Running head: Riordan Manufacturing

Accounting System Paper Jennifer Kiser BSA/310 April 23, 2012 Joseph Duer

Riordan Manufacturing

Accounting System Paper

Riordan Manufacturing is a global plastics manufacturer that employees 550 people. Their projected annual earnings are project to be $46 million. The company manufactures plastic beverage containers at its plant in Albany, Georgia, custom plastic parts at its plant in Pontiac, Michigan, and plastic fan parts produced at its Hangzhou, China plant. At the corporate headquarters in San Jose is where the companys research and development is done at. The major customers for Riordan are automotive parts manufactures, aircraft manufactures, the Department of Defense, beverage makers and bottlers, and appliance manufactures. Riordan Manufacturing has grown to become both nationally and internationally known as a leader in the production of plastic products. The sales and marketing departments use databases to record sales as well as keeping additional paper files and microfiche. It would benefit the company if all this information was compiled into one congruent system. That will allow the department to project sales by drawing information from one source. Currently employees have to rely on paper copies to review and research on past marketing research, marketing plans and design awards. Riordan Manufacturing has three operating entities: Georgia, Michigan and California, plus a joint venture in the Peoples Republic of China. Each location has its own Finance and Accounting Systems and they provide input that is consolidated at the corporate off in San Jose. The basic components of each system are as follows: General Ledger, Accounts Payable, Accounts Receivable, Order Entry, Procurement, Sales and Purchasing History, Invoicing and Shipping, Payroll, Financial Reporting, EDI, Bar Code Reading, and EDSS (Executive Decision Support System). The current situation regarding F & A systems area s follows: San Jose, has a license for a fully integrated Windows based ERP

Riordan Manufacturing

manufacturing, distribution and financial management software application specifically designed for plastics processors and process and assembly manufacturers. Michigan had purchased a vendor developed software application and the attendant source code for their F & A and process application. However, the vendor is no longer in business. The applications run on a pair of DEC Alphas, using the VMS operating system, VAX4000 work stations and programmed in C. The Georgia location also purchased a vendor (it is different from Michigan) developed software application and the attendant source code for their F & A and manufacturing process applications. Their system runs on a pair of AS400s using UNIX operating system, the use of PCs (Windows) as workstations, and is programmed in RPG400. According to Sales Chart for 2005, Riordan had the best month in April. The sales plan for 2006 is to help the sales organization prioritize activities and resources for 2006 in an effort to meet or exceed the stated sales objectives. There is a two year plan to reach $50 million revenue mark; the object was developed collaboratively with Dr. Riordan along with the executive team. The theme for the sales plan 2006 is Reaching the $50 Million Mark! there are three parts to the plan. Part 1: Strategic sales objectives with corresponding financial goals and roll-out schedules; Part 2: Tactics by marketing mix, timing, and relationship to strategic sales objectives; and Part 3: Customer Relationship Management Strategies. The marketing department, with the support of the finance and production departments, maintains the profit and loss statements. Riordan has the following situations regarding F & A systems outputs:

Riordan Manufacturing

Consolidated close of General Ledger and subsequently the Income Statement and Balance Sheet is labor intensive and normally not completed until 15-20 days after month end.

Audit (to include external auditors) is required each month and is costly and labor intensive. Compliance with new government required reporting requirements at the consolidated level is difficult at best.

Riordan Enterprises finds the situation unacceptable and has mandated a solutions(s)/alternatives be recommended soonest. (Riordan, 2012)

According to the Riordan Manufacturing, Inc. Consolidated Balance Sheet for 2005, Riordan had a total of $14,555,092 for Total Current Assets and $6,974,094 Total Current Liabilities. The total liabilities and stockholders equity is $34,592,182 for the year 2005.

Riordan Manufacturing has a good strategic plan for the future. Riordan strives to be a solution provider for their customers, and not provide any challenges. The company is focused on continuing to be the industry leader in identifying industry trends. Their goal for the future is to be focused in achieving and maintaining reasonable profitability to assure that the financial and human capital is available for sustained growth. With their 2 year plan of reaching $50 million Riordan will rise above any challenges and will be very prepared for the future years of business.