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ACCA F1 Accountant in Business

Sample Study Note

For exams in DEC2014









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Lesco Group Limited, April 2015
All rights reserved. No part of this publication may be reproduced, stored in a
retrieval system, or transmitted, in any form or by any means, electronic,
mechanical, photocopying, recording or otherwise, without the prior written
permission of Lesco Group Limited.

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Sample Note Content:

Product Summary .......................................................................................... 4
Live online course timetable ............................................................................ 5
Main study note content [Total Pages: 67] ........................................................ 7
Organization ............................................................................................... 8
Parts within organization ............................................................................ 18
1. Roles & Functions within organization ...................................................... 19
2. Teams .................................................................................................. 25
3. Committees .......................................................................................... 29







Please note:
This is just the sample study note extracted from the main study note in your tuition study
[This tuition study note is consistent in basic/super/gold package]. There would be more
chapters in the main study note covering the whole ACCA syllabus.
You can also take a look at the content within the main study note below:



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Product Summary














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Live online course timetable


Timetable: [Super+Gold package-additional revision would
be agreed between tutor and student]
Live Online Revision
Live revision1 Live revision2
F5 Performance management 25
th
Oct 7:00a.m.-14:00 22
nd
Nov 6:00a.m.-13:00
F7 Financial Reporting (INT) 2
nd
Nov 6:00a.m.-13:00 29
th
Nov 6:00a.m.-13:00
F8 Audit and Assurance (INT) 18
th
Oct 7:00a.m.-14:00 19
th
Oct 7:00a.m.-14:00
F9 Financial Management 4
th
Oct 7:00a.m.-14:00 5
th
Oct 7:00a.m.-14:00
P1 Governance, Risk and
Ethics
1
st
Nov 6:00a.m.-13:00 30
th
Nov 6:00a.m.-13:00
P2 Corporate Reporting (INT) 26
th
Oct 7:00a.m.-14:00 9
th
Nov 6:00a.m.-13:00
P3 Business Analysis 11
th
Oct 7:00a.m.-14:00 12
th
Oct 7:00a.m.-14:00
P4 Advanced Financial
Management
8
th
Nov 6:00a.m.-13:00 23
rd
Nov 6:00a.m.-13:00
P5 Advanced Performance
management
15
th
Nov 6:00a.m.-13:00 16
th
Nov 6:00a.m.-13:00
P7 Advanced Audit and
Assurance (INT)
27
th
Sept 7:00a.m.-14:00 28
th
Sept 7:00a.m.-14:00
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Last minute revision
Last minute revision Tutor
F5 Performance management 28
th
Nov 12:00-14:00 Ian
F7 Financial Reporting (INT) 1
st
Dec 12:00-14:00 Steve
F8 Audit and Assurance (INT) 22
nd
Nov 14:30-16:30 Alan
F9 Financial Management 22
nd
Oct 12:00-14:00 Steve
P1 Governance, Risk and Ethics 30
th
Nov 13:30-15:30 Alan
P2 Corporate Reporting (INT) 16
th
Nov 14:00-18:00(4hrs) Kieran
P3 Business Analysis 18
th
Oct 14:30-16:30 Alan
P4 Advanced Financial Management 19
th
Nov 12:00-14:00 Steve
P5 Advanced Performance management 21st Nov 12:00-14:00 Ian Janes
P7 Advanced Audit and Assurance (INT) 23
rd
Nov 13:30-15:30 Alan













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Main study note content [Total Pages: 67]





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Organization

















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1. Purpose of organization

1. What is organization?

An organization would have these characteristics:
A group of people with a common objective;
Everybody would have their own responsibility(social arrangement);
There would be rules existed to control employees performance.

Eg,
A group of people in the train is not an organization


2. Why organization?

Having an organization we can work better!

Overcoming limitations (physical and intelligent, or mental).
Create Synergy :1 + 1 >2.
Expertise
Time saving division of labours.






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2. Types of organization

1. Private sector (profit making organization) and public sector (non-profit
making organization-NPMO)

Private sector
Sole trader
One person owns and runs the business.
The sole trader and the business are legally the same entity and therefore the sole trader is
personally liable for any business debts.

Partnership
Two or more persons owns and runs the business.
The partners and the business are legally the same entity and therefore the partners are
jointly liable for any business debts.

Limited liability company
Shareholders and a number of appointed directors own and run the business.
A company is a legal entity in its own right, and therefore the shareholders only have
limited liability for any business debts.

