...Part A a. 3 b. 1 c. 3 d. 3 e. 1 f. 4 g. 4 h. 1 Part B Memorandum To: The owners, Synamex Effects Limited From: CGA, Controller, Synamex Effects Limited Date: March 16, 2015 Re: Current risks and issues of Synamex Effects Limited As per your request, I have presented my thoughts and suggestions on the current risks and issues of SEL, the three accounting packages, and the key steps required for initial public offering (IPO). Current risks and issues of SEL Foreign exchange risk The sales in the U.S. market segment have been growing and accounted for 25% of total revenue. In addition, the recent contract with the Los Angeles studio is chosen to purchase some of the materials in California, which has exposed SEL to foreign exchange risk. This risk could be eliminated by using natural hedging with purchases from U.S. suppliers. It could be mitigated by using hedging strategies, such as swaps, forwards and options. Financial management issue As owners, I understand the importancy of developing new ideas and testing prototypes, which are considered to be part of SEL’s competitive advange. However, it is also crucial to focus on financial management and to engage on long-term strategies to emphasize on the going-concern. Contract pricing issue The three contracts accepted earlier this year suggest the current pricing scheme does not provide sufficient revenue to cover the relevent expenses. Project cost management is critical to serve as a basis...
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...How Controllers use statistics Statistics and accounting are closely related areas and use of statistics in accounting is increasing with increasing rate. Almost every filed of accounting is utilizing statistics to make effective decisions. Controllers in accounting are professionals which directly deal with financial matters and especially in cost control and budgeting. Controllers use statistics software to analyze and interpret data that helps them to make strategic and short term decisions. Question#2.a There are many issues related to controllers while making decisions on the basis of available data. Budget forecasting is very important for controllers because this tool is used to control costs and increase revenue. Deviation of budget from actual or real budget is primary issue and controllers strive hard to minimize deviations from mean. At the start of financial year, controllers are asked to prepare budget for the complete year through using realistic approach. Deviation in the budget occurs due to sensitivity of variables. Probability is very useful and important technique used in the forecasting process. Controllers use statistics and probability technique to reduce uncertainty and variance in the data. Although probability is very useful in the forecasting but when controllers inaccurately assign probability weightage to the variables then decision will not be accurate. b. There are many variables in the data file which are analyzed in different manners...
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...discount rate (cost of capital) Chapter 1 Equity Valuation and Analysis Page 1 of 5 o Modified Model o Where all from except Stock Repurchasest = expected amount of cash to be paid in period t Equity Issuancest = expected amount of cash to be raised via equity issuances in period t o Of course the challenge is the estimated of the amount and timing of the cash flows So where do financial statements fit into all of this? o Provide a record of the past operating, investing and financing decisions and their cash flow effects o Provide a beginning point for forecasting the future Chapter 1 Equity Valuation and Analysis Page 2 of 5 Equity Analysis Process Step 1 - Understading the Past Step 2- Forecasting the Future Step 3 - Valuation • Information Collection • Understanidng the Business • Accounting Analysis • Financial Ratio Analysis • Cash Flow Analysis • Structured Forecasting • Income Statement Forecasts • Balance Sheet Forecasts • Cash Flow Forecasts • Cost of Capital • Valuation Models • Residual Income • Cash Flow • Valuation Ratios • Complications • Negative Values • Value Creation and Destruction through Financing Transactions Chapter 1 Equity Valuation and Analysis Page 3 of 5 Understanding the Past o Information Collection – SEC reports, press releases, industry and economic analysis o Understanding the Business – What is the company’s strategy, who are its...
