Choose any organization in Abu Dhabi, to Explore, Investigate, and analysis how the following concepts applied and implemented in their business (Choose only one topic per group): 5- Responsibility...

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Choose any organization in Abu Dhabi, to Explore, Investigate, and analysis how the following concepts applied and implemented in their business (Choose only one topic per group):



5- Responsibility accounting.



How to use the budget in visibility study in new business.






1.Use updated references.


2.Organize the project as following:


1)Introduction and Literature review(1000 – 1500 Words).


2)Organization Context and Overview.


3)Methods used in Explore, Investigate, and analysis.


4)Analysis the data gathered.


5)Results reached.


6)Recommendations.


7)Presentation.

Answered Same DayJan 22, 2021

Answer To: Choose any organization in Abu Dhabi, to Explore, Investigate, and analysis how the following...

Nidhi answered on Feb 01 2021
143 Votes
RESPONSIBILITY ACCOUNTING
A. PROJECT ORGANIZATION
The Project as assigned to us is organised in the following manner:
1. Introduction and Literature review
2. Organisation Context and Overview
3. Methods used in Explore, Investigate and Analysis
4. Analysis the data gathered
5. Resulted reached
6. Recommendation
7. Presentation
1.    INTRODUCTION AND LITERATURE REVIEW
In the management of accounting there is a part that deals with the accumulation, revenue reporting and the cost that is managed based on the manager or the personnel who has the authority to take the decision regarding everyday items.
A responsible accounting is capable enough to measure the correct result of the budget
and that result will help the person who is responsible and knowledgeable enough to trace the costs and revenues. When the budget is tied up with the responsible accounting, it helps the manager dealing with it to interpret the variances. The variances that comes up maybe positive or negative in nature will prompt questions and that will lead to further explore to find the relevant answers to those questions raised. The prime purpose of the responsible accounting is to identify the appropriate person who can able to properly deal and explain the variance.
SECTIONS UNDER INTRODUCTION AND LITERATURE REVIEW
· Introduction and Summary
· Procedure under Responsibility accounting
· Definitions
· Features of Responsibility accounting
· Steps involved in Responsibility accounting
· Responsibility Centres- Cost, Profit and Investment Centres
· Advantages of Responsibility accounting
INTRODUCTION AND SUMMARY
The primary purpose of the responsibility accounting is to divide the organization into similar units. The purpose of this division is to assign responsibilities to the units based on their requirement. The units are in the form based on their divisions, departments, segments, product lines, and many more. Every department has a person assigned who is responsible to look after all the proper functions of the department. The person in charge who is also known as the manager should ensure that the person who is responsible to handle the work of the department are capable and prompt enough to achieve their goals.
A responsibility centre present in an organization is the subunit of that organization where the manager is assigned with authority to perform the responsibilities. A organization’s chart which contains the organizational hierarchy will help the determination of the responsibility centres. The common responsibility centre that can be found in an organization is the departments of that organization.
PROCEDURE UNDER RESPONSIBILITY ACCOUNTING
I. The targets that are assigned must be communicated with the managers of every department.
II. There should be a system in which the continuous monitoring will be done on the performance and based on that the results must be conveyed to the manager in charge of the particular responsibility centre which will help in the appraisal procedure.
III. The variances obtained must be sent to the management with the details of the person in charge of the responsibility centres.
IV. Based on the reports the measures for correction must be communicated with the concerned person in charge of the responsibility centre for further implementation.
DEFINITIONS
Responsibility accounting is a system of accounting that recognizes various responsibility centres throughout the organization and actions of each of these centres by assigning particular revenues and costs to the one having the pertinent responsibility. It is also called profitability accounting and activity accounting.        Charles, T. Horngreen
Responsibility accounting is that type of management accounting that collects and reports both planned actual accounting information in terms of responsibility centres.
Anthony and Reece
RESPONSIBILITY ACCOUNTING FEATURES
I. INPUTS AND OUTPUTS OR COST AND REVENUE: The responsibility accounting is based on the information that is related to the inputs and outputs and the implementation and maintenance is done through that information. The monetary term of inputs that comes are known as the costs and the monetary term of output that comes are known as revenue.
II. PLANNED AND ACTUAL INFORMATION OR USAGE OF BUDGETING: A responsibility accounting to be effective the financial information required which are actual and that are planned for the future. For the implementation of the responsibility accounting the previous data of cost and revenue is required along with the future data that is already planned. With the help of the budget preparation the implementation of the plan is communicated to every level and departments of the management.
III. IDENTIFICATION OF RESPONSIBILITY CENTRES: A big organization is usually divided into departments which are known as responsibility centre for effectively controlling the organization. The classification of the responsibility centre is done under three categories known as cost centres, profit centres and the investment centres.
IV. RELATIONSHIP BETWEEN ORGANISATION STRUCTURE AND RESPONSIBILITY ACCOUNTING SYSTEM: For a successful responsibility accounting system to be established it is very important for an effective organization structures with clear line of authority. The responsibility accounting system should be formed in such a way that it matches with the organizational structure for effective functioning.
V. ASSIGNING COST TO INDIVIDUALS AND LIMITING THEIR EFFORTS TO CONTROLABLE COSTS: For an individual to evaluate the performance only the particular costs and revenues are assigned in which the person has the complete authority.
VI. TRANSFER PRICING POLICY: the big organization has the decentralized division system where the goods and services are transferred from one segment of the organization to another segment which is the most common practice of those organizations. Therefore in the following situation the price for the transfer should be determined; therefore the proper assignment of the cost and revenue can be done. The fixing of the transfer cost has its own significance which could be determined by the sender and recipient of the goods as the sender will gain the revenue whereas the receiver will incur cost.
VII. PERFORMANCE REPORTING: The responsibility accounting is also known as a control device. The control system must have to be effective and it must report the plan at the earliest, therefore the corrective measures can be taken for the future. While the reposting of the plan can help to identify the deviations. The primary focus of the responsibility accounting is to determine the performance reports which is also known as responsibility accounting performance reports (RAPR) which is prepared for individual responsibility unit.
VIII. PARTICIPATIVE MANAGEMENT: The effectiveness of the responsibility accounting system becomes more effective when the democratic style is adopted. In the...
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