Public sector (Run by government)
(non-profit making organization-NPMO)

Public schools and education institutions;
Hospitals;
The Central Bank;
The Army, Navy and the Air Force;
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The national social and security organisation



2. Non-governmental organization(NGOs)(Run by individual)
(non-profitmakingorganziation)

This is for the social benefit and thats why its set up.

This is not run by government but by individuals and so individuals need to raise
money from the outside and this is very difficult.















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3. Structure of organization

Types of structures:

The organization would be arranged in many ways:

1. Simple (Entrepreneurial) Structure
Advantage: This is quick when decision is made.
Disadvantage: if boss is away then the origination cant do anything.
Boss

Team


2. Functional Structure
Advantage: its cheap to run because there is just 1 department and its good if
you just own one/similar product.
Disadvantage: if you have any products then its not suitable.

Boss

Department1 Department2

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3. Divisional Structure

Advantage: more concentrate on customers and its suitable for many products.
Disadvantage: more costly
Boss

Dicision1 Division2

Dept1 Dept2 Dept1 Dept2


4. Matrix Structure

Advantage: more flexible in decision making
Disadvantage: more costly








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Span of control
This means number of people specifically reporting to their direct boss.
Note: number of people below their direct boss is not span of control.
This would determine either there would be a tall structure or a flat structure.
Tall structure: you focus on the quality.(reduce span of control)(Centralisation):
This means lots of levels in the hierarchy (long Scalar chain).

Flat structure: you focus on the effectiveness.(increase span of control)
(Decentralisation)
This means fewer levels in the hierarchy (short Scalar chain).

But how to decide span of control? (Factors affecting span of control):

1. Workload
Planning work (non-supervisory job)less span of control
Decision making work (non-supervisory job)less span of control
Control work(supervisory work)---can increase span of control
2. Competence

3. Style
Control directive (task-focus): decrease span of control
Delegation (people-focus): increase span of control.

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4. Support
If employees can help each other then you can increase span of control.
Models/theories of structure

1. Anthony hierarchy

Roberts Anthony identified management activities, at three different levels:

1. Strategic: board of directors; (What to do: Market leader in education field)

2. Tactic: middle management;(Detail what to do and How to do it)

3. Operational: front line workers. (Just do it)

But a comment on this is not all employees within company would focus on how to
do the work based on Strategy. And not everybody knows strategy within the
compay and hence:









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2. Mintzbergsorganisation configuration

Mintzberg divides the organisation into 5 aspects:

People know strategy:
StrategicApex senior management
Middleline middle managers
Operatingcore employees directly involved in producing goods and services

People not know strategy:
Technostructure providing technical support about how to do it from tactic level.
Supportstaffproviding general supportlike public relations, legal consultancy,
Canteen staff










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Formal & Informal Structures

The above structures we looked at are formal structures.

And there would be informal structures as well in the organization.


















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Parts within organization

There are basically 3 parts within an organization:
1. Functions
2. Teams
3. Committees

















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1. Roles & Functions within organization
So why do we have roles and functions within organization?

Well if the roles and functions cant add value to the organization, why do we keep
them?

So this is the concept behind PORTERS VALUE CHAIN.


The five primary activities are:
Inbound logistics (Inventory storage)
Operations, (Add value)
Outbound logistics, (Distribution)
Marketing and sales (Advertising etc)
After sale service. (installation; repairmentetc)

The four secondary (support) activities are:
Firm infrastructure (general management; Accounting & Finance)
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Human Resource Management, (Recruiting & Training staff)
Technology Development(R&D on product & Process)
Procurement.(selecting suppliers & purchasing strategy & Capital investment)
Different departments:

The purchasing department would deal with
Inbound logistics (Inventory storage)
Procurement.(selecting suppliers & purchasing strategy & Capital investment)

When determining purchasing strategy we can consider the purchasing mix:
1. Quantity
2. Quality
3. Price
4. Delivery


The production department deals with operation of materials and turns those
into finished goods. They aim at efficiency during the operation process.

Outbound logistics(Distribution) is normally outsourced by company to 3
rd
party to
distribute goods on behalf of us.





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The marketing department would deal with marketing and sale bits.

Marketing means to turn people into potential buyers by launching lots of
campaigns.
Sales means to turn potential buyers into the real buyers. Normally its referring to
direct sales.
How to be able to successfully market our products would depend on marketing mix.

Marketing mix for tangible products: 4Ps(Why customer would come and buy your
products?)

Product: Because your product is good and unique so they buy them.

Price: Because your products offer a very low price and hence customers buy them.

