Models of Accounting Analysis

Models of Accounting Analysis Historic Cost In accounting, historic cost is the first money related quality of a financial item. Historic cost is focused around the stable measuring unit assumption. In a few circumstances, assets and liabilities may be demonstrated at their historic cost, as though there had been no change in value from the date of acquisition. The balance sheet value items may subsequently vary from the accurate value (WIKIPEDIA). Principle An accounting system in which assets are recorded on an balance sheet with the value at which they were obtained, rather than the current market value. The historic cost standard is used to get the measure of capital expended to acquire an asset, and is helpful for matching against changes in profits or expenses identifying with the asset purchased, and in addition for deciding past opportunity costs (Business Dictionary). Impacts Under the historical cost basis of accounting, assets and liabilities are recorded at their values when first acquired. They are not then generally restated for changes in values. Costs recorded in the Income Statement are based on the historical cost of items sold or used, rather than their replacement costs (WIKIPEDIA). Example The main headquarters of a company, which includes the land and building, was bought for $100,000 in 1945, and its expected market value today is $30 million. The asset is still recorded on the balance sheet at $100,000 (INVESTOPEDIA). Current Purchasing Power Accounting Capital maintenance in units of constant purchasing power (CMUCPP) is the International Accounting Standards Board (IASB) basic accounting model originally authorized in IFRS in 1989 as an alternative to traditional historical cost accounting (WIKIPEDIA). Principle Current Purchasing Power Accounting(CPPA) includes the re-statement of historical figures at current purchasing power. For this reason, historic figures must be multiple by conversion factors. The formula for the calculation of conversion component is: Conversion factor = Price Index at the date of Conversion/Price Index at the date of item arose Conversion factor at the beginning = Price Index at the end/Price Index at the beginning Conversion factor at an average = Price Index at the end/Average Price Index Conversion factor at the end = Price Index at the end/Price Index at the end Average Price Index = Price Index at beginning + Price Index at the end/2 CPP Value = Historical value X Conversion factor (Account Managment Economics). Impacts on Financial Statements financial statements are ready on the basis of historical cost and a supplementary statement is ready showing historical items in terms of present value on the basis of general price index. Retail price index or wholesale price index is taken as an appropriate index for the conversion of historical cost items to show the changes in value of money. This method takes into consideration the changes in the value of items as a result of general price level, but it does not account for changes in the value of individual items (Accounting Managment). Example XYZ Company had a closing balance of inventory at 30 June 2012 equal to $10000. This inventory had been purchased in the last three months of the financial year. Assume the general price level index was 140 on 1 July 2011, 144 on 31 December 2011, 150 on 30 June 2012, the average for the year (July 2011-June 2012) was 145 and the average for April 2012 June 2012 was 147. For showing updated inventory with CPPA, we will use following formula Book value of inventory X current month general price index/ average index of three months = 10000 X 150/ 147 = $ 10204 (Accounting Education). Current Cost Accounting Current cost accounting is a procedure of accounting that attempts to give quality of benefits on the basis of their current replacement require as opposed to the sum they were purchased for (Ask). Principles It influences all the records and accounting reports also their balancing items. A fundamental principle underlying the estimation of gross value added, and hence GDP, is that yield and intermediate utilization must be value at the costs present at the time the processing happens. This intimates that goods withdrawn from inventories must be value at the price prevailing at the times the goods are withdrawn and not at the costs at which they entered inventories (Glossary Of Statistical Terms). Impacts Accounting systems that help in the preparation of financial reports, the cost accounting systems and reports are not subject to rules and standards like the Generally Accepted Accounting Principles. As a result, there is huge variety in the cost accounting systems of the different organization and sometimes even in different parts of the same organization (WIKIPEDIA). Advantages Of Historic Cost Historic Cost provide straight forward procedure. It records gains until they are recognize. Historical Costing method are still using in accounting system. Dis-Advantages Of Historic Cost Historic Cost consider as a acquisition cost of an asset and does not recognize current market value. Historic Cost only interested in allocation of cost, not in the value of an asset. It’s neglect the current market value of the asset that may be higher or lower than its suggested. It’s gives flaws in time of inflation (Study Mode). Comments Historical Costing method is still using in accounting system, it is a traditional method of accounting system it is not represent the market value of items, due to which it is not a appropriate method to adopt. Advantages Of Current Purchasing Power Accounting Current purchasing power method uses as measuring unit. It’s provide the calculation facilities to gain or loss in purchasing power due to holding monetary items. In this method, historical accounts continue to be maintained because they prepared on supplementary basis. This method intact the purchasing power of capital contributed by shareholders, so the method is important from the shareholders point of view. This method provides reliable financial information for the management to formulate policies and plans. Dis-Advantages Of Current Purchasing Power Accounting This method is only consider changes in general purchasing power, it does not consider the changes in the value of individual items. This method based on statistical index number which not used in individual firm. It’s difficult to use suitable price index. This method is failed to remove all defects of historical cost accounting system (Accounting Management). Comments Purchasing power accounting is very useful to provide financial information for management and its intact the purchasing power of capital which contributed by shareholders, its useful in inflation time so now in current time this method is very useful. Advantages of Current Cost Accounting This methods use present value of assets, instead of the original purchase price. This type of accounting is addresses the difference between historical and current cost accounting system. This method assigns higher values on the assets owned by the business. This method also used during bankruptcy and liquidation procedures to find the total loss to the owner (Ask). Comments Cost accounting provides accurate situation of the connection between specific cost and specific outputs because traces resources as they moves through company. By adopting cost accounting for business, in that way we learn resources are being wasted and which resource are most profitable (Chron).

