Clint Jan Salvaña

2012-51494 MM Block B – M212

In-depth Analysis of English Knowledge

Awareness (EKA)’s Managerial Accounting System

In definition Management Accounting is the provision of financial data and the process of
preparing management reports and accounts that provide accurate and timely financial and
statistical information required by managers to make their day-to-day and short-term decisions
(BusinessDictionary.com, 2018). As I have observed, most of the practices and methodologies in
Management Accounting is not known but were utilized in making sure that the business has good
decisions

English Knowledge Awareness, Inc. (EKA), a learning center was born out of the higher
thoughts of its dedicated owners Sam and Jessica. The two have a common vision of
strengthening English skills of Korean and Filipino students in Davao City, Philippines. EKA was
then established by the two in Matina, Davao City in 2005 and have been providing English
language interest to many students. EKA offers a wide range of teaching methods, a thorough
Spartan management process and a high-quality English language curriculum. EKA caters
students who want to overcome their anxiety about English. The learning center envisions a path
that will open the way for a systematic English language. Since the establishment of the company
in 2005, they have gained wonderful milestone that provided them credibility, expertise, and
excellence in English teaching and training. In 2007, EKA acquired accreditation from TESDA and
CHED. This enables the company to carry out a training program. TESDA accredited EKA to offer
a Technical Vocational Education Training (TVET) Program for Integrated Language Program. In
2012, EKA acquired a special study permit from the Bureau of Immigration. This allows the
company to publicly target foreign students in the Philippines and even outside of the country. This
gave more emphasis to the vision of the owners which is to strengthen the English skills of foreign
students aside from the Filipino students. In 2016, EKA was not able to keep up with its competitors
in the city. In response to this, EKA decided to change the company’s branding and have
incorporated Mathematics courses to widen their market niche. This allowed the company to
recover from its downfall.

The Management Accounting practices of EKA is not really that established. Starting with
the organizational structure of EKA, they do not have an accountant to manage the company’s
finances. Their organizational structure is composed of 5 major components and none of which
focuses on handling the finances of the company. These components were the (1) owners which
are the de facto decision-makers, (2) administrator the one who governs all administrative tasks
concerning the learning center, (3) headteacher the one who allocates courses and provides
general feedback to the students and the teachers, (4) English department are where the teachers
who specialize in English were assigned, and (5) Math department is where the teachers who
specialize in Mathematics were assigned.

Figure 2. Organizational Chart of EKA, Inc.

As shown in the organizational structure of EKA, there is no sole finance/accounting

department or unit established to manage the company’s finances. These tasks are done
primarily by the administrator who also does other relevant company responsibilities (i.e.
human resource, timekeeping, etc.). In today’s competitive market, one is at a disadvantage
by having no finance/accounting personnel to safeguard the finances of the company. Though
this is the case, it is good to note that the administrator has enough experience to utilize
various statistical and financial methodologies in its decision-making procedures. The
administrator has been putting EKA’s greater attention to cost planning and cost reduction
tools. This is possible with the help of the owners which is the de-facto decision makers of the
company. One scenario where this strategy was utilized is when EKA wanted to make a
purchase towards the company's equipment which includes computers, books, etc. By
completing a cost planning and/or a make or buy analysis, they were able to determine which
choice is more profitable.
On my point of view, there’s still much to improve and implement in terms of the
methodologies of Management Accounting in EKA. Though, EKA has been utilizing these analyses
and methodologies, they can still try to do many ways to improve their processes and bring the
best out of the company.

References:
management accounting. BusinessDictionary.com. Retrieved May 07, 2018, from
BusinessDictionary.com website: http://www.businessdictionary.com/definition/management-
accounting.html