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Section 1 – 375 words
Explain how you would apply cost concepts to the decision-making process
• ?? explain the importance of costs in the pricing strategy of an organization In the context of internal operational activity, the effective management of Costs is highly important, which is why it is at the heart of Management Accounting. You will need to expand on this, defining and discussing the role of Costs, and techniques such as Marginal, Absorption, and Full Costing. Then you will need to relate the management of costs to the pricing strategy of an organisation, explaining the impact, the influence, it has.
• ?? design a costing system for use within an organisation
Ideally for your own organisation, or those in your business sector (talk with your Tutor if this
is not possible) here you will need to design and present an outline costing system
(comprising some of the elements discussed in your response above), that is appropriate for
the selected organisation or sector-specific organisations. Bear in mind that the Costing
System must be supportive of the Cost/Pricing Strategy (such as a Cost Leadership strategy)
of the selected organisation or sector.
• ?? propose improvements to the costing and pricing systems used by an organisation
Again, ideally focusing on your own organisation or those in your business sector (talk with
your Tutor if this is not possible), propose improvements to the current Costing and Pricing
systems. Bear in mind that the improvements will need to avoid creating internal conflicts, and
should, by default, contribute positively to the organisations’ strategic objectives.
Explain how you would apply cost concepts to the decision-making process
• ?? explain the importance of costs in the pricing strategy of an organization In the context of internal operational activity, the effective management of Costs is highly important, which is why it is at the heart of Management Accounting. You will need to expand on this, defining and discussing the role of Costs, and techniques such as Marginal, Absorption, and Full Costing. Then you will need to relate the management of costs to the pricing strategy of an organisation, explaining the impact, the influence, it has.
• ?? design a costing system for use within an organisation
Ideally for your own organisation, or those in your business sector (talk with your Tutor if this
is not possible) here you will need to design and present an outline costing system
(comprising some of the elements discussed in your response above), that is appropriate for
the selected organisation or sector-specific organisations. Bear in mind that the Costing
System must be supportive of the Cost/Pricing Strategy (such as a Cost Leadership strategy)
of the selected organisation or sector.
• ?? propose improvements to the costing and pricing systems used by an organisation
Again, ideally focusing on your own organisation or those in your business sector (talk with
your Tutor if this is not possible), propose improvements to the current Costing and Pricing
systems. Bear in mind that the improvements will need to avoid creating internal conflicts, and
should, by default, contribute positively to the organisations’ strategic objectives.
Section 2 – 375 words
Explain how you would apply forecasting techniques to obtain information for decision
making
• ?? demonstrate how you would apply forecasting techniques to make cost and revenue
decisions in an organisation
Here you need to select an organisation or business sector (ideally your own) and use that as
the vehicle for your response. In essence, you will need to discuss the application of
established forecasting and auditing tools and techniques, such as SWOT, PESTLE, in
combination with an analysis of the organisation’s current and future strategic objectives, in
order to optimize the chances of achieving those objectives.
• ?? demonstrate how you would assess the sources of funds available to an organisation for a
specific project
Broadly, sources of funds fall into two groups – internal funds generated by cost savings,
efficiencies, and revenues and retained profits, and external funds obtained from
shareholders, banks, grant agencies, long-term investments, etc. You need to list, define, and
show how you would assess the availability, value and potential contribution of each of these
sources for a specific project. Ideally, this project should be one that applies to your own
organisation
Section 3 – 375 words
Demonstrate how you would participate in the budgetary process of an organisation explain
how you would select appropriate budgetary targets for an organisation
• ?? explain how you would participate in the creation of a master budget for anorganisation
For this you need to focus on your current role (or if that is impracticable, then on a recent
role) and describe how you, and managers and specialists at a similar level, contribute to the
compilation of the Master Budget – particularly as to how you ensure that your Budget format
(flexible, zero-based, programme) and your Budget requirements are in line with, and support,
the organisation’s financial situation and its strategic objectives.
• show how you would compare actual expenditure and income to the master budget of an
organization This is best answered by giving an overview of the budget monitoring process (at your
strategic manager level) and support this with specific examples of how forecast and actual
outcomes are dealt with, and then how any corrective action is fed back into your local budget
and the Master Budget.
• ?? show how you would evaluate budgetary monitoring processes in an organisation
Focusing, ideally, on your experiences in your own organisation, or previous organisation (talk
with your Tutor if this is not possible), here you need to discuss how you would evaluate the
budgetary monitoring process – that is, the mechanisms and methods used, the regularity of
the monitoring, the quality of the monitoring, and the way in which Variances are responded
to.
