BFA109 Applied Accounting Systems Week 2 Workshop Activities Activity 1 Which cycle do each of these items belong to Revenue Expenditure Human Resources Payroll Production or Financing Purchase raw materials E Pay off mortgage on a factory f Hire a new assistant financial controller H Establish a credit limit for a new customer E R Pay for raw materials E Electronically transfer pay to factory workers F Record goods received from a vendor F Update the allowance for doubtful debts F Decide how many units to make next month P Complete a picking ticket for a customer order R Record factory employee timecards H Sell concert tickets R Draw on a line of credit E Send new employees to a business ethics course H Pay utility bills F Pay property taxes on an office building F Pay rates and taxes on a building F Pay state payroll taxes F Sell a computer R Collect payments on customer accounts R Obtain a bank loan F Pay sales commissions e Send an order to a vendor E Put purchased goods into a warehouse E Activity 2 Case Study Strides for Strides manufactures and sells athletic wear to retail stores, who sell them on to customers Its range of products includes warm up tracksuits, body suits and running shoes and spikes The business process followed by Strides for Strides to supply retail stores is as follows Retail stores order online using a secure website that sends the order through to their allocated Strides for Strides customer service representative Orders are generated periodically by retail store managers, who typically place an order when their stocks are getting low Retail stores, while all being long standing and regular customers, have typically ordered at the last minute, resulting in irregular demand levels across the year The customer service representative checks that the goods are available and notifies the retail store when their goods will be arriving Once the order has been checked a copy goes to the accounts receivable office The goods are packed, manually recorded on the goods release form (two copies are prepared) and sent to the shipping department for dispatch A courier collects goods and a goods release form every morning and afternoon and delivers these to the retail store Once delivery details are confirmed, an invoice is prepared by accounts receivable, based on the details in the customer order and the goods release form Electronic invoices are sent out at the end of each week Retail stores currently have standard payment terms of 2 15, n 35 Payment can only be made by cheque, which is sent to the customer service representative who forwards it on to the accounts receivable office Strides for Strides has recently noticed that it is having inventory management problems due to the irregular nature of orders This has impacted on its own ability to meet customer demands It is also concerned that incorrect quantities of goods may be packed and shipped, and not detected until the goods reach the retail stores This introduces extra costs of handling returns and allowances Additionally, Strides for Strides has noticed that its accounts receivable turnover has dropped from 11 7 times per year to 9 5 times per year over the last 12 months An independent consultant has suggested that by re engineering the process these problems could be addressed Required Identify and describe any inefficiencies that are present in the business processes above Suggest ways that the business process inefficiencies could be improved Activity 3 Case Study Albert Heijn (or AH) is arguably the largest retail chain in Europe, owning supermarkets, convenience stores, and online shopping services in food and other goods AH prides itself on establishing the first modern supermarkets Founded in 1887 in Oostzaan, the Netherlands, Albert Heijn grew from a humble grocery store to a chain of supermarkets Its first supermarket was established in 1952 and, over the decades, AH has been the shopping destination of choice for most of the people living in the Netherlands, Belgium, and other European countries The chain comprises more than 850 stores, including more than 200 franchisees AH is known for being an early adopter of information technology and has been one of the first supermarkets to take on a loyalty card program Customers can receive a discount with a card called Bonuskaart in Dutch It is issued to them after their personal information is entered into a database This provides AH with a mine of information about its customers It utilises this information to expand its business and push sales REQUIRED What kind of information do you think AH gathers How do you think AH has motivated its customers to sign up for the bonus card program What can AH accomplish with the data it collects Think in terms of strategy and competitive advantage What could be some of the disadvantages of the card program

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BFA109 Applied Accounting Systems Week 2 Workshop Activities Activity 1 Which cycle do each of these items belong to: Revenue; Expenditure; Human Resources/Payroll; Production or

BFA109 Applied Accounting Systems

Week 2 Workshop Activities

Activity 1

Which cycle do each of these items belong to: Revenue; Expenditure; Human Resources/Payroll; Production or Financing?

Purchase raw materials: E
Pay off mortgage on a factory: f
Hire a new assistant financial controller: H
Establish a credit limit for a new customer: E/R
Pay for raw materials: E
Electronically transfer pay to factory workers: F
Record goods received from a vendor: F
Update the allowance for doubtful debts: F
Decide how many units to make next month: P
Complete a picking ticket for a customer order: R
Record factory employee timecards: H
Sell concert tickets: R
Draw on a line of credit: E
Send new employees to a business ethics course: H
Pay utility bills: F
Pay property taxes on an office building: F
Pay rates and taxes on a building: F
Pay state payroll taxes: F
Sell a computer: R
Collect payments on customer accounts: R
Obtain a bank loan: F
Pay sales commissions: e
Send an order to a vendor: E
Put purchased goods into a warehouse: E

Activity 2 Case Study

Strides for Strides manufactures and sells athletic wear to retail stores, who sell them on to customers. Its range of products includes warm-up tracksuits, body suits and running shoes and spikes. The business process followed by Strides for Strides to supply retail stores is as follows:

Retail stores order online using a secure website that sends the order through to their allocated Strides for Strides customer service representative. Orders are generated periodically by retail store managers, who typically place an order when their stocks are getting low. Retail stores, while all being long-standing and regular customers, have typically ordered at the last minute, resulting in irregular demand levels across the year. The customer service representative checks that the goods are available and notifies the retail store when their goods will be arriving. Once the order has been checked a copy goes to the accounts receivable office.

The goods are packed, manually recorded on the goods release form (two copies are prepared) and sent to the shipping department for dispatch. A courier collects goods and a goods release form every morning and afternoon and delivers these to the retail store. Once delivery details are confirmed, an invoice is prepared by accounts receivable, based on the details in the customer order and the goods release form. Electronic invoices are sent out at the end of each week. Retail stores currently have standard payment terms of 2/15, n/35. Payment can only be made by cheque, which is sent to the customer service representative who forwards it on to the accounts receivable office.

Strides for Strides has recently noticed that it is having inventory management problems due to the irregular nature of orders. This has impacted on its own ability to meet customer demands. It is also concerned that incorrect quantities of goods may be packed and shipped, and not detected until the goods reach the retail stores. This introduces extra costs of handling returns and allowances. Additionally, Strides for Strides has noticed that its accounts receivable turnover has dropped from 11.7 times per year to 9.5 times per year over the last 12 months.

An independent consultant has suggested that by re-engineering the process these problems could be addressed.

Required

Identify and describe any inefficiencies that are present in the business processes above.

Suggest ways that the business process inefficiencies could be improved.

Activity 3 Case Study

Albert Heijn (or AH) is arguably the largest retail chain in Europe, owning supermarkets, convenience stores, and online shopping services in food and other goods. AH prides itself on establishing the first modern supermarkets. Founded in 1887 in Oostzaan, the Netherlands, Albert Heijn grew from a humble grocery store to a chain of supermarkets. Its first supermarket was established in 1952 and, over the decades, AH has been the shopping destination of choice for most of the people living in the Netherlands, Belgium, and other European countries. The chain comprises more than 850 stores, including more than 200 franchisees.

AH is known for being an early adopter of information technology and has been one of the first supermarkets to take on a loyalty-card program. Customers can receive a discount with a card called Bonuskaart in Dutch. It is issued to them after their personal information is entered into a database. This provides AH with a mine of information about its customers. It utilises this information to expand its business and push sales.

REQUIRED