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An adjusted material flow cost accounting framework for process waste-reduction decisions in the South African Brewery industryFakoya, Michael Bamidele 03 1900 (has links)
While contemporary environmental problems arise partly from increased industrial activities resulting in waste creation, the continued extraction and depletion of earth’s natural resources by organisations to meet consumers’ demand have led to unsustainable business practices (Jennings & Zandbergen 1995). Moreover, reversing the negative environmental impact caused by unsustainable business practices is the responsibility of the organisations whose activities cause harm to the environment (Ahuja & Khamba 2008). More importantly, managers require adequate and accurate financial and non-financial information on their unsustainable business practices to successfully manage both internal and external environmental effects of their actions (Schaltegger & Burritt 2000). But the lack of contemporary management accounting tools to capture waste information in the brewery process reduces the chance to improve waste-reduction decisions while opportunities for cost savings are also lost. Admittedly, Gale (2006:1231) argues that conventional management accounting Systems (MASs) do not have the ability to adequately monitor the increasing material costs and overheads in production processes with sufficient transparency. Nevertheless, this inability to provide adequate process waste information may likely limit organisations’ effort to implement and achieve desired waste-reduction strategies. As a result, it is imperative to integrate both physical and monetary waste information for sound decision-making.
The main objective of this study is to adopt and adjust the existing MFCA framework to support and improve on managers’ process waste-reduction decisions in the South African brewery industry. In order to achieve this main objective, the study:
• examines the extent to which conventional MASs provides process waste information to support waste-reduction decisions in a micro-brewery (Hope Brewery) and a large brewery (SAB Ltd);
• assesses the impact of insufficient process waste information as provided by the conventional MASs on brewery waste-reduction decisions in a micro-brewery (Hope Brewery) and a large brewery (SAB Ltd); and
• adjusts the existing MFCA framework to include waste categories subsumed or neglected in the provision of waste information to improve brewery waste-reduction decisions.
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The study adopted an exploratory multiple case study approach by means of in-depth interviews and a pilot study in two breweries- a micro-brewery and a large brewery to achieve the study objectives.
Findings revealed that, while the use of technology is essential to reduce brewery process waste, there is lack of appropriate waste-capturing management accounting tool in both organisations. Besides it is essential for organisations to adopt appropriate management accounting tool to capture waste-related information for improved waste-reduction decisions and selection of appropriate waste management strategy. The study therefore suggests the adoption of an adjusted MFCA framework for a more robust approach to improve waste-reduction decisions since ‘what cannot be measured cannot be managed’. / Management Accounting / D. Comm. (Management Accounting)
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Using environmental management accounting to investigate benefits of cleaner production at a paper manufacturing company in Kwadakuza, KwaZulu-Natal : a case studyDoorasamy, Mishelle January 2015 (has links)
Submitted in fulfilment of the requirements of the Master of Technology degree in Cost and Management Accounting, Department of Management Accounting, Durban University of Technology, Durban, South Africa, 2015. / Environmental degeneration, market pressures and stricter regulation and waste legislation has placed organizations under tremendous pressure to change their current processes and adopt cleaner production (CP) techniques and technologies. However, in countries like South Africa, CP implementation still remains low. In light of this problem, the government has made efforts to promote CP among industries by forming a support structure called the RECP (resource efficient cleaner production), as a strategy to encourage organizations to embrace this change and move away from the tradition end-of-pipe technologies towards CP technologies.
This study is based on a case study of a paper manufacturing company in Kwadakuza, KwaZulu-Natal. The aim of this study was to use Environmental Management Accounting (EMA) to identify benefits of CP. Paper manufacturing consumes large amounts of natural resources and generates excessive wastes. Hence, the operational activities of paper mills have a negative environmental impact. However, the scope of this study was limited to the steam generation process and focused mainly on the efficiency of the current coal-fired boilers used in the boiler plant. The research methodology used in the study was both quantitative and qualitative involving triangulation. Data was collected by means of a questionnaire, semi-structured interviews and documentary review.
The company uses old, obsolete boilers to generate steam. It had been discovered during a cleaner production assessment (CPA) of the process that the process uses large amounts of coal and generates excessive boiler ash (waste). This boiler ash also contains approximately 20 percent unburned coal present resulting in major losses to the company. Furthermore, the company has also experienced regular breakdowns during the year resulting in loss in production and high maintenance costs.
Hence, it was concluded that the steam generation process was inefficient and that the boilers were not operating as per technological specification.
However, management was unaware of the huge losses incurred due to raw material losses, more especially the coal used in the process. Environmental costs were also inaccurately calculated and thus underestimated. Hence, the ‘true environmental’ costs were not considered during strategic decision making.
