how do I prepare a reportto evaluate the suitability of the branch information given as a means of assessing the shop managers performance for this store, providing relevant additional calculation

ESSEX BUSINESS SCHOOL University of Essex BE113 MANAGEMENT ACCOUNTING II Spring 2017 Individual Coursework (25%) / Due date: Tuesday, 21 March 2017 There are two distinct parts to this assignment: an essay and a case study involving the use of numbers for discussions & recommendations. Please answer both parts and submit the work as a single document (Part A and Part B) Despite Group of companies (DP) operates a chain of 24 shops specialising in selling items associated with the game of cricket: helmet, batting gloves, leg guards, and batting boots among others. Three years ago, the company was the subject of a venture capital buyout from a larger group. A new senior management team was put in place after the buyout. They have the aim of running the business in order to maximise profits. The Chief Financial Officer (CFO), along with the other members of senior management, sets the annual budget and uses a standard costing approach with a variance analysis in order to control individual shop performance. The head office handles all capital purchases and brand marketing. All inventory purchasing is done centrally and the shop opening times are set as standard across the company. As an illustration of senior management attitude, the CFO had set the budget for staff costs at 7 per hour for part-time staff and this was rigorously observed in the period. Each shop is run by a manager who reports their financial results to head office. The shop managers recruits and manage the staffing of their shop. They have some autonomy in setting prices locally and have been given authority to vary prices by up to ten per cent from a master list produced by the CFO. They also have a local marketing budget agreed each year by the shop's manager and the marketing director as part of the annual appraisal process. The shop managers have approached the chairman of DP to complain about the way that they are managed and remunerated. They feel that their efforts are not recognised by senior management. One manager at the Spintex branch commented, \"I have had a successful year on hard economic circumstances. I have run a number of promotions in the shop that have been well received by the customers. However, the budgets that are set are impossible to achieve and as a result I have not been paid any bonus although I feel that I have done everything in my power to bring in good profits\". The shop managers at DP are paid a basic salary of 27,000 with bonuses of up to 30% of basic salary dependent on two factors: performance above budget and the operational director's performance assessment. The budget for the next year is prepared by the CFO and presented at the shop manager's annual appraisal. DP's chairman has come to you to ask if you can consider the system of performance assessment for the shop managers and give an independent perspective on the reward systems at DP. She has provided the following illustrative information from the previous year for one shop: DP Stores Tesano Branch Budget for the Year to September Budget Actual Variance Sales 266000 237100 -28900 Cost of sales 106400 94840 11560 Gross Profit 159600 142260 -17340 12000 11500 500 Marketing Staff costs Manager 27000 27000 0 Part-time staff 38000 34000 4000 Property costs 26600 26600 0 Shop Profit 56000 43160 -12840 Notes: Property costs include heating, lightening and rental. The manager of the Tesano shop commented at the appraisal meeting that she felt that the assessment was unfair since her failure to meet the budget was due to general economic conditions. The industry as a whole saw a 12% fall in revenues during the period and the budget for the period has been set to be the same as in the previous period. She was not paid a bonus for the period. Required: Part A (maximum 750 words, 50% of the coursework marks) With reference to the comments by the Tesano branch manager, prepare a report to evaluate the suitability of the branch information given as a means of assessing the shop manager's performance for this store, providing relevant additional calculations. Part B (maximum 750 words, 50% of the coursework marks) With the reference to the comments by the Spintex branch manager, critically evaluate the budgetary practices that may have led to such comments. You should seek to support your discussion with relevant academic literature, and where appropriate, real-life cases or examples. Important notes and instructions 1. The report and essay should not exceed 750 words for each part or 1,500 words in total (excluding title page, references, bibliography and appendices) and must be typed using 12pt font, double spaced. State your word count on the cover sheet. 2. All essays must be submitted via FASER by 21 March 2017, 09:00AM. Details are available on Moodle and in your student handbook. More information concerning late submission of coursework or absence from in-class tests, can be found here: http://www2.essex.ac.uk/academic/services/students/crswk_pol.htm 3. Note that this coursework invites you to reflect and provide your own opinion/argument on the topic, which means that there is no right or wrong answer. You are advised to refer to materials from the relevant lectures plus recommended readings to get a basic understanding on the topic. You should then carry out additional research by searching for relevant research articles, practitioner literature, published case studies, and news and media reports that can help you develop an opinion/argument on the topic. There is no minimum requirement regarding the number of references that you must use but essays that are well-researched will normally attract a higher mark than those that are not. All sources used must be properly cited and referenced (Harvard referencing style is required). 4. The overall quality of your writing may affect your mark. You should therefore aim to present your ideas in an organised manner and demonstrate coherence in your argument. A basic essay structure should normally consist of an introduction, body, and a conclusion. 5. University Regulation 6.21: It is an academic offence for a student to engage in unfair academic practices or to cheat in any examination, or in any other submitted part of his or her University work, whether or not such work is formally assessed. A student may be found guilty of an academic offence whether or not there has been intention to deceive; that is, a judgement that negligence has occurred is sufficient to determine guilt. See more information of academic offences here: http://www.essex.ac.uk/about/governance/regulations/affairs.aspx#cheating 6. More information concerning late submission of coursework or absence from in-class tests, can be found here: http://www2.essex.ac.uk/academic/services/students/crswk_pol.htm 7. University Regulation 6.21: It is an academic offence for a student to engage in unfair academic practices or to cheat in any examination, or in any other submitted part of his or her University work, whether or not such work is formally assessed. A student may be found guilty of an academic offence whether or not there has been intention to deceive; that is, a judgement that negligence has occurred is sufficient to determine guilt. See more information of academic offences here: http://www.essex.ac.uk/about/governance/regulations/affairs.aspx#cheating 8. Students requiring ebslearn@essex.ac.uk support may contact EBS learning team