Identifying and Managing Control System †MyAssignmenthelp.com

Question: Discuss about the Identifying and Managing Control System. Answer: Introduction The following reported study contains a business case for Bakers World, a small bakery business in Townsville, Australia. The local business of the bakery involves three retail stores in the target market. Meanwhile, the business was set up a couple of years ago with a single outlet. Currently, increased demand due to the quality of products has forced the business to improve the accounting system so that the financial process will be maintained and restructured accordingly (Schaltegger, Bennett Burritt, 2016). In order to maximise the full capacity of the production units and meet the seasonal demand of bakery items, the business case will suggest the introduction of the most valid option. Moreover, the project plan elaborates critical assumptions and constraints to be considered (Cain, 2011). In addition, the valid options must be evaluated to identify the preliminary requirements of the project. Lastly, the study report identifies the budget estimates, financial analysis, project schedule, and risks associated with the project plan. The fundamental aim of the business case is to implement a change in accounting system so that manual system can be replaced to accomplish the potential financial objectives. By introducing a change, the current business structure will be benefitted. Also, by implementing a change in the accounting system, Bakers World can utilise the full financial capacity to expand their business set up in the target market. Evidently, the proposed change in the accounting system can ensure the long-term business viability of Bakers World (Harrison Horngren, 2014). To set up the change, the estimated budget allowance is $30,000. Effectively, the entire change process in the business has been expected to complete within 120 days. Systematically, the business case also predicts the benefits from the change operations on the business in the upcoming future. In the current business scenario, the growth in revenue and profitability of Bakers World has created challenges in managing the accounting system in a manual way. Due to the manual system, the billing of products has been a time-consuming process (Rupert Kern, 2015). Also, the lack of inventory management has created a number of issues in the production units limiting the capacity of production. Hence, the introduction of latest accounting system can release the excess pressure to maintain financial objectives manually (Nandhakumar Jones, 2011). Also, the participation of the new system will help to increase consumer service as billing process can be a lot easier and error free. By initiating the online based accounting system, the strategic plan of the business will be improved. In the recent time, the management has faced a number of issues in managing the accounting system in a traditional way. By implementing the online system, invoicing of the products will become considerably easier. Therefore, customer service will be boosted. On the other hand, the introduction of the online accounting system can link the entire accounts of the three outlets so that management of inventory, costs, and sales report etc. will be done in an effective and error free manner (Levin, 2008). The makeover of the system will definitely contribute towards the long-term business growth for the bakery business. Critical Assumption and Constraints The critical assumptions and constraints associated with the business project plan have been described as follows: All the financial forecast developed for the makeover of accounting system is based on assumptions (Broadbent, 2011). It is assumed that the entire budget of the project will be around $30,000. It is assumed that the entire project will be developed within 120 days. Predictably, the return on investment will be reflected after 12 months of initiating the project. In the meanwhile, the facilities provided to the existing employees will be utilised during the ongoing project. In terms of increasing the potentials of the production units as well as the inventory system, the management must identify the existing issues with the traditional accounting system. During the implementation of the online-based accounting software, all the previous data and resources must be transferred to the electronic system at the beginning. Also, the cost of shifting the system from traditional to online must validate the financial returns and benefits in the long-term (Broadbent, 2011). At the time of implementing the new system, training of staff members can be identified as a vital factor as well to maintain balance at work (Barsky, Catanach Kozlowski, 2013). However, the management will be recommended to continue both the traditional and online-based accounting system for some time. Clearly, it should be an alternative option to continue the business proceedings while introducing the system change. Also, the project management team must strictly follow the estimated budge t resource in the organisational consolidation process. The business case report should be verified by the project manager on the weekly basis to identify the actual process of change. It is the obligation of the project manager to submit a report at the end of the each week to the management of Bakers World informing the summary of progress. Evidently, the weekly report must represent the actual cost as well as the estimated budget for the task completed (McNamara, Baxter Chua, 2014). In addition, the weekly report should summarise the challenges that must be dealt in the next week. Also, the report must identify any unscheduled pending work that has not been considered during the initial project plan. Precisely, the preliminary project requirement is to determine the key performance indicators (KPIs) so that the project leader can measure the success of the change implemented according to the set targets (Turner Weickgenannt, 2013). Budget Estimate and Financial Analysis The budget estimates and financial analysis of the online accounting software project for Bakers World have been presented herein below: The budget has been prepared on the basis of the historical data and best estimations made through market research (Unnikrishnan, 2012). It is expected that the project will cost around $30,000 for implementing the new online accounting system. As the financial projection is based on assumptions, a variance of no more than 10 percent is estimated for the project. The primary cost elements of the project include inputs, labours and training cost for the employees (Levin, 2008). The costs associated with the new online accounting system project are to be undertaken within the 2017 Bakers Worlds operating budget. The budget only presents the major expenditures without forecasting the financial returns in amount. However, the financial return has been presented in terms of sales growth percentage that is assumed to be achieved by the company in the upcoming three years. Please refer to Appendix 1 for the forecasted project cost. The project is forecasted to start on 1st November 2017 and the duration of the project is estimated to be around 120 days. Hence, the project will be completed by the 28th February 2018. The number of days required to complete each activity and the schedule of the tasks have been presented in the table given below: The identified risks that are expected to impact the project are presented herein below: Financial Risk: The expenditure above the estimated amount may lead to budget failure. Additionally, the changes in the external market factors may lead to overestimation of the return on investment (Stokes, 2011). Security Risk: The online accounting system is vulnerable to security threat such as loss of data and hacking by third party (Sheehan, 2016). Restriction from the Employees: Old employees who do not have technical skills may feel disappointed by the change that may lead to employee turnover (Schaltegger, Bennett Burritt, 2016). Standardisation of the project: The project may fail to achieve the desired objectives due to poor quality and improper input of data (Schaltegger, Bennett Burritt, 2016). Conclusion By considering the above business case on online accounting software for Bakers World, the new project will improve the efficiency and effectiveness of the employees. Furthermore, it will save time of the consumers that will enhance the customer satisfaction level. Additionally, the new accounting system will provide easy access of revenue and expenditure data of the two outlets to the head office without making any physical effort. Hence, the project is essential for the Bakers World to improve their service in terms of inventory management, accounts management and customer support. Conclusively, the cost incurred for the project can be earned back within a year with proper implementation of the new online accounting system. References Barsky, N., Catanach, A., Kozlowski, B. (2013). Creating Strategic Responses to Critical Risks Facing Accounting Education.Issues In Accounting Education,18(4), 445-462. Broadbent, J. (2011). 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