CERTIFIED MANAGEMENT ACCOUNTING

INTENSIVE CMA PROGRAM August 2023

Strategic Cost Management

Day One: Saturday August 5, 2023

8am: Introduction and Inauguration

8.30am: Topic 1: Management Control Systems

The role of accounting is often stated to be providing information for decisions.
Management accounting, however, fulfils a much broader role in organisations. As well
as providing a framework for planning, management accounting has an important role
in management control. This topic will introduce the concept of management control
and consider the role of management accounting in management control together with
some issues in the design of management accounting systems, the types of control, and
how the various levers of control can be integrated.

10.30am- 10.45am: Tea/Coffee Break

10.45am: Topic 2: Lean Manufacturing & Quality Control

This topic introduces the traditional manufacturing management techniques and
strategies. The 5-P’s of manufacturing are specifically considered; i.e. the product,
plant, process, program, and people. The three traditional types of manufacturing; i.e.
Job; Batch; and Flow production are also studied, and concepts such as quality and
reliability are also introduced. The Lean Manufacturing techniques originating from
Japan, such as Flexible Manufacturing Systems (FMS); and Total Quality Management
(TQM) are also considered. It is shown that concepts and techniques used in
manufacturing can also be used in service industries. The technologies that are
disrupting today’s manufacturing and service environments and the technology trends
that will change the way organisations create and deliver a product or service in the
near future are also discussed.

11.30am to 12:30pm: Simulation Game

12:30pm to 1pm Learning from the game and balance of Topic w

1pm to 1:45: Lunch Break

1:45pm: Mini-Case Study on Accounting for Quality: Clean Shaven

2:15 pm: Topic 3: Cost Accounting and Cost Management in a Lean Environment This
topic continues to look at production management techniques and strategies, especially
the Leaner production philosophies originating from Japan, such as JustIn-Time
production (JIT). The strategic management accounting issues raised by such
philosophies and techniques and aspects of the influence of the philosophy on
production and purchasing are also covered. ‘Backflush Costing Systems’ are introduced
in this topic, as an alternative to job-order and process costing systems.

3.15pm -3.45pm: Mini-Case on Accounting in a JIT Environment: Silicon Valley

Computer

3:45: Tea/Coffee Break

4pm: Topic 4: Life Cycle Costing Systems

This topic overviews the complexity that exists in modern industrial settings, and why
the conventional management accounting techniques may provide misleading
information in such environments. It is shown that indirect costs make up the largest
percentage of total costs in such complex firms, and that there are many challenges in
allocating such indirect costs. Methods of identifying ‘obsolete’ cost systems and of
improving cost control are also discussed. Whole of Life Costing, i.e. costing before,
during and after manufacturing or service delivery is considered within a complex and
competitive industrial setting. A part of Life Cycle Costing, called Target Costing, i.e. the
techniques of controlling pre-production design costs, is considered in detail.

5.30pm: End of Day One

Day Two: Sunday August 6, 2023

8.30am: Case Study on Target Costing: Phraud Car parts Company case Study –
Discussion

8:45am Topic 5: Benchmarking

This topic discusses in depth ‘Benchmarking’ which is the formal process of measuring
and comparing a company’s operations, products and services against those of top
performers, both within and outside that company’s primary industry. Benchmarking
approaches such as internal, competitive, functional and generic are specifically
considered, as are measures used to evaluate performance.

10.00am- 10.10am: Tea/Coffee Break

10.10am: Topic 6: Activity Based Cost Allocation Systems
This topic focuses on the principles of Activity Based Costing (ABC), which is shown as
the response to the challenge of complexity. Aspects such as “volume”, “structural” and
“introductory” costs are specifically considered. The differences between manufactured
products and services are highlighted, and the question is asked whether such
differences warrant a separate costing system for service industries. Other approaches
to cost allocation, such as TDABC, are considered.

11.30am to 1pm: Case study on ABC: Mellow Case Study and video.

1pm Lunch Break (45 Mins)

1.45 pm: Topic 7: Customer Profitability Analysis

This topic moves the focus from analysis to action. Methods of finding profitable
customers and products are considered, as is the area of account management and
Customer Relationship Management (CRM). The topic also considers the impact of big
data analytics and social networks on the company’s CRM, and how these have evolved
into Social CRMs.

