Role of CA

8/12/2019 Role of CA

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Role of Chartered Accountants in

Building Successful Organizations

Presentation by:

Ahmad Saleem

Performance Management Consultant

0300 8471640

[email protected]


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Objective of this Seminar

To discuss role of Chartered Accountants in extended form

My own Experience as Employee & as Consultant

significantly better what they are presently performing

Presently they are doing their JOB in perfect way but additional working

can bring major change

Basic Objective of this seminar is to share and discuss our experiences

and knowledge in this regard
mailto:[email protected]


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Roles of Chartered Accountants

Head of Accounts & Finance

Any position in Accounts Department

Internal Auditor

External Auditor

Management Consultant

Any other position


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Why in this Position

Observing all Activities

Every Activity has Financial Impact

During Audit Learned all the

Areas

Cannot improve Quality


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Special Traits of Chartered Accountant

System based

Monitoring Risk

Chartered Accountants have special traits, which are developed due to their

special nature of training

Completeness

Compliance Testing

Analytical

Planning

Consideration of Financial Value

Monitoring

Auditing Nature

Substantive Checking


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Traits for Building Successful Organization

Visionary

Take Ownership

Traits

Complete Business Picture

Leadership

Success

Take Responsibility


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Main Areas

Planning

Systems

Budgeting

Costing

Risks & Controls

Monitoring

Performance Monitoring


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Objectives of the Organizations

Objectives based on basic thought

Different Objectives for different Org .

Based on available resources and opportunities

Working towards achieving their Objectives


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Success

What is Success?

Sustainability

Achieving

YourObjectives

Financial Stability

Expansion

Smooth Operations

No Surprises

What areObjectives?

Controlled Working


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Are Chartered Accountants Responsible?

Whats your opinion? Need Discussion

In my opinion


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Then Why Someone will do this?

Success Comes by taking

Responsibility

Ownership

In most of the cases, the

Chartered Accountants

are not directly

responsible

But they are in

position to guidethe others for

making Organization

successful

They are in best

position to adviseManagement

regarding different

options.


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Main Areas

Organizational Level

Departmenta Leve

Activity/Transactional

Level


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Or anizationalLevel


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Organizational Level

Planning

Goals and Targets

Benchmarking

Budgeting

Organizational Behavior

Systems and Procedures

Financial Planning

Fixed Assets Management

Costing

Risks & Controls

Knowledge Management

Role of MIS


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Planning

Planning

Strategic

Planning

Business Plan


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Planning

Strategic

Planning

Business

Plan

Long Term

Based on Resources

Cannot be changed EASILY

Short Term planning based on this

By Top Management

For Short Period

Based on Resources

Can make Changes easily

Operations based on this

By Senior and Middle Management


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Goals and Targets

Based on the Business Plan, Goals and targets will be determined

Monitoring of Goals and Targets

Verification of Actual Achievements

Linking and reconciliations of Results

Keeping on track

all the departments

Sales, Production, Purchases, Utilization of Resources


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Keeping complete control on the finances of the Organization

Keep financial burden minimum

Financial Planning

Establish accurate financial requirement

Look for high stocks and receivables

Avail maximum benefit from Suppliers and Creditors

Never go for Capital Investment from Working Capital Facilities

Accurate projected Fund Flow Statement involving all departments

and making them responsible


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Fixed Assets

In most of the cases, Fixed Assets is the major part of the investment, watch it..

Complete record of Fixed Assets

erent ate etween ro uct ve an upport ve ssets

Calculate return on Assets with Sales and Contribution Margin

Record of Insurance and Warranties

Repair & Maintenance

Preventive Maintenance

Disposal of Assets

Assets Condition


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Costing, Contribution Margin

and BreakevenCost incurred when a resource is utilized. Keep complete

record of Cost, Contribution Margin and Breakeven Analysis

Complete record of cost including direct and indirect cost, fixed cost etc.

Computation of Contribution Margin, linking with Sales and Profit

Product wise Contribution Margin

Compare return with relation to investment, time consumption etc.

Breakeven analysis, simple and based on cash return


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Budgeting is a process of making best estimate regarding a

future activity and then following the initial estimate.

Budgeting

Production Budgets Time Budgets

Breakdown Budgets

Energy Budgets

Wastage Budgets

Financial Budgets


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Organizational Behavior is the personality of the

Organization Cannot do much however following is

possibility

Organizational Behavior

e ega on

Authority

Result Oriented instead of ..

espons y anagemen

Ownership

System based

Training and Guidance


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Systems, Policies and Procedures

Performing any activity in a similar way all the time and all users have same

understanding is called system. This also include processes, policies &

procedure.