Alibr Essay

Belonging Essay: â€Å"Sometimes it is hard to balance belonging to a group with keeping one’s own individual identity. † How has your study of the prescribed test and two texts of your own choosing either supported or conflicted with this idea? An essential element of belonging is one’s identity as it provides an understanding of the group to which one belongs. However, it is often difficult to retain one’s individuality while belonging to a particular community.This difficulty is evident in Sara Gavron’s film â€Å"Brick Lane† and Shaun Tan’s â€Å"Stick Figures† (Tales From Outer Suburbia), where both composer’s highlight the loss of individuality as a result of group conformation. In contrast, William Shakespeare’s play â€Å"As You Like It† demonstrates the converse as it highlights that it is possible to balance belonging to group while keeping one’s unique identity. As a result, by comparing th e exploration of all three composers, a responder can enhance their understanding of the influences that affect one’s sense of belonging and identity.As one becomes part of a group an understanding of their own unique identity can often be enriched. This is evident in William Shakespeare’s play â€Å"As You like It† through Orlando, whose development of a sense of familial belonging empowers his own self-understanding. This is evident through the contrast between Orlando’s initial dejected state and final sense of status. This is evident through Orlando’s early despondence in the play in â€Å"in this world I fill up a place, which may be better supplied when I have made it empty. The impersonal tone associated with ‘a place’ alludes to Orlando’s own feeling of alienation and isolation as a result of a lack of connection with others. This is reinforced through the hollow connotations of ‘empty’ which accentuate Orl ando’s lack of understanding of himself. However, this is contrasted with the conclusion of the play, as Orlando develops his sense of familial belonging with his brother Oliver. This sense of empowerment is evident in â€Å"you have my consent† where Orlando’s dominance is evidence through his approval of his brother’s wishes.This emphasises his enhanced status and identity, solely a result of his sense of belonging. As a result it can be seen that it is Orlando’s belonging to a group that nourishes his sense of identity. Antithetically, when a responder considers Sara Gavron’s film â€Å"Brick Lane† the converse of Shakespeare’s exploration becomes prominent. This evident when considering the character of Karim, a London-born Pakistani man.As a result of Karim’s cultural and religious heritage, he experiences a sense of alienation from the wider community as evident in â€Å"Go home Paki! † The derogatory term o f ‘Paki’ compounded with the incensed tone created through the exclamation, Gavron demonstrates Karim’s social alienation. It is this isolation that yields his identity as evident in â€Å"this is my home. † The blunt nature of Karim’s statement highlights his resoluteness and confidence with his own unique multicultural self.Despite this, Karim’s identity begins to waver as he becomes part of a Muslim group that fights for understanding. This is evident through the contrast in costuming used by Gavron. Initially, she characterises Karim in a combination of western and Pakistani clothes, but as he joins the group, these western elements begin to disappear. This results in Karim conforming to the dress code of the other group members, implying the loss of his own unique identity as a result of his belonging.Hence, Gavron, unlike Shakespeare emphasises that one’s sense of identity can be lost through their connection with a group. In cer tain situations it is often difficult to retain a sense of unique identity while being part of a group. This is elucidated in Shaun Tan’s â€Å"Stick Figures† where the Stick Figures are shown to be alienated from their homeland due to industrialization. Tan emphasises that by belonging to this group of isolated individuals, a person can lose their sense of identity in â€Å"faceless clod. † The

