk than technologically developed companies. It was also found that manufacturing companies classify cost items differently and this study provides some guidelines how to manage cost behaviour.

An increasing proportion of many companies' expenditure is incurred in distributing their products. Physical distribution covers a broad range of activities (such as transportation, warehousing, materials handling, and inventory control) that are concerned with order‐fulfilling rather than order‐getting (which is the function of advertising and related activities).

This paper aims to examine the effect of management accounting–strategy coalignment on the maqasid Shariah-based performance of Islamic banks in Indonesia. The study also examines the role of the corporate life cycle of Islamic banks in influencing the relationship between management accounting–strategy coalignment and performance.

Management accounting practices, management control systems, strategy and maqasid Shariah-based performance are measured using questionnaires which were distributed to 97 directors and heads of Islamic banks. The model of this study is analyzed using structural equation model.

This study finds that the coalignment between low cost-oriented strategy, strategic management accounting practices and mechanistic management control system has positive impact on improving maqasid Shariah-based performance. However, this study is unable to verify that corporate life cycle strengthens the positive relationship between management accounting–strategy coalignment and performance.

Limited indicators of management accounting practices in this study illustrate less comprehensive management accounting practices. Further studies may add other relevant management accounting as described by the International Federation of Accounting Committee to provide a more comprehensive management accounting practices.

This study provides recommendations to the management of Islamic banks to design management accounting practices and management control systems that fit to their strategic orientation.

This paper fulfils limited empirical studies on management accounting practices and strategy in Islamic banking industry.

Managers are constantly making decisions that affect profit. One of the decision‐making areas which is crucial to all managers concerns profit planning. Attempts to show how cost‐volume‐profit (CVP) analysis, aided by the computer spreadsheet, can be applied to the practical profit planning situation in the hospitality industry. Paradoxically, CVP analysis is one of the most widely referred to techniques in managerial accounting, but all too often it is not used to its full potential in the operating environment. Aims at encouraging greater use of the CVP approach to hospitality profit planning.

The purpose of this chapter is to present the key issues and main aspects of financial management, which also constitute the main concerns of a prospective entrepreneur.

This chapter takes a perspective of the small business/prospective entrepreneur and analyses how the methods, tools and techniques of financial management can be helpful in operating the business venture. Literature review was conducted on main issues and aspects of financial management.

This chapter builds on extant bibliography to discuss the key issues and main methods of financial management. For any business, irrespective of size, to carry on its operations and achieve its objectives, financial resources are required, and such resources must be managed efficiently and effectively.

This study is explorative in nature because the discussion is mostly based on a literature review. It takes more entrepreneurial/practical than academic approach.

To contribute to the successful and sustainable operation of a tourism venture, this chapter outlines the key financial issues and presents in a practical way the main methods and techniques used when making operational and investment decisions.

This chapter attempts to equip a prospective entrepreneur with the background knowledge (main competencies), as well as the principal methods and techniques (skills) for managing the financial resources of a venture.