Over the last two decades, EMA has emerged as an important approach by organizations wanting to improve their environmental and economic performances. However, despite the many pilot projects conducted that demonstrated the positive impact that EMA has on an organization, EMA implementation remains slow and lagging in South Africa. EMA is an environmental management tool that traces environmental costs directly to the processes and products that are responsible for those costs, thereby highlighting problem areas that need to be prioritized when considering the adoption of CP. The literature review on the role and impact of implementing EMA and the benefits of adopting CP was presented to determine and outline views and findings of past researchers. Previous researchers identified that traditional costing systems did not adequately account for the actual environmental costs incurred by companies as much of these costs were hidden under overhead accounts. Hence, production costs were high, resulting in incorrect profit margins being set and ultimately impacting on company profitability. The main cause of this was that non-product output costs were added to production cost instead of being separately recorded as ‘non-product’ output. These costs are actually environmental costs as they represent waste.
Material Flow Cost Accounting (MFCA), a tool of EMA, was considered as an appropriate method to implement to accurately calculate non-product output costs. MFCA made managers aware of the true magnitude of their losses and inefficiencies of current technology by increasing the transparency of non-product output costs (environmental costs).
MFCA was further used to benchmark non-product output costs against technological standards and best available technological standards to highlight the economic and environmental benefits of adopting CP techniques and technologies.
Based on the findings, one recommendation is that the company should consider restructuring their conventional costing system and adopt an EMA system instead. The use of an MFCA model had been suggested. This model was used by the Economy, Trade and Tourism industry in Japan to identify non-product output and improve efficiency of production processes. In addition, findings revealed that the company should implement CP techniques in the short-term to ensure that boilers are functioning according to technological specification. This will result in economic and environmental benefits for the company. However, greater savings potential is available in the long-term, by changing current technology and adopting state-of-the-art technologies. This would, however, require greater investment needs of the company to taken into consideration during strategic decision making.
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Possible tax treatments of the transfer of accounting provisions during the sale of a business and subsequent tax considerationsKroukamp, Susan 12 1900 (has links)
Thesis (MAcc (Accountancy))--University of Stellenbosch, 2006. / The potential buyer of a business evaluates the attractiveness of the transaction by
considering the financial status of the business being sold. In determining the
financial status of a business it is more important to determine the nature of the assets
and liabilities recorded on the balance sheet rather than the mere existence thereof.
Included in the liabilities are accounting provisions recorded in terms of the Generally
Accepted Accounting Practice (GAAP) to reflect a fair representation of the financial
status. Although these provisions are made for accounting purposes, they cannot
necessarily be deducted under the terms of the Income Tax Act, no 58 of 1962. The
tax deductibility of accounting provisions has long been a potential contention when a
business is sold.
The Income Tax Act has specific sections that must be applied in determining the
deductibility of accounting provisions, for example, section 11(a), which is the general
deduction formula; section 23(g), which prohibits expenses not laid out for the
purposes of trade; and section 23(e), which does not allow a deduction when a
reserve fund is created (for example a leave pay provision).
In conducting this study, seven types of accounting provision generally recorded by
businesses were identified: the bonus provision, leave pay provision, warranty
provision, settlement discount and incentive-rebate provision, post employment
provision, retrenchment cost provision and other provisions. These provisions are
discussed in view of their possible income tax deductibility, and relevant case studies
were identified to confirm the possible deductibility of these accounting provisions.
In this study, the transfer of accounting provisions during the sale of a business is
considered for the purposes of both the buyer and seller. The tax implications for the
buyer and seller are then evaluated, as well as the subsequent treatment of the accounting provisions for the purposes of the buyer. Because the wording of the
purchase contract is extremely important when a business is acquired, three examples
of the wording of a purchase contract are discussed as well as the income tax
implications thereof.
The extent of the advice given by a tax practitioner will depend on the allegiance of the
practitioner (either for the buyer or seller) and will determine how the contract will be
concluded. In conclusion a tax practitioner would want to assist his client to obtain the
most effective tax position for the transaction and therefore each purchase contract
must be reviewed on its own set of facts.
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A MOT-based cost management competency index: formulation and testing of association with financial performanceLochner, Frederick Christoffel 11 1900 (has links)
This study examined the nature and extent of relations between Management of Technology [MOT] and cost management. It explores the roles of competencies and competency measurement in these relations and its associations with company performance. The problem statement asks how the MOT community deals with cost management, whether MOT-based cost management competencies can be isolated and measured, whether a tool for measurement can be created, tested and validated and indeed whether it can be used to assess relations between MOT-based cost management competencies and company performance.