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...Kudler Accounting Solutions ------------------ BSA/310 ----------------- --------------------------------- Kudler Accounting Solutions In any business in the 21st century Accounting is the unseen backbone of any company. Business is now all about the money. Keeping track of the money is the job of accounting, they are responsible for crunching the numbers and knowing the overall outlook of the company. The current setup of the accounting system is not bad but for a competitive edge it would be an advantage if they were updated. When the accounting system was founded, it was built for simply gathering financial data and returning that information to us for decision making. This would include key decisions in, payroll, investments, payable and receivable accounts, and sales. There may be others since accounting is such a vital function in the business. In the competitive world this is just not simply enough. So building accounting systems, will take advantage of a few new key features, and some core technologies that many of our competitors may be using to increase their business. Key Features of the New System With new system there will be quite a few additives to it. The first thing that will be done is the integrating of the new accounting system with the rest of the systems. Then bring in systems, for Enterprise Resource Planning, Supply Chain Management, Collaborative Planning and Forecasting , and Customer Relationship management. With the new system, we will also...
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...Management accounting is the internal function for the company that has the responsibility for collecting and reporting their financial information. This information also relates to the cost of the materials and the labor that is used to produce their goods and services that are sold to other customers. Businesses used this information so they will be able to determine their business operations and so they will be able to determine how much profit they will earn based on their company assets that they are using to produce their customers goods and services. The three type of accounting information that I think is important to our company is cost-allocation, budgets and forecasting. Cost allocation reports are the main function of accounting. Managers prepare the reports so it will show how much they are spending on capital for each resource and it also will show how the company will allocate these costs for the resource for the goods or services. Managers use these reports so they can determine that they are receiving the correct amount of costs and price of the goods and services that they are producing. Budgets are important to businesses because it will let the managers know how much money that they can spend on each of their business function. Companies use budgets so they will be able to set limitations on certain of their business expenditures so they will make sure that the company is not going over their limit for the resources for their business inputs. Forecasting...
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...COVER LETTER Dear Sir/Madam, I have Over 6 years of experience in group financial accounting & Financial Management in varied industry area including month end and year end consolidated reports, balance sheet reconciliation, fixed asset maintenance, budgeting and forecasting, GST/BAS and payroll tax, cash flow reporting and variance analysis. As my resume highlights, I have expertise in range of accounting areas, including the following: * Reconciliation and expense reporting * Budget creation, cost analysis, and forecasting * Vendor relations * Accounts payable and accounts receivable * Financial statements and preparation * Business accounting process improvements * Month-end analysis and reconciliation * Non-profit accounting principles * Microsoft office and leading financial software * Reporting and documentation * General ledger audits and entries My key job responsibilities in my present capacity as senior accountant include, among others, the following: * Prepare and submit annual budget. * Audit expenses & adjust for allowable reimbursements. * Management of grant accounting activities; monitoring and submitting detailed reports of financial activities to grant donors; keeping a track of incoming funds and preparing monthly income statements vs. outgoing expenses spreadsheets. * Evaluate effectiveness of business processes and give recommendations for improvement...
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...Part B: Short Case Memo TO: Alfonso & Leo, SEL FROM: Me, CGA DATE: March 25, 2015 RE: Recommendations for Accounting Software and IPO Steps As per previous discussions, as SEL continues to grow, we need to look into how it can gain a competitive edge in its market by gaining control of the financial activities of the company. With this growth, it needs to consider how to raise additional capital and how to manage the increase in employees and accounting transactions. Over the last 4 years, SEL has grown its business by 25% in total revenue. There are currently enterprise risks and issues that SEL faces due to the lack of planning, organizing, leading and controlling of its financial activities. As SEL is about to obtain a significant contract over a five-year period, it needs to gain control and put processes to operate effectively and efficiently. There are currently some weaknesses in SEL’s financial accounting and reporting system. The part time accountant with only basic accounting experience doesn’t allow SEL to have proper financial analysis or forecasting and it could cause potential accounting gaps, such as not knowing how to properly account for foreign exchange risk. With the part time accountant doing all the accounting tasks, there is no segregation of duties, proper review or approval processes in place. By not analyzing the finances or preparing forecasts, it is not allowing SEL to see where it stands financially and it doesn’t allow for...
