Reference no: EM132782155 , Length: word count:2500

AF705 Corporate Reporting - Qualifi

Introduction

The aim of this unit is to assist the learners in the preparation and interpretation of financial statements for a group of companies where it is prepared in accordance with generally accepted accounting principles and to understand and evaluate the key aspects of accounting theory. On the completion of the unit the learners will be able to communicate complex numerical and qualitative information effectively and solve problems in a selective and critical manner.

Scenario

You are a Junior Management Accountant for a medium-sized enterprise (ABC Ltd.) in the manufacturing sector and, in an effort to promote understanding between different departments in the organisation, you and your colleagues have been asked by your line manager to deliver a 2500 report on the role and function of the management accounts department, covering the management accounting systems operating in the organisation as well as the range of techniques used.

This report has two parts:

Part A: Produce a portfolio of completed calculations for financial statements, including income statements using variable costing. (1000 words)

ABC Ltd. has prepared the following data for the new product to be launched in January.
Standard cost per unit
Direct materials - £10.40
Direct Labour - £18.20
Variable Production overhead - £7.80
Standard variable cost - £36.40

Other data:
Fixed production overhead - £975,000 per month
Selling price - £67.70 per unit

Budgeted production data
Opening stock - nil
Production - 190,000 unit
Sales - 160,000 unit
Closing stock - 30,000 unit

Required:
Prepare budgeted profit statement for January for ABC Ltd. using different costing methods;
a) Marginal costing
b) Total absorption costing
The report must select and justify the most appropriate costing method for ABC Ltd. from the above two and offer interpretation of the financial statement of ABC Ltd for managerial decision making.

Part B: The second section of the portfolio is a 1500 word report discussing the importance of accounting and corporate reporting in modern business. This section focuses on the following areas:
1. An explanation of the principles of management accounting.
2. The role of management accounting and management accounting systems.
3. The use of techniques and methods used in management accounting by presenting calculations for an income statement using variable costing.
4. Explanation of how management accounting is integrated within an organisation.
5. The benefits of the function to the organisation.

Learning outcome 1: Explain the significance and the general impact of regulatory framework on the businesses.
Learning outcome 2: Identify and assess accounting concepts and theories.
Learning outcome 3: Understand how to implement accounting calculations and information.
Learning outcome 4: Critically evaluate and interpret the accounting information.
Learning outcome 5: Be able to study and criticise on specific accounting regulations.
Learning outcome 6: Identify and appraise key accounting policies and practices within corporate accounting.

Attachment:- Corporate Reporting.rar