Hawthorne Studies: Impact on Modern Management Essay

The Hawthorne Studies is one of the most frequently debated phenomenons in modern work management. Evolved in the 1930’s this represents a progression from pure scientific management determined by Taylor to introduction and influence of behavioral sciences in the management of work, workers and work places. Given the long time that the theory has been in vogue and the intense research in management sciences, Hawthorne effect has provided varying interpretations briefly summarized in three main streams of thought. One group of researchers considers that the Hawthorne effect has an impact on productivity due to the effect on people’s behavior when they know they are a part of an experiment. (Champoux, 2003) (Nelson & Quick, 2003). Some others deem this to be the changes brought about due to special attention to behavior at the work place. (Jewell, 1998) (Newstrom & Davis, 2002). While yet another interpretation is that it is an effect caused by a novel change in the work environment.  (Jex, 2002) (Schultz & Schultz, 2000). These however appear to be limited explanations of the Hawthorne effect. The most significant impact of the experiments is in establishing correlation between human psychology, behavioral sciences and scientific management. (Franke & Kaul, 1978). This integration has resulted in overcoming the overly simplistic principles of scientific management by Taylor (1911). In as much as modern management is concerned the Hawthorne experiments established principles for organizing small group processes which remain relevant to this day. (Franke & Kaul, 1978). Thus the impact of these experiments have to be examined in relation to linkages established between worker productivity and social groups at work, attention to individuals and groups and finally creation of a conducive work environment within the group. These three key parameters can be applied effectively in modern management practices in concurrent spheres which results in improvement in work output once workers feel that management is interested in their welfare and devotes attention to them, increased productivity through a sense of responsibility and discipline which comes from within a group rather than from higher authority, and finally production enhancements resulting from an ideal social environment for the work group. (Mayo, 1933). Welfare of the worker through greater involvement of management is an important derivative of the Hawthorne Experiments which has applicability in modern management. The focus of the Hawthorne studies in worker welfare was determined by factors such as providing adequate breaks for rest, manipulating work hours and creating ideal environment for productivity through control of humidity and temperature. (Roethlisberger & Dickson, 1939). The implied meaning of such measures was that the management was concerned about and interested in the welfare of the worker. The workers were not as much concerned of the issue of genuineness of interest or productivity related needs of the management in their welfare. In the modern management context however large scale mobility of the work force is related to two spheres, availability of greater opportunities and a perceived sense of selfish rather than proportionately altruistic interest of the management in welfare of the work force. Where workers feel that the management is interested in their welfare only as a measure of productivity, it may not have a singular impact. Creating intrinsic sense of responsibility within a group is one of the prime motivators at work which can result in increased productivity. The Hawthorne experiment proved this dictum by manipulating experiments in various ways and also by creating a sense of permanency in the work groups. The groups seem to select themselves and enhance their commitment and productivity. (Mayo, 1933). In modern management creating sense of responsibility may be considered a function of effective group formation as well. This will result in a sense of purpose creating accountability of individuals to the group. Ironically the John Henry effect, frequently considered as the opposite of the Hawthorne effect supports this premise. Here a control group which is devoid of interventions enhances its efficiency by benchmarking performance based on the experimental group. (Zdep & Irvine; 1970) Thus implying that creation of group cohesion and a sense of responsibility towards productivity may lead to incremental improvements independent of interventions per se. However mere creation of a group may not sustain productivity, this will have to be supported by a conducive community atmosphere within the group. Social environment of the work group surely has an impact on worker productivity. (Mayo, 1933) (Gillespie, 1991). While work place manipulation has become a norm for greater productivity in modern production houses, it is the management of groups which is critical to the same rather than provision of physical improvement of work place beyond a certain limit. Social environment of the work group has impact at two stages in the modern work place. One is the repetitive nature of work performed by groups similar to those in Hawthorne studies. The other more complex form is work frequently carried out in a series, where an error in the chain could compound or negate the entire process. Thus the need may be to build much deeper social networking amongst groups to support not just productivity but also creativity and emotional bondage. Some of the areas which could be envisaged in this sphere are software development where relay chain nature of work would imply need for positive social environment within the work group for completion of the task with minimum errors. A critical examination of the study would reveal that most examinations have focused on the nuances of conduct of experiments rather than the overall impact of these trials. While Elton Mayo had good reason to deliberate on the experiments as this was the first time such scientifically controlled experiments were being undertaken linking behavioral sciences with industrial management, there is a tendency in subsequent works to focus more on the experiments per se rather than findings of the research derived from manipulating the processes of work. Thus critics are restricted to the integrity of the process of experiments thereby missing the essence of the argument of Hawthorne Experiments. This anomaly would be evident in the argument of novelty at the work place. (Jex, 2002) (Schultz & Schultz, 2000). The case of innovation is seen by some writers as incongruent with the conclusions as it was considered difficult to maintain novelty over a period of two years. Yet recycling newness could create conditions in the experiment which to the workers could bring about change thereby resulting in productivity improvements brought about by transformations in small work groups. A second critique of the Hawthorne experiments involves political interpretation of exploitation of workers by capitalists. (Rice, Nd). The argument that the management was interested in workers welfare has been interpreted in a way that it was not interest in the employee per se that had involved the management but the need to increase productivity. This may have relevance when attempting to understand the phenomenon of industrial polity in the modern workplace; but will not be relevant to the issue of application of the conclusions as given above in improving worker productivity. However given the extensive interpretation of the Hawthorne experiments over the years, it can be assumed at this stage that the political bias if any has been removed through the rigor of analysis by a vast body of researchers. One final critique of the Hawthorne studies in relation to modern management would be the underlying lack of importance to the group leader which is implicit in the experiments. The small group was allowed to manage through processes which do not seem to have entailed evolution of a group leader. This appears highly unusual given the natural proclivity of a primate to emerge in a group of people. In a modern setting of say software development, given the serial nature of work and equity in capability, yet importance of nominating a group leader for work group coordination has been highlighted. Nonetheless despite these and other infirmities, Hawthorne studies will continue to remain significant in modern management for the linkage provided for the first time between scientific managing, behavioral sciences and development of potential through principles of human resources.