To answer these questions, a MOT-based cost management competency index is formulated, consisting of problem statements representing MOT-based cost management insights, knowledge and practices. Designed in the format of a typical research survey, the index is used to source data from sampled companies listed on the Johannesburg Stock Exchange [JSE]. Although too small a sample to generalise about the population, sufficient data is collected and processed with statistical software programs. A second set of variables, about financial performance of the responding companies, consists of Asset Turnover [ATO] and Return on Assets Managed [ROAM]. Data for these variables is sourced from their annual financial statements and processed into ATO and ROAM indicators.
The combined research data set is used to critically describe statistical qualities of variables such as ATO, ROAM, MOT-based cost management competencies of company executives, their education and exposure to the executive management teams in their respective organizations. The research data is subsequently subjected to correlation analysis, as foundation for hypothesis testing. Among the relationships described by correlation analysis and warranting further examination with regression analysis, are associations between MOT-based cost management competencies and ATO and between Education and MOT-based cost management competencies. The former association is found to be not significant, having the research hypothesis rejected. A significant association between Education and MOT-based cost management competencies is indeed found. Utilizing regression equations yielded by the analyses, the predictive capacity of regression analysis is used to demonstrate results of interventions in those associations postulated in the research hypotheses.
The study concludes that it achieved a qualified success in its first objective, which was to formulate a MOT-based cost management competency index, and to demonstrate its application as measurement and management tool on executive managers of JSE-listed companies. The study failed in its second objective, which was to demonstrate a significant association between MOT-based cost management competencies and financial performance of sampled companies. Critical perspectives on the data and the associations tested reveal important shortcomings in the research. These perspectives do though create opportunities for refinement of the MOT-based cost management competency index as measurement and management tool, validation of its status, and indeed demonstration of its business value to the MOT and business community in particular. In closure, the study was meant as a contribution to the discourse on a credo for MOT and the MOT body of knowledge, and it subjects itself to critical analysis by the research community so as to establish whether it succeeded in indeed making such a contribution. / Business Management / M.Tech. (Business Administration)
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Measuring the successful implementation of Activity Based Costing (ABC) in the South African post officeTaba, Lucas Makomane 30 September 2005 (has links)
Measuring the success of Activity Based Costing (ABC) is part of a more general challenge of measuring the success of any major change in managerial methods. The past thirteen years have seen accelerated rates of change in the South African Post Office (SAPO). However little is known about `'Measuring the successful implementation of ABC in (SAPO)''.
The objectives of this study is to research the perceptions of staff regarding the successful implementation of ABC, the benefits of ABC implementation and the conditions that affect the potential benefits from the successful implementation of ABC. This will allow organisations and provide them with relevant information that will enable them to make better decisions with regard to measuring the successful implementation of ABC.
To achieve these objectives a questionnaire was prepared and handed out to the finance staff of the SAPO. They were asked to respond to the questionnaire on their experience and their perceptions on the implementation of ABC. 121 questionnaire were returned generating a 38% response rate.
The findings in this study highlighted that top management fails in giving active support to the implementation of ABC and the technical factors were perceived as standing in the way of the successful implementation of ABC. These were training, the high cost of implementing ABC, the lack of software packages, the lack of data requirements and co-operation between departments.
From the finding the recommendation was made were general strategies were suggested for the SAPO for measuring the successful implementation of ABC. / Business Management / M.Tech. (Business Administration)
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An adjusted material flow cost accounting framework for process waste-reduction decisions in the South African Brewery industryFakoya, Michael Bamidele 03 1900 (has links)
While contemporary environmental problems arise partly from increased industrial activities resulting in waste creation, the continued extraction and depletion of earth’s natural resources by organisations to meet consumers’ demand have led to unsustainable business practices (Jennings & Zandbergen 1995). Moreover, reversing the negative environmental impact caused by unsustainable business practices is the responsibility of the organisations whose activities cause harm to the environment (Ahuja & Khamba 2008). More importantly, managers require adequate and accurate financial and non-financial information on their unsustainable business practices to successfully manage both internal and external environmental effects of their actions (Schaltegger & Burritt 2000). But the lack of contemporary management accounting tools to capture waste information in the brewery process reduces the chance to improve waste-reduction decisions while opportunities for cost savings are also lost. Admittedly, Gale (2006:1231) argues that conventional management accounting Systems (MASs) do not have the ability to adequately monitor the increasing material costs and overheads in production processes with sufficient transparency. Nevertheless, this inability to provide adequate process waste information may likely limit organisations’ effort to implement and achieve desired waste-reduction strategies. As a result, it is imperative to integrate both physical and monetary waste information for sound decision-making.
