Navigating Success: Unveiling Management Accounting Practices at Golf England Limited

Introduction

Golf England Limited is one of the most noticeable companies operating in the UK, which manufactures and sells the products used for golf. The organization is known for its high operational efficiency and excellence in the business markets of the country. It is found that Golf England Limited, the organization has an annual total sale of £2 million. Along with this, the opening inventory of the company is £270000 while closing inventory is £125000. There are many departments and processes in Golf England Limited, which contribute to organizational excellence and developing the products.

The purpose of the current report is to introduce the management accounting activities and practices that can be seen in Golf England Limited. The report initially describes different management accounting types and their benefits along with their relationship with business processes. Further, there is a focus on the production of financial reports in Golf England Limited for interpreting the data to manage the business. Furthermore, the report also sheds light on planning tools that are used by the organizations to solve the financial problems and acquiring sustainability in the business markets.

1. A critical evaluation of how management accounting systems and management accounting reporting is integrated within organizational processes

Management accounting

Management accounting can be defined or understood as a process in organizations through which information related to the finances and resources is provided to the managers (Bhattacharyya, 2011). Management accounting allows the managers in an organization to make effective financial decisions enhancing the probability of obtaining desired outcomes.

Types of management accounting

There are many types of management accounting, which are explained in the following way.

Product costing and valuation: In this type, organizations focus on the cost involved in the production of goods and services.

Cash flow analysis: This type of management accounting focuses on the flow of the cash or funds available to an organization inward or outwards.

Inventory turnover analysis: This accounting type is developed to calculate the times an organization has sold or replaced its inventories (Mehta, 2016).

Financial leverage metrics: In this management accounting, an organization focuses on the borrowed capital and the assets or return over-investment due to the borrowed capital.

Budgeting, trend analysis, and forecasting: This management accounting allows the managers to show quantitative expressions along with financial details for future plans.

Management accounting systems and their benefits to Golf England Limited

Cash flow analysis: Golf England Limited considers the cash flow analysis management accounting, which allows the organization to keep detailed records of finances. Based on the flow of the cash, the managers in the organization formulate the plans through which inward cash in Golf England Limited can be higher than outward cash (Singh, 2016). This analysis also helps the organization to evaluate the efficiency of the projects and operations, which have been accomplished in the past.

Budgeting, trend analysis, and forecasting: It is also one of the astounding management accountings that can be seen being used in Golf England Limited. The study indicates that the practice allows the company to allocate the budget to the operations and projects with proper analysis of the trends (Banerjee, 2017). These approaches usually enhance the productivity of Golf England Limited and result in inaccurate forecasting.

Techniques and methods used for management accounting reporting

Many methods are used for management accounting reporting in Golf England Limited. These techniques or methods are explained in the following way.

Cost reporting is one of the techniques in Golf England Limited for management accounting reporting. In this technique, the account managers consider developing the cost report in which expenditure made by the organization and their details are given.

Budget reporting is another technique in which the budgets allocated by Golf England Limited for every activity related to the operations are described (Bhattacharyya, 2011).

Another technique, which is used in Golf England Limited for management accounting reporting is the use of execution reports. It is found in the study that the execution reports contain the actual details, which are exhibited by the organization (Mehta, 2016).

This is how many techniques and methods are considered in Golf England Limited for management accounting reporting.

Relation of management accounting to organizational departments and processes

Management accounting covers the financial and resource details corresponding to all the areas and business functions. It is found in many studies that in management accounting information regarding budgets and the funding resources are provided. It can be understood that different departments in an organization such as production, supply chain, marketing, and many more have different budgetary needs (Singh, 2016). Therefore, management accounting allows the strategic managers in Golf England Limited to allocate the resources as per the needs of different departments and processes. With this information, it can be said that there is a close relationship between the management accounting and the departments and processes of an organization.

2. Production of financial reports and accurately applies and interpret data for a range of business activities

Planning tools

There are three planning tools, which are used in organizations. These tools are explained in the following way.

Budget manual: These are the documents in which an organization makes entries regarding every activity that has to be performed in upcoming operations. Budget manuals can be used in Golf England Limited at the time of planning the operations. This document can provide a comparative evaluation of the budget of existing as well as previous years in organizations (Banerjee, 2017). The budget manual also allows the companies to understand the need for the activities and their significance. A disadvantage associated with the budget manual includes the lack of reason behind the increased or decreased budget.

Balance sheets: It is the final representation of all the activities and the financial approaches considered by an organization for accomplishing its operations. The use of balance sheets of previous years while planning may have significant advantages to Golf England Limited. The managers can easily evaluate the approaches in which large expenses were made along with the respective profitability (Kotas, 2014). This is how the managers can improvise their decisions based on the statistics in balance sheets. Disadvantages associated with the use of balance sheet are that it does not contain the sets of current situations, which may affect the operational efficiency and planning.

Variance: it is another major technique, which is used in Golf England Limited while planning. Variance indicates the differences between the actual and the planned outcomes and approaches. These approaches can be much effective in analysing the risks and taking actions to resolve them (Nørreklit, 2017). The disadvantage with the use of variance technique includes the lack of justifications and reasons.