2.45pm to 3.15pm: Case Study on Customer Profitability Analysis: Bank of Kew 3:15pm:
Tea/Coffee Break

3.30pm: Topic 8: Process Control and Activity Based Management

This topic discusses the areas of process control and activity management; and shows
how cost drivers obtained for cost allocations can be used as performance measures of
process efficiency and effectiveness. Monitoring systems, and the concepts of
frequency, timeliness and accuracy are also considered, especially in relation to white-
collar departments.
5:30pm: End of Day Two

Day Three: Monday August 7, 2023

8.30am: Case Study on ABM: Dilbert Laboratories – Discussion

8:45am Topic 9: Implementing Cost Analysis and Control Systems
This topic outlines the implementation stage of activity-based cost management
systems. Behavioural aspects, especially in creating motivation are discussed. Long-
term cost management models are also considered. The topic also considers the issues
that arise when moving from ‘project’ to ‘steady state’; especially the factors that will
ensure the long-term sustainability of a re-engineered ABC system.

10.15am – 10:30am Tea/Coffee Break

10.30am: Case Study on Implementation: Oakley Paints including
12:30pm – 1:15pm: Lunch Break (30 Mins)

1.15pm: Topic 10: Strategic Performance Management Systems

This topic looks at Strategic Performance Measurement Systems, especially the linking
of financial control systems with process-based control systems. Some Key Questions to
ask in the strategic refocusing of Performance Measurement Systems are discussed, and
the recognition of frameworks such as the Balanced Scorecard in linking financial and
strategic performance measures are specifically considered.

2.30pm: Topic 11: Environmental and Social Management Accounting Part

1Environmental and Social Management Accounting [also known as Corporate Social
Responsibility (CSR) and Triple Bottom-line Accounting (TBL)] is changing the way
organisations go about their business. This topic explores what is meant by the "triple
bottom line" and what it means for organisations, now and in the future. The need for
integrated management accounting reports are discussed; and the impact of climate
change and carbon emissions trading on Cost and Management Accounting is
specifically considered.
3:15pm- 3.30pm: Tea/Coffee Break

3.30pm: Topic 11: Environmental and Social Management Accounting Part 2

4.30pm: Topic 12: Strategic Governance and the Strategic Audit

This topic first overviews the different approached to corporate governance, which
specifies the distribution of rights and responsibilities among different participants in
the corporation, such as, the board, managers, shareholders and other stakeholders,
and spells out the rules and procedures for making decisions on corporate affairs. The
development of Enterprise governance systems, incorporating both structural
governance and strategic governance are then compared and contrasted. Finally, it
considers assurance issues using ‘leading’ rather than ‘lagging’ indicators, via the
Strategic Audit.

5.30pm: End of Day Three

Strategic Business Analysis
Day Four: Tuesday August 8, 2023

8.30am: Topic 1: Strategic Thinking

This topic overviews the concepts and development of strategic planning in modern
business enterprises. The traditional areas of corporate strategy; such as strategic
objectives and strategic planning decision models are first introduced to the student.
The state of strategic thinking in the current environment is then considered, especially
in relation to multiple approaches to analysing corporate strategy. The use of Big Data in
strategic planning and thinking is specifically considered.

10.30am-10.40am: Tea/Coffee Break

10.40am: Topic 2: Strategic Marketing Analysis and Budgeting

Here the marketing concept is introduced and the links between marketing and
strategic business analysis are illustrated; and the impact of Big Data analytics in
customer-data driven marketing strategies is considered. It is shown how concepts such
as the product life cycle and product portfolio matrix are linked to managerial
accounting techniques such as budgeting and life cycle costing to provide relevant
information for strategic decision making. A comprehensive strategic segmental
marketing budget is developed in this topic.

12:30pm-1:15pm Lunch Break

1:15pm to 3:15 pm: Comprehensive Case Study on Accounting for Strategic
Marketing: The Roxor Watch Company: Case Study Analysis and Presentations

3:15pm - 3:30 pm: Tea/Coffee Break

3.30pm: Topic 3: Financial Analysis in Product Portfolio Management This topic looks at
the interface between management accounting and marketing related “product or
services management” especially in competitive environments. The “product” is the first
“P” in the 4-Ps of marketing, the others being price, promotion and place distribution,
which will be discussed in detail in later topics. It is shown that as a product/service
moves through various stages of its life cycle, there are differing financial aspects that
need to be focused on for competitive positioning. It is demonstrated that the
company’s management accountant possesses the tools and techniques required to
provide the product/service managers with decision-orientated information, especially
in financing technological innovation in the digital age.
5.30pm: End of Day Four

Day Five: Wednesday August 9, 2023

8.30am: Topic 4: Pricing Methods and Strategies

Here the various aspects of pricing decisions are covered, especially in competitive
environments. Pricing methods and pricing strategies are specifically contrasted, and
the use of such techniques as CVP analysis and linear programming in the pricing area
are discussed. Risk averse pricing strategies and their limitations are also covered in this
topic.

10:30am -10.45am: Tea Break

10:45am to 11:15am Case Study on Pricing: ePrecision Manufacturing Company incl.