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...companies on a daily basis. Forecasting allows managers to plan according to future events and be prepared to use the system accordingly. With a prediction of the future managers reduce uncertainty and develop plans. The historical data is put together and analyzed to determine forecast events. All large companies use forecasting to make important strategic business decision. This helps them save costs and manage their resources effectively. A firm that is prepared for future occurences will have a healthy financial position. Forecast is of great use to a company because it affects several departments throughout the company. Some of the departments affected are: accounting and finance, marketing, operations, human resources, and information systems. Budgeting, sales, production, inventory control, capacity planning, and purchasing make use of forecasting. Accounting and finance use the data collected to estimate future costs, predict profit or loss, and identify resources available. The marketing department uses forecasting to predict prices and create promotions. The operations of a company is able to run smoothly because job schedules, production schedules, capacity planning, inventory planning, and detecting outsourcing needs are predicted ahead of time. Human resources also benefits from forecasting because seasonal or cyclical hiring is scheduled ahead of time. The company’s information systems are being monitored and revised to keep up with the forecasting results. There are...
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...Accounting systems are a crucial part of the business operations system. The current accounting system at Kudler Fine Foods, while comprehensive, lacks some key features that can increase benefits and reduce loss. This system is modular in design, and is made to be scalable so additions or updates can be made and the new system can incorporate and build onto the existing system. The accounting information system is used to gather financial data and provide information for internal and external decision making. These decisions include marketing, purchasing, payroll, investments, sales, and accounts payable and receivable. The purpose of implementing a new accounting system is to take advantage of these key new features and core technologies that will help keep the company agile in its decision making. It will also make the company better prepared to compete in today’s economy and market. Key Features The key features for the proposed accounting system include integrating the accounting system with the enterprise system, auditing software, budgeting software, integrated accounting and finance software. The use of XBRL programming language for filing reports, ERP (Enterprise Resource Planning), SCM (Supply Chain Management), CPFR (Collaborative Planning, Forecasting and Replenishment), CRM (Customer Relationship Management), and KM (Knowledge Management) are also key elements of this system (Turban & Volonino, 2011) . Financial planning and budgeting, financial and economic forecasting...
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...An issue is something for discussion or of general concern difficulty; an issue is the preparation for a problem. An issue is something that needs to attention; but is not detrimental. A problem is a difficult situation that can become detrimental to a company. The Kudler Company is dealing with issues that could eventually become detrimental problems that could hinder the company if not addressed before substantial growth. Kudler foods face many issues that can eventually become problems, if not corrected. The goal of Kudler foods is to be a one stop shop with a reasonable price. The mission statement says that they shop the whole world for their products. The finest is what they guarantee their customers. One if the issues are in the process of purchasing “There is no purchasing department in any of the stores although standard purchasing procedures are in place” (Kudler Foods). The lack of a purchasing department within each store leaves room for theft by store managers and over ordering because of favors to venders. Unfortunately, if Kudler is leaving all of the purchasing to the managers except for bulk items, they are jeopardizing the integrity of the products and the company leaving it open for corruption. The solution would be to produce a purchasing department that would make purchases and verify the orders of the management and providing purchase orders to vendors. A new study suggests that nearly any worker may be willing to steal from an employer under some circumstances--unless...
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...Analysis Dechazlon Burnett, Basma Fawaz, Jon Ehm, Janice Schmitt, Jenna Snowden University Of Phoenix Accounting 561 Michael De Marco November 14, 2010 Introduction Gillermo Furniture Store Analysis Risks Associated with Sales Forecasts Sales forecasting and budgeting are important tools used to evaluate the results of the company. The sales forecasting are used as guidelines that direct the company to the right path and help the management achieve the company’s goals. The company may face many risks when forecasting or creating budget and this is related to unethical decision making. Sometimes mistakes occur either because of misrepresentation of numbers when creating a budget or because wrong decisions made by managers that aimed to increase income and resources. This will cause financial loss and failure to the company because the data used in the budget are inaccurate that will cause errors in the future numbers. According to Horngren, (2008) sales forecast is defined as, “a prediction of sales under a given set of conditions.” Forecasting is usually done using many techniques and the most important is based on data from past history to predict the future demand. The only error that may occur is that when there is a mistaken assumption in the past sales demand will continue into the future (Chase, 1993.) Guillermo Furniture store considers sales forecasting as a strong foundation to build the company’s sales budget. Guillermo recognizes the risks from using...