Ensure system for every activity

Policies should be available for all scenarios

Standard Operating Procedures SOPs

Should be demanded


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Systems, Policies and Procedures

System for Material Issuance

D scount to ustomers

Advance against Salary

Traveling policy

Material receiving


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Risks and Controls

With every activity there are risks Inherent, intentional, un-intentional etc.

For Prevention of risks, there are certain Controls

Authorization

Documentation

Physical Checking

Access Controls

Reporting

Budgets


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Organizations need to have full information and knowledge regarding all related

activities.

Knowledge Management

Data

Documents and Forms

Reports

Information

Knowledge


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Production

Marketing

Knowledge Management - Discussion

Sales

Fixed Assets

Operations

Purchasing


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Software can play vital role in Organizational Success this may include every

possibility of Automation

What can be controlled?

Role of Software

Basic system is a MUST requirement

Objectives and Benefits

Implementation


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Role of Software

Usage Benefits

Processing through Software

Magnetic Cards, Bar Codes etc.

Sensors, timers etc.

Programmable Logic Controllers

Accuracy

Consistency

Speed

Control


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DepartmentalLevel


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Departments

Marketing

Sales

Production

Quality

Administration

Human Resource

Planning

Purchasing

Stores

Internal Audit

MIS

Accounts


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What to observe?

Departmental Working

Departmental Costing

Activity based Costing

Results How Effective

Wastage of Resources

Information & Knowledge

Effectiveness

Objectives

Cost benefit Analysis

As Profit Center

In most of the cases, Chartered Accountants feel that these areas are

out of their Jurisdiction we need Discussion


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Marketing

Marketing is a process where product awareness

is built and established

Link Marketing with Sales

Check Relevance

Check with actual activities

Marketing Plan with expected results


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Production is a process of manufacturing and preparing

goods for Sales and Operations are the activities where

production process is not involved.

Know the production process

Production / Operations

Production Capacity

Establish Benchmark Convert in financial term

Wastage and efficiency

Production Accounts

Compare actual with budgeted with reasons


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Relates with all planning matters of Production and

Operations

Planned as per Capacity

Production Planning

Optimum utilization

Adjustment of different orders

Coordination with Sales and Production

Losses due to lack of planning

Non utilization of capacity and reasons


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All matters relating to management of materials

Control on receipt Gate Control

Material Management

Stacking

Old Items reasoning

Issuance / Consumption

Damage / Expiry Dates

Physical Checking and Record Keeping


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Checking quality of goods produced with desired Quality Level

Why Chartered Accountant is responsible?

Quality Control

Incurring a cost and results should be there

Claims due to Quality charged to deptt

Department should certify

Mention and note all the known problems


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Administration provides support services relating to

communication, transportation, utilities, entertainment,

traveling and general office supplies and arrangement.

Administration

Not suppose to s gn w t out ver cat on

Establish justification

Mess charges, conveyance, overtime, utilities


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All matters relating to Human resource establishing

requirement, JDs, hiring, retention etc..

Department budget for HR

Human Resource

Policies must be clear and available

Record must be complete

Roles of departments known to everyone


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Related with all hardware and software matters and

activities

In best position to coordinate with IT

MIS / IT

Verify results

Suggest system improvements

Decision Support System


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Responsible to keep accounting record of all transaction

of the Organization related activities. Includes normally

Finance, Costing, Taxation, Budgeting and Corporate

requirements

Responsible for complete book keeping

Accounts

Required to check in depth all transactions

Can question any transaction

Use Reconciliation and ratios

Check unusual activities

Need to extract Information and Knowledge


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Transactional Level

Justification

Authorization

Relevance

Budgeted

Purpose

Information & Knowledge

Support Record

Documentation

Physical

Systems and Rules


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Analysis

Reports and Analysis

a os

Reconciliation


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Case StudiesMarketing Marketing department spent Rs. 10 million on advertisingcampaign, in which heavy advertisement was made. What questions and

parameters can be checked by the Chartered Accountant?

Large Sale contracts have been signed by the Sales Department and Top

be raised by a Chartered Accountant in these contracts?

Sizing Beams, which are used in Weaving Industry need to be polished

after certain period of time? You have received bill of Rs 400,000 for theirpolishing? What sort of questions can be raised and asked?


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Case StudiesQuality Control Your Company is dealing with the customers who arenot quality conscious, however your management is too caring for quality

matters. You will have to discuss this matter with Top Management, what

should be the concerns which should be discussed.

Company received an excellent low priced deal on main raw material. The,

is uncertainty that material may not be used in near future. What should

be your role in this case?

Manufacturing department is showing excellent result, however they

themselves prepare all the results and no one is checking their results,however management is very impressed with the high efficiency of

Production. What sort of concerns can be checked by you?

Role of CA

Documents

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