Sun Tzu’s Art of War and The Global War on Terror Essay

Art of War is one military tactical text that has survived for centuries. The author of the text, Sun Tzu left the world with knowledge to carry on for generations. Art of War is a compilation of Tzu’s military strategies, various principles passed down his ancestral clan, and Taoism for the world to study and understand (Galvin and Giles). The military strategist specializes in the manners in which a â€Å"small force can overcome a powerful enemy† (Galvin and Giles 15). These tactics have been demonstrated throughout history by various â€Å"underdogs;† during the Revolutionary War, WWI, and even today in the Global War on Terror (Galvin and Giles 21). This is why Tzu remains an important piece of literature for all to read. Tzu’s principles on†¦show more content†¦Sun Wu’s father; Chen Shu, was the last of Chen Wuyu’s sons, revered for his military prowess (Huang 17). Unfortunately, the greed of power consumed Chen Shu’s se cond brother; Chen Qi, and threatened the lives’ of the Chen; power became more important to Chen Qi than family (Huang 17). This led Chen Shu to send Sun Wu to the state of Wu for safe keeping (Huang 17). By this time, Sun Wu had reached adulthood and was knowledgeable in military studies (Huang 17). Upon his arrival to the state of Wu, Sun Wu met with the King of Wu to who looked favorably upon his â€Å"theories on military affairs† (Huang 18). After this meeting, Sun Tzu commanded troop discipline as well as assisted General Wu Zixu in devising a strategy of expansion for the King. Their strategy weakened and eventually led to the invasion of the state of Chu (Huang 18). After the death of King Helu, the new King did not hold the same respect for the tactics and knowledge of General Wu (Huang 15). This led to a great conflict and eventually led to General Wu committing suicide and Sun Wu’s father’s death. After Sun Tzu learned of this, he entered a li fe of seclusion until his death. While his life was relatively restless, Sun Tzu left his book for the world to study and implement (Huang 15). The beginnings of Sun Wu’s military training began with his clan; knowledgeable in the art of war, however; historians remain at odds as to how heShow MoreRelatedSun Tzu On Nature And Character Of 21st Century Warfare2528 Words   |  11 PagesSun Tzu on the Nature and Character of 21st Century Warfare Sun Tzu understood the nature of war as â€Å"the province of life or death,† and a â€Å"matter of vital importance to the state.†1 I agree. In my own experience, war awakens your primordial instincts and strips you of your self-rationalizations. Sun Tzu defined the character of war when he wrote, â€Å"water has no constant form, there are in war no constant conditions.†2 Accordingly, Sun Tzu’s principals of war offer a framework adequate to explainRead MoreThe Character Of 21st Century Warfare2508 Words   |  11 Pagescharacter is highly adaptive.1 Sun Tzu claimed â€Å"all warfare is based on deception.†2 Consequently, his principals of war offer a good framework to explain the character of 21st century warfare, which I rationalize as a near-continuous battle of ideologies fought through asymmetric means to advance the values and interests of state and non-state actors. I will first introduce contemporary evidence of 21st century warfare, and then select Sun Tzu’s principals of war – national unity, rational appraisalsRead MoreContemporary Issues in Management Accounting211377 Words   |  846 PagesBromwich has made. He played an important role in the diffusion of modern practices of capital investment appraisal in the United Kingdom. He has been constantly open to the insights which advances in economic theory can provide into the accounting art, in many areas pushing at the frontiers of international knowledge in his own quiet way. In the area of costing, Michael has undoubtedly deepened our understandings of both conceptual and practical issues, in recent years providing a voice of reason