Price skimming:
Aim at small group of people and charge them at a high price for a small
amount of goods
Low risks:
1, we don't have to develop too many products which costs us that much
2, we can drop the price down as we see fit.
3, High barrier to entry, Eg, technology

Price penetration:
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Aim at large group of people and charge them at a low price for a large
amount of goods
High risks
1, we have to develop too many products which costs us that much
2, we cant drop the price down easily as we see fit.
3, No barrier to entry

Place: Because your product place is convenient for the customer so they buy
them.
Eg, you distribute your products directly to customers etc,
Eg, You give the right to Retailer and customers can buy from retailer directly which
would be convenient for them.

Promotion: Because theres an attractive promotion for your products and hence
customer buy them.

Marketing mix for Service: (Add another 3Ps):
People: Who delivers service would have an impact on whether your product would
be successfully sold.

Processes: by which the service is delivered: watch online?
Physical evidence of the service: Small gifts?
Accounting & Finance department

Accountants do lots of things:

Financial accounting: prepare Financial statements for different stakeholders.
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Step1: transaction and source document
Step2: books of prime entry
Step3: ledger & balance off the account
Step4: trial balance
Step5: year end adjustment journal
Step6: FS(SOFP & SOCI)


Accounting standards develops from IAS to IFRS. Development process:

Draft Proposal

Working group to have some suggestions

Publish discussion document-to allow people see what you are doing

Public comment

Exposure draft (like a practice but not compulsory)

IFRS



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Management accounting:

Planning: Plan future activities, budget
Decision making: Whether to set up company and what further investment that
company may try to make

Control: Variance-Compare results of operation with expected(meet sales/ cost
target?)

Financial management: investment; financing & dividend policy

Tax issues:
Pay tax
Tax avoidance: legal
Tax evasion: illegal














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2. Teams

There are 2 characteristics of teams:

Complementary skills-this means members within the team would help each other.
Mutually accountable-this means members would hold accountable with each other,
for example, if a team is to design one product, there is no point that Mary within
the team would say to Tony within the team that, you design and I leave.
















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Teams Roles: (Belbins team roles theory)

Belbin said there are 3 types roles within a team: thinking, people and action
oriented
role.

Types Roles
Thinking oriented:
Plant: Only Provide Creative Ideas Solve difficult problems
Monitor-Evaluator: Assessing the contributions of others.
Specialist Only specialize in his area but cant see the
whole picture

People oriented:
Co-coordinator: overall leader CEO/chairman
Team worker: supportive not competitive Giving support to others
Resource investigator People who always exploit opportunities

Actions oriented:
Shaper: keep teams moving Middle line managers
Implementer: manufacturing actual product Front line workers
Completer-finisher: look for errors Quality checking Dept; internal auditors








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There are 4 types of teams: (MD, MS, SM, Virtual)

Multi-discipline teams: this is a typical team with different people with different
skills and knowledge working together.

Multi-skills teams: this means one person within the team can finish the whole
project. This type of team is flexible meaning each of them can finish the project on
their own but the disadvantage of this would be TOO EXPENSIVE!

Self-managed teams: like professionals within the team like lecturers, although
they are within the team but they would have high level of autonomy of deciding
how to do it.

Virtual teams: this means members within a team would communicate with each
other using WEBINAR like Skype etc and this is through virtual communication.












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Tuckmans Development of the team theory
1. Forming
Just several members get together and know each other.
No leader is in this stage.

2. Storming
In this stage conflict among members exists.
Members may disagree with each other but company is growing.

3. Norming
Members have a common goal with meetings.
Members accept each other.
Company is growing very fast.

4. Performing
Get the tasks done.
Leader tells you what do to and you know how to do it.

5. Dorming
This means members doing the same things over and over again without thinking
and hence its hard for them to provide new thinking.

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6. Mourning/ Adjourning.
Members leave. Mourning
Members start a new project. Adjourning
3. Committees

What
Groups of members to solve complicated issues.

1. They have functions.
2. They stand for different stakeholders interest.

This is between functions and teams.
Function specializes in each function like accounting etc.
Teams are effective.

There are 3 types of committees:
Level:
Executive committees Board of directors
Management committees Quality control committee

Time
Permanent committees
Temporary committees(Ad hoc committee)

Overall & Sub
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Joint committee Quality control committee
Sub committee Like material, human and
distribution committee under the
overall quality control committee

People:
Committee chair
Should be impartial and punctual and regular in attendance at meetings.

Committee secretary should:
Before meeting: prepare the date, place for meeting.
During meeting: Help chair documenting notes.
After meeting: prepare minutes, like decision made by the committee.


How to use committees successfully?
Competence
There are minimum number member attending the meeting, like 4 out of 7.
Clear authority given








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