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...including the complete document with the sections completed to date to reflect the work to date by the analyst team. The milestone versions of the document are authorized for release only after the analyst’s signature has been obtained. Milestone 1 PREPARED: DATE:___/___/___ (for acceptance) (, signature) POSITION: ___ Milestone 2 PREPARED: DATE:___/___/___ (for acceptance) (, signature) POSITION: ___ Milestone 1 PREPARED: DATE:___/___/___ (for acceptance) (, signature) POSITION: ___ TABLE OF CONTENTS 1 Executive Summary 7 2 strategy analysis 7 2.1 Industry Analysis 7 2.2 Competitive Strategy Analysis 7 2.3 Corporate Strategy Analysis 7 3 accounting analysis 7 3.1 Overview of...
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...Make-to-order – this process is activated only in response to an actual order. Inventory (both work-in-process and finished goods) is kept to a minimum. Make-to-stock – this is a highly efficient process that produces standard products that can be delivered quickly to the customer. Hybrid – this process combines the features of both make-to-order and make-to-stock (Chase, Jacobs, Aquilano, 2005). Inventory Control Each of Kudler’s individual stores is responsible for placing their own supply orders. It is also the responsibility of the ordering manager to verify the orders for accuracy. Finally, once the orders have been placed and received, it is the responsibility of the manager to forward the shipping receipts to the accounting department for payment. It is the sole discretion of the store manager to order and stock what...
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...Financial Planning Financial planning involves budget, financial map or operating guide (Principles of Accounting, n.d.). Financial planning has many functions: a breakdown of budget, money coming in, and money going out - except the money going out is all planned and knowing where it will go or end up. Financial planning is making plans to attain that goal – money wise. Financial planning provides many elements for detailed sales targets, staffing plans, inventory production, cash investments and borrowing capital expenditures for plant assets and others. It also involves risk management. Proper financial planning gives the company guidance on how to proceed with expenses and funds. Better financial planning leads to proper prioritizing of goals and work towards long-term goals. Financial planning involves strategic plan which includes the plan that supports the mission, vision and values of the organization. Operating plans which includes a detailed guidance to help organizations realize its strategic vision. Financial Plan which involve the forecasting of financial statements, the amount of money that supports the plan, forecasting of funds, performance-based management system, and the monitoring of operations after executing the plan to check any nonconformities and take actions towards it. (Ehrhardt and Brigham, 2011). Financial planning helps the companies minimize costs and maximize profits. One method of financial planning is the Additional...
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...company this is especially true in the transportation industry. Economic, accounting , and social costs all need to be evaluated to ensure that a business can remain successful. This paper will explore these three cost concepts and provide recommendations on how to mitigate the risks associated with each. Accounting costs is the first concept. This includes all of the cash outlays of the company. This is the easiest concept to understand. The accounting costs include all of the expenses incurred by the company. This includes fuel, driver wages, wear and tear on the equipment and other costs associated with delivering the freight. When hauling truck load freight this is very straight forward but in the case of LTL freight or package delivery this becomes more difficult. Mitigating these costs can be difficult, but it can pay big dividends for the company. If a company is able to quantify all of its operations they would be able to evaluate which service is the most costly and focus on reducing this costs. Economic cost is the second cost, this is different from the accounting cost. Economic costs are associated with the alternative cost doctrine. Using this doctrine the cost of a resource is its value in its best alternative use. With this being said if a resource has no alternative use, such as a railroad trestle, it has a zero economic cost [ (Coyle, Novack, Gibson, & Bardi, 2011) ]. Accounting costs are related to money that has already been spent, economic costs...
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