Explain how you would apply forecasting techniques to obtain information for decision
making
• ?? demonstrate how you would apply forecasting techniques to make cost and revenue
decisions in an organisation
Here you need to select an organisation or business sector (ideally your own) and use that as
the vehicle for your response. In essence, you will need to discuss the application of
established forecasting and auditing tools and techniques, such as SWOT, PESTLE, in
combination with an analysis of the organisation’s current and future strategic objectives, in
order to optimize the chances of achieving those objectives.
• ?? demonstrate how you would assess the sources of funds available to an organisation for a
specific project
Broadly, sources of funds fall into two groups – internal funds generated by cost savings,
efficiencies, and revenues and retained profits, and external funds obtained from
shareholders, banks, grant agencies, long-term investments, etc. You need to list, define, and
show how you would assess the availability, value and potential contribution of each of these
sources for a specific project. Ideally, this project should be one that applies to your own
organisation
Section 3 – 375 words
Demonstrate how you would participate in the budgetary process of an organisation explain
how you would select appropriate budgetary targets for an organisation
• ?? explain how you would participate in the creation of a master budget for anorganisation
For this you need to focus on your current role (or if that is impracticable, then on a recent
role) and describe how you, and managers and specialists at a similar level, contribute to the
compilation of the Master Budget – particularly as to how you ensure that your Budget format
(flexible, zero-based, programme) and your Budget requirements are in line with, and support,
the organisation’s financial situation and its strategic objectives.
• show how you would compare actual expenditure and income to the master budget of an
organization This is best answered by giving an overview of the budget monitoring process (at your
strategic manager level) and support this with specific examples of how forecast and actual
outcomes are dealt with, and then how any corrective action is fed back into your local budget
and the Master Budget.
• ?? show how you would evaluate budgetary monitoring processes in an organisation
Focusing, ideally, on your experiences in your own organisation, or previous organisation (talk
with your Tutor if this is not possible), here you need to discuss how you would evaluate the
budgetary monitoring process – that is, the mechanisms and methods used, the regularity of
the monitoring, the quality of the monitoring, and the way in which Variances are responded
to.
Section 4 – 375 words
Explain how you would recommend cost reduction and management processes for an
organisation
• ?? explain how you would recommend processes that could manage cost reduction in an
Organization. Again focusing on your own organisation, or business sector (talk with your Tutor if this is not possible), here you need to discuss the cost reduction processes that you feel should be
implemented, or reinforced. You will need to discuss processes/approaches such as zerobased
budgeting, changing to programme budgeting, cost-reduction initiatives, supplier vetting, implementing KPIs, and training initiatives, and so on.
• ?? explain how you would evaluate the potential for the use of activity-based costing
Activity Based Costing (ABC) has advantages – such as helping with future product planning,
and disadvantages – such as being potentially time consuming. For this response you need to
list these, ideally relating them to your own organisation, or your business sector, and give
examples of where the advantages might outweigh the disadvantages.
Explain how you would recommend cost reduction and management processes for an
organisation
• ?? explain how you would recommend processes that could manage cost reduction in an
Organization. Again focusing on your own organisation, or business sector (talk with your Tutor if this is not possible), here you need to discuss the cost reduction processes that you feel should be
implemented, or reinforced. You will need to discuss processes/approaches such as zerobased
budgeting, changing to programme budgeting, cost-reduction initiatives, supplier vetting, implementing KPIs, and training initiatives, and so on.
• ?? explain how you would evaluate the potential for the use of activity-based costing
Activity Based Costing (ABC) has advantages – such as helping with future product planning,
and disadvantages – such as being potentially time consuming. For this response you need to
list these, ideally relating them to your own organisation, or your business sector, and give
examples of where the advantages might outweigh the disadvantages.
Section 5 – 375 words
Explain how you would use financial appraisal techniques to make strategic investment
decisions for an organisation
• ?? explain how you would apply financial appraisal methods to analyse competing
investment projects in the public and private sector. For this you need to do exactly as asked – identify a range of investment projects available in the public, and in the private sector, and show how you would apply appraisal methods –
such as using an Investment Appraisal Checklist, or using the DCFF or IRR techniques – in
order to decide on whether to invest or not in particular organisational projects.
• ?? explain how you would make a justified strategic investment decision for an
organisation using relevant financial information Project / Initiative auditing and monitoring provides feedback and closes the loop in the capital investment decision-making process and can help identify deviations from current strategic investment expectations and help an organisation improve on future strategic investments.