Use of planning tool to control the budget of Golf England Ltd

It can be said that the different tools and techniques for planning can be used in Golf England Limited for controlling the budget of the operations in the business markets. Budget manuals can be much effective and useful for this purpose. These manuals contain the description of all the activities related to operations of the organization as well as the budget allocated for them (Kotas, 2014). Strategic managers may evaluate the needs of the budgets for different activities. In addition to this, it can also be said that the use of balance sheets can be greatly helpful in controlling the budgets. These documents contain information about the investments made by the company as well as the profitability and the revenues acquired in return to that investment. This information can be much helpful for the strategic managers in Golf England Limited to identify the potential areas for more investment and the areas from where the budget can be reduced. This is how; different tools and techniques can be used in Golf England Limited to control the budget.

Use of planning tools to set up a future budget for Golf England Ltd

Based on the above analysis, it can be said that the planning tools and techniques of Golf England Limited can be used to set up a future budget. The following are the statements justifying these arguments.

Balance sheets of an organization contain details regarding the investment and the activities performed in the past (Nørreklit, 2017). This can be information about the profitability generated by the company as well as the losses faced. The strategic managers may improvise the budget and investment in the next financial years based on the outcomes described in the balance sheets.

Budget manuals can be used in Golf England Limited for analysing the prominent approaches and practices for which immense budget needs can be observed. These documents can be preserved by the organization and can be used in the next financial years to invest in the business processes and map the existing approaches with previous approaches (Banerjee, 2017).

Use of planning tools for solving financial problems

The planning tools such as balance sheets and many others, also contain the resources, which can be used by an organization for acquiring funds and finances. It can be analysed that most of the financial problems for Golf England Limited can be related to the availability of the funds for accomplishing the operations and its proper allocation to different activities (Ward, 2012). Therefore, financial planning tools may indicate the potential sources from where Golf England Limited may acquire the funds such as investors, shareholders, banks and many more. Information about acquiring credits and finances can be easily extracted with the analysis of the planning tools. In addition to this, the tools may also allow the company to divide the budget as per the activities and approaches involved in the operations. This is how; the planning tools may resolve the financial problems of Golf England Limited.

An evaluation of how planning tools for accounting respond appropriately to solving financial problems to lead organizations to sustainable success

Organizations and their current management accounting systems

There are two organizations, whose current management accounting systems are analysed below.

Amazon: Management accounting system, which is currently used in Amazon, is budgeting, trend analysis and forecasting. In many studies, it is found that the strategic and accounting managers in Amazon consider evaluating the trends present in the business markets and set the prices of its products accordingly (Banerjee, 2017). In addition to this, the organization also works over the business forecast and interpretations, which allow the managers to understand the probability of success.

Tesco: It is another major organization operating in the UK, which considers the management accounting system of product costing and valuation. The organizations consider evaluating the impacts of decisions taken over the value of the products (Goretzki and Strauss, 2017). This is how strategic managers in Tesco consider taking the decisions through which they can enhance the value of their products and operate excellently in the business markets of the UK.

Use of planning tools to solve problems in organizations

The use of planning tools may allow the organizations Amazon as well as Tesco to enhance the efficiency of their decision-making process and acquire efficiency. Approaches of mapping and analysing the financial details may allow these companies to evaluate the investments which have resulted in waste for the company (Adler, 2013). Also, the companies may evaluate the decisions taken in the past and the investments providing financial benefits. This is how; the planning tools can be used to resolve the problems.

Sustainability with management accounting for organizations

Management accounting has a close relationship with the sustainability of Golf England Limited. These approaches allow the strategic managers to understand the available resources as well as the activities and requirements for future operations. Based on the availability of the funds and resources, the strategic managers in Golf England Limited can take many effective decisions, which are likely to provide long term productivity and profitability (Kotas, 2014). This is how; management accounting also contributes to driving sustainability to the business of Golf England Limited.

Resolution of financial problems of organizations with management accounting

Management accounting is one of the best practices that can be used by Golf England Limited to resolve its financial problems. With the use of management accounting, the strategic managers in the organization can evaluate the financial needs for the projects and operations as well as the available resources, which could be used to acquire funds (Singh, 2016). Not only this, but management accounting also allows the company to allocate the funds as per the resources. This way, Golf England Limited can easily resolve the problems related to finances.

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References

Adler, R. (2013). Management Accounting. UK: Routledge

Banerjee, B. (2017). FINANCIAL POLICY AND MANAGEMENT ACCOUNTING. UK: PHI Learning Pvt. Ltd

Bhattacharyya, D. (2011). Management Accounting. UK: Pearson Education India

Goretzki, ‎L. and Strauss, E. (2017). The Role of the Management Accountant: Local Variations and Global Influences. UK: Routledge

Kotas, R. (2014). Management Accounting for Hotels and Restaurants. UK: Routledge

Mehta, B. (2016). Cost and Management Accounting: Latest Edition. UK: SBPD Publications

Nørreklit, H. (2017). A Philosophy of Management Accounting: A Pragmatic Constructivist Approach. USA: Taylor & Francis

Singh, S. (2016). MANAGEMENT ACCOUNTING. UK: PHI Learning Pvt. Ltd

Ward, K. (2012). Strategic Management Accounting. UK: Routledge.