The main objective of this study is to adopt and adjust the existing MFCA framework to support and improve on managers’ process waste-reduction decisions in the South African brewery industry. In order to achieve this main objective, the study:
• examines the extent to which conventional MASs provides process waste information to support waste-reduction decisions in a micro-brewery (Hope Brewery) and a large brewery (SAB Ltd);
• assesses the impact of insufficient process waste information as provided by the conventional MASs on brewery waste-reduction decisions in a micro-brewery (Hope Brewery) and a large brewery (SAB Ltd); and
• adjusts the existing MFCA framework to include waste categories subsumed or neglected in the provision of waste information to improve brewery waste-reduction decisions.
vi
The study adopted an exploratory multiple case study approach by means of in-depth interviews and a pilot study in two breweries- a micro-brewery and a large brewery to achieve the study objectives.
Findings revealed that, while the use of technology is essential to reduce brewery process waste, there is lack of appropriate waste-capturing management accounting tool in both organisations. Besides it is essential for organisations to adopt appropriate management accounting tool to capture waste-related information for improved waste-reduction decisions and selection of appropriate waste management strategy. The study therefore suggests the adoption of an adjusted MFCA framework for a more robust approach to improve waste-reduction decisions since ‘what cannot be measured cannot be managed’. / Management Accounting / D. Comm. (Management Accounting)
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“Watch-dogs for an Economy” : a determination of the origins of the South African Public Accountants' and Auditors' Board – as the Regulator of the Profession – principally through an analysis of the debates and related reports to the House of Assembly of the Parliament of the Union of South Africa in the period 1913–1940Lancaster, Jonathan Charles Swinburne January 2014 (has links)
This thesis concentrates upon a new field of research in South African accounting scholarship – this being, in general terms, accounting history and more specifically an analysis of the origins of the Public Accountants’ and Auditors’ Board as watch-dog in relation to: ● the South African economy in the period 1913–1940; and ● the changing political framework (also in the period 1913–1940). The integration of economy, politics and personal ambition on the part of early 20th Century accounting societies, led to a variety of responses, counter proposals, stalemates and unfocused activity which caused the process of accountants’ registration to extend over 38 years in South Africa. This confusion was in strong contrast to the process of speedy registration of accountants in New Zealand and Australia. The final unification of South African accounting societies in 1951 created the Public Accountants’ and Auditors’ Board. Its creation, at long last, suggested an overarching control and regulation which was mirrored in the final political unification and economic stability of a South Africa dominated by Afrikaner Nationalists. One further element was interwoven into the fabric of the thesis – this being the application of institutional economic theory and its impact upon the accounting concepts of “material irregularity” and “reportable irregularity”.
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Using material flow cost accounting to determine the impacts of packaging waste costs in alcoholic beverage production in an alcoholic beverage company in DurbanTajelawi, Omolola Ayobamidele January 2016 (has links)
Submitted in fulfillment of the requirements of the Master of Accounting degree, Faculty of Accounting and Informatics, Durban University of Technology, Durban, South Africa. Durban. South Africa, 2016. / A large number of manufacturing companies adopt the use of the traditional accounting method in their operations. This technique fails to reflect a detailed report of all material losses incurred in their production processes. Worthy of note, is that losses/waste are considered as inefficiencies in manufacturing operations and viewed as a costly venture to the sustainability of the company.
This research, therefore, through a case study analysis, examined the efficient/inefficient flow of resources in the production process of an alcoholic beverage company in the Durban metropolis. The study was carried out in order to determine the impact of packaging waste cost in an alcoholic beverage company using the material flow cost accounting technique. Measurements included the input of packaging materials against its output, while giving consideration to waste incurred as losses.
The Material Flow Cost Accounting (MFCA) technique, an environmental management accounting tool developed for measuring the flows and stocks of materials of a company and production process in both physical and monetary units, was used to measure the costs of waste on two production lines. MFCA was used to trace all material inputs and categorize them as product or non-product output. MFCA is used to classify the relevant material flows as cost collectors, thereby allocating the costs of the company’s production operations and flows.
Different packaging materials that constitute waste on the lines were analyzed using the mixed method approach, which includes observation, questionnaire administration, and analysis of six months production report. Two production lines were considered for sampling, and recommendations were given based on the data analyzed using the SPSS package.
