Management Accounting – Enterprise performance management

ICWA :: Final
Paper 15 : Management Accounting - Enterprise Performance Management
[One Paper: 3 hours:100 marks]

Objective . . .

•	To understand the importance of performance measurement - both financial and non financial
•	To develop the skill of decision making to have competitive advantage
•	To gain knowledge of different tools of quality management

1.	Management Control Systems	10%
	• Control Systems within the framework of the organization • The application of control systems and related theory to the design of management accounting control systems • Structure and operation of management accounting control systems • Behavioural consequences of using management accounting controls); • Variation in control needs and systems dependent on organizational structure • Management accounting system - need for detailed costing, overhead allocation and budgeting, identification of non-value adding activities in the accounting function
2.	Operations Management	15%
	• An overview of operations strategy and its importance • Systems used in operations management: Manufacturing Resource Planning (MRP), Optimised Production Technologies (OPT), Just-in-Time (JIT) and Enterprise Resource Planning (ERP). • Use of the Intranet in information management • Strategies for balancing capacity and demand including level capacity • Demand management strategies. • Benchmarking and Business Process Re-engineering (BPR).
3.	Cost Planning and Analysis for Competitive Advantage	25%
	• Value analysis and quality function deployment. • The benefits of just-in-time production, total quality management and theory of constraints • Kaizen costing, continuous improvement and cost of quality reporting. • Learning curves and their use in predicting product/service costs, derivation of learning rate and learning index. • Activity-based management in the analysis of overhead and its use in improving the efficiency of repetitive overhead activities. • Multi-product break-even analysis, including break-even and profit/volume charts, contribution/sales ratio, margin of safety etc. • Simple product mix analysis in situations where there are limitations on product/service demand and one other production constraint. • Target costing. • Life cycle costing and implications for marketing strategies. • Value chain and supply chain management • Strategic Total Cost Management
4.	Treatment of Uncertainty in Decision Making	20%
	• The nature of risk and uncertainty. • Sensitivity analysis in decision modeling and the use of computer software for 'what if' analysis. • Assignment of probabilities to key variables in decision models. • Analysis of probabilistic models and interpretation of distributions of project outcomes. • Expected value tables and the value of information. • Decision trees for multi-stage decision problems.
5.	Enterprise performance measurement systems	15%
	• Balanced Score Card, EVA • Segment Performance
6.	Quality Management	15%
	• Approaches to quality management, including Total Quality Management (TQM), Statistical Quality Control (SQC) . • The use of benchmarking in quality measurement and improvement. • Practices of continuous improvement (e.g. Quality circles, Kaizen, 5S, 6 Sigma). • Different methods of quality measurement (i.e. operational, financial and customer measures) • Contemporary developments in quality management. • External quality standards (e.g. the various ISO standards appropriate to products and organizations). • Global awards for best practices and business performance