You will need to expand on this, illustrating the role of financial information in this process.
report on the appropriateness of a strategic investment decision using information from a
post-audit appraisal
• Focusing on your own organisation, or business sector (talk with your Tutor if this is not
possible), you need to discuss the relevance, appropriateness, value of using information
from a post-audit appraisal – that is, carrying out an in-depth analysis of the actual costs and
benefits of an investment project after it has been implemented, in comparison to initial
expectations. (This process is very similar to the Closure – Review and Evaluation process
used in Project Management). You need to give examples of how this process has been
used, or could be used, to appraise an actual investment decision.
Explain how you would use financial appraisal techniques to make strategic investment
decisions for an organisation
• ?? explain how you would apply financial appraisal methods to analyse competing
investment projects in the public and private sector. For this you need to do exactly as asked – identify a range of investment projects available in the public, and in the private sector, and show how you would apply appraisal methods –
such as using an Investment Appraisal Checklist, or using the DCFF or IRR techniques – in
order to decide on whether to invest or not in particular organisational projects.
• ?? explain how you would make a justified strategic investment decision for an
organisation using relevant financial information Project / Initiative auditing and monitoring provides feedback and closes the loop in the capital investment decision-making process and can help identify deviations from current strategic investment expectations and help an organisation improve on future strategic investments.
You will need to expand on this, illustrating the role of financial information in this process.
report on the appropriateness of a strategic investment decision using information from a
post-audit appraisal
• Focusing on your own organisation, or business sector (talk with your Tutor if this is not
possible), you need to discuss the relevance, appropriateness, value of using information
from a post-audit appraisal – that is, carrying out an in-depth analysis of the actual costs and
benefits of an investment project after it has been implemented, in comparison to initial
expectations. (This process is very similar to the Closure – Review and Evaluation process
used in Project Management). You need to give examples of how this process has been
used, or could be used, to appraise an actual investment decision.
Section 6 – 375 words
Demonstrate how you would interpret financial statements for planning and decision making
• ?? explain how you would analyse financial statements to assess the financial viability of an
Organization.There are a number of methods that can be used in analysing financial statements, such as comparative statements, funds analysis, trend analysis, and ratio analysis. You will need to
give examples of actual financial statements – P&L Account, Balance Sheet, Cash Flow Forecast – ideally those of your own organisation or as used in your business sector – and explain how the analysis of these helps the organisation and its stakeholders to assess the financial viability of the organisation.
• ?? explain how you would apply financial ratios to improve the quality of financial
information in an organisation’s financial statements Here you will need to give an overview of how financial ratios are calculated and used to analyse an organisation’s financial statements in more depth and breadth – to gain more understanding of the financial health of that organisation – and then give specific examples of ratios – such as for Profitability, Liquidity, Activity, Long Term Solvency – and explain how these ratios enhance, illuminate, the financial information that has been made available.
• ?? make recommendations on the strategic portfolio of an organisation based on its
financial information. For this you should focus on, ideally, your own organisation, or a typical organisation in your business sector, and discuss how an organisation should reshape its product/services strategic portfolio, based on the current situation and visible trends that are apparent from its current financial information and financial and performance forecasts.
Demonstrate how you would interpret financial statements for planning and decision making
• ?? explain how you would analyse financial statements to assess the financial viability of an
Organization.There are a number of methods that can be used in analysing financial statements, such as comparative statements, funds analysis, trend analysis, and ratio analysis. You will need to
give examples of actual financial statements – P&L Account, Balance Sheet, Cash Flow Forecast – ideally those of your own organisation or as used in your business sector – and explain how the analysis of these helps the organisation and its stakeholders to assess the financial viability of the organisation.
• ?? explain how you would apply financial ratios to improve the quality of financial
information in an organisation’s financial statements Here you will need to give an overview of how financial ratios are calculated and used to analyse an organisation’s financial statements in more depth and breadth – to gain more understanding of the financial health of that organisation – and then give specific examples of ratios – such as for Profitability, Liquidity, Activity, Long Term Solvency – and explain how these ratios enhance, illuminate, the financial information that has been made available.
• ?? make recommendations on the strategic portfolio of an organisation based on its
financial information. For this you should focus on, ideally, your own organisation, or a typical organisation in your business sector, and discuss how an organisation should reshape its product/services strategic portfolio, based on the current situation and visible trends that are apparent from its current financial information and financial and performance forecasts.