The MFCA technique revealed that losses on both production lines were understated, and that, the bottling plant was losing a sizeable amount of monetary value of packaging materials to waste. The MFCA technique also revealed that the traditional costing technique is unable to provide adequate information managers require for strategic cost decision making.
MFCA is therefore recommended to assist managers improve production line efficiency and cost savings via accurate waste costing and reduction for corporate sustainability. / M
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Adopting a cost accounting model to facilitate decision making in African complementary and alternative medicine practice in South AfricaTaba, Makomane Lucas January 2021 (has links)
Thesis (Ph.D. (Commerce)) -- University of Limpopo, 2021 / This research aimed to develop a costing model for the African Complementary and Alternative Medicines (ACAM) health practitioners to improve their products and services’ decision-making process. This research aim drew support from fundamental objectives, which includes amongst others, the identification of the current product and service costing approaches used by the ACAM practitioners and how this supports their decision-making, the development, and adoption of a costing model for ACAM practitioners to capture products and services’ cost information for improved health care service delivery. Furthermore, it sought to understand the challenges faced by ACAM practitioners in adopting the proposed costing model.
The research applied a qualitative action research method. Data collection was through interview method from twenty-six ACAM health practitioners in six ACAM health care facilities. Data were collected after two research cycles in the field study through action research procedures. The participants were drawn from five South African provinces. The main data was gathered through face-to-face semi-structured interviews, documentation, and direct observation to enhance the research validity and reliability. The data were analysed systematically using thematic analysis
The findings reveal that the study succeeded in providing more accurate cost data for each product and assist in the planning, control and decision making for the ACAM practitioners. The research contributes academically and to practice by successfully narrowing the gap between ACAM researchers and cost accounting researchers by providing a practical costing model based on solid practical and academic foundation. The researcher recommends that the South African ACAM facilities need to adopt and implement the ACAM costing model because it will provide them with more accurate cost data for the provision of each service and products and help in making effective and reliable decisions.
Key words:
Cost accounting practice, ACAM health facilities. ACAM health practitioners, ACAM Colonisation, ACAM Healing, Contingency Theory, Production Theory, Cost Elements, Costs Classification. ACAM Production Process
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Corporate disclosure quality - a comparative study of Botswana and South AfricaKiyanga, Bendriba Patrick Lutimbanya 07 1900 (has links)
Corporate reporting has changed from the traditional form of reporting which covered financial information only to the modern form of reporting called integrated reporting which covers, financial, corporate governance and sustainability information. The levels of corporate disclosure among corporate entities within any country and between countries are thus likely to have been affected by this change.
Motivated by the IMF/World Bank (2006) that observed that corporate reporting improved in Botswana during the previous five years, without indicating what the actual level was or how it compares with that of other countries; this study sought to determine the actual level of corporate disclosure of two samples of companies: 23 companies listed on the Botswana Stock Exchange (BSE) and the top 40 companies (by market capitalisation) that are listed on the Johannesburg Stock Exchange (JSE). The study also shows how the two levels of corporate disclosure compare.
This study is qualitative and descriptive by design; and involves analysing the content of the corporate annual report of each company in a sample using a corporate disclosure checklist; and determining the level of corporate disclosure for each sample of companies. The process ends with a comparative analysis of the levels of corporate disclosure of the companies from the two samples.
Consistent with the IMF/World Bank report, the study revealed that the level of corporate disclosure in the BSE sample was low but increasing. However, the increase in the level of corporate disclosure varied from sector to sector and the specific information items. The study also showed that integrated reporting was not practised at all by the companies in the BSE sample.
Comparatively, companies in the JSE sample had a higher level of corporate disclosure than that of companies in the BSE sample; and the rate of increase was much higher than that in the BSE sample. The study further found integrated reporting practiced in the entire JSE sample, although at different levels.
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This study also noted that although in principle it is sensible to benchmark from the best, other fundamental factors need to be considered before carrying out the exercise. Furthermore, the study indicated that the prevalent low level of corporate disclosure in the BSE sample was evidence that the corporate reporting environment in which the BSE lies was not conducive for the theories of corporate disclosure to fully explain corporate disclosure.
A number of recommendations were made including establishing corporate disclosure indices and creation of a corporate environment in which all the theories discussed in the study can explain corporate disclosure.
This study contributes to the literature on cross-country corporate disclosure and cautions companies with low levels of corporate disclosure not to embark on benchmarking without creating an environment conducive for corporate reporting. The study also offers useful insights to policymakers in Botswana and South Africa; and stimulates further research on cross-country corporate disclosure. The academia too will be able to identify areas for further research from this study. / Business Management / M. Com. (Accounting)
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