Tea/Coffee Break

11.15am: Topic 5: Financial Dimensions of Pricing in International Business Strategies

This topic extends the discussion of the previous topic on pricing, and considers pricing
within a competitive international market. It is shown that setting a selling price in a
foreign market has, in addition to strategic marketing considerations, some unique
international financial dimensions, especially due to the lengthening of the channels of
distribution and the impact of multiple currencies.

1pm to 1.45pm: Lunch Break

1:45pm to 2:30pm Financial Dimensions of Pricing in International Business Strategies

(contd.)

2.30pm Topic 6: Promotion: Push Strategy and Human Resource Management

Here the principal ways of communicating with the market, referred to collectively as
the “promotional mix” are overviewed. The objective of this mix is to make a sale,
either by “pulling” customers towards the product (using advertising) or by “pushing”
the product to the customer (using personal selling). It is shown that the management
accountant has a significant role “push strategy”, especially in the human resource
management areas of controlling field sales operations and evaluating sales force
performance.
3:30pm to 3:45pm - Tea/Coffee Break

3:45pm: Case Study on Sales Force Analysis: Supersonic Stereo

5.30pm: End of Day Five

Day Six: Thursday August 10, 2023

8.30am: Topic 7: Promotion: Pull Strategy and Integrated Marketing

Communication
This topic continues with the discussion on promotion, and specifically looks at “pull
strategy” and integrated marketing communication (IMC) with its heavy reliance on
advertising; especially via digital marketing platforms. It is demonstrated that the
management accountant has a significant role in formulating advertising budgets,
especially using specific budget models, and in the difficult areas of controlling
advertising outlays and evaluating advertising effectiveness.

10:15am – 10:30am Tea Break

10:30am to 1pm: Comprehensive Case Study on Accounting for Promotions: Suave

Case Study Analysis and Presentations

1pm-1:45pm: Lunch Break

1:45 pm: Topic 8: Supply Chain Management and the Place-Distribution Decision This
topic considers the last “P” of the 4-P’s of marketing; i.e. place (or physical distribution).
It is shown that the control of the supply-chain distribution function involves a “trade-
off” between maximising customer service and minimising distribution costs, and that
the management accountant has a significant role to play in achieving this balance. The
tools and techniques of distribution cost analysis and control that are used in providing
customers value and maintaining efficient cost management in the digital world are
highlighted in this topic.

3:30pm -3.45pm: Tea/Coffee Break

3.45pm: Topic 9: Performance Valuation and Strategic Financial Structures This topic
introduces Business Performance Measures and provides a link as to how these
measures are interrelated with the capital structure of the firm. The impact of financial
structure on planning performance evaluation is considered, specifically the relative
measures (ratios) used in financial statement analysis. Investment and Financing issues
are separated; and capital structure and its role in obtaining an appropriate discount
rate for capital projects is particularly considered. The topic also covers the more recent
approaches to project and corporate funding such as venture capital and crowdfunding.

5.30pm: End of Day Six

Day Seven: Friday August 11, 2023

8am: Topic 10: Strategic Value Analysis

This topic overview the different approaches to ‘value investing’; and introduces the
concept of Strategic Value Analysis. The topic compares this concept to the more
traditional concept of net present value; and demonstrates the impact of ‘free-cash
flows’ on operational value, business value, and shareholder value. It is demonstrated
that the concepts of ‘value’ and ‘strategic value’ can be quantified for planning
purposes, and in valuing companies.

10am-11.30am: Tea/Coffee Break and Case Study on Strategic Value Analysis: The
Rappa Port Authority

11.30am – 1pm: Lunch / Prayer break

1pm: Topic 11: Risk Management - Corporate Radar and Early Warning Systems
Here the concept of risk; and the approaches to risk management using short-term
(weekly) and long-term (annual) corporate radar systems are considered, in order to
determine the health of a business organisation. Popular bankruptcy prediction models
(such as Z-scores) and their reliability and relevance in the 2000s are specifically
considered.

2.45pm-3:45pm: Case Study on Early Warning Systems: Maxwell Communications

Corporation incl lunch break (30mins)

3:45pm – 4pm: Tea/Coffee Break

4 pm: Topic 12: Strategic Scorecards

This topic focuses on corporate success, and the role of non-financial indicators in
measuring and controlling this success. The importance of monitoring both the internal
and external environment is highlighted, especially in terms of a firm’s ‘critical success
factors’. The strategic consequences of having intangible assets such as Brands and
Human Capital on strategic scorecards is also considered. Finally, a strategic scorecard
that recognises the seven underlying principles of ‘sustainable value creation’ in the
design and marketing of products and services is highlighted.

5.30pm: End of Day Seven

END OF PROGRAM