Tuesday, October 18, 2011
Roll no.054/prateek kumar sharma/mba a/Jaskirat singh/Mba 3
]http://www.youtube.com/watch?v=Yj7wCQXyQMU
]http://www.youtube.com/watch?v=Yj7wCQXyQMU
assignment-2
INTRODUCTION
In economics, a recession is a business cycle contraction, a general slowdown in economic activity. During recessions, many macroeconomic indicators vary in a similar way. Production, as measured by gross domestic product (GDP), employment, investment spending, capacity utilization, household incomes, business profits, and inflation all fall, while bankruptcies and the unemployment rate rise.
Recessions generally occur when there is a widespread drop in spending, often following an adverse supply shock or the bursting of an economic bubble. Governments usually respond to recessions by adopting expansionary macroeconomic policies, such as increasing money supply, increasing government spending and decreasing taxation.
MEANING AND DEFINITION
According to an economic statistician Julius Siskin, one of the parameters of defining the recession is when there are "two down consecutive quarters of GDP".
The NBER defines an economic recession as: "a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales."
TYPES OF RECESSION OR SHAPES
The type and shape of recessions are distinctive. In the US, V-shaped, or short-and-sharp contractions followed by rapid and sustained recovery, occurred in 1954 and 1990–91; U-shaped (prolonged slump) in 1974–75, and W-shaped, or double-dip recessions in 1949 and 1980–82. Japan’s 1993–94 recessions was U-shaped and its 8-out-of-9 quarters of contraction in 1997–99 can be described as L-shaped. Korea, Hong Kong and South-east Asia experienced U-shaped recessions in 1997–98, although Thailand’s eight consecutive quarters of decline should be termed L-shaped.
IMPACTS
Ø UNEMPLOYMENT- The full impact of a recession on employment may not be felt for several quarters. Research in Britain shows that low-skilled, low-educated workers and the young are most vulnerable to unemployment in a downturn. After recessions in Britain in the 1980s and 1990s, it took five years for unemployment to fall back to its original levels. Many companies often expect employment discrimination claims to rise during a recession.
Ø BUSINESS-Productivity tends to fall in the early stages of a recession, and then rises again as weaker firms close. The variation in profitability between firms rises sharply. Recessions have also provided opportunities for anti-competitive mergers, with a negative impact on the wider economy: the suspension of competition policy in the United States in the 1930s may have extended the Great Depression.
Ø SOCIAL EFFECTS- The living standards of people dependent on wages and salaries are more affected by recessions than those who rely on fixed incomes or welfare benefits. The loss of a job is known to have a negative impact on the stability of families, and individuals' health and well-being.
Ø BANCRUPTCIES
Ø DEFLATION
Ø CREDIT CRUNCHES
CONCLUSION- Thus from the above discussion this conclusion can be drawn that no matter whether the recession is taking place in one part of the world or the other but it has a grand global effect. It affects each and every sector directly or indirectly. When there is an imbalanced relationship between the three sectors of the economy i.e. Household sector, corporate sector and govt. sector, the recession develops. So in order to help it, there should be a balanced economy.
Submitted by:Apex regiment
Prateek kumar sharma
Mba1 A
Roll no 54
Rinni /Mba b
Urvashi/Mba C
assignment -2
Assignment No. 2
Group Name-Innovators
Topic- Budgetary Control
Group members:-
Mayank Arora (A) 48
Prerna Dewan (B) 107
Suman Kumari(C) 175
Introduction:-
Budget is a financial plan and a list of all the planned expense and revenues.
There are different types of budgets.
Budgetary control: - Budgetary control is the use of comprehensive system to aid management in carrying out its functions like planning, coordination and control.
This system involves functional basis division of departments into budget centres. Preparation of separate budget for each budget units. Consolidation of all functional budgets .comparison of actual level of performance against with proper analysis to provide for future course of action.
Suman Kumari (175) Sec –C
Discussion:-
Classification of budgets:-
1. Sales budget: This budget is the forecast of actual quantities and values of sales to be achieved in the budgeted period.
2. Production budget:-It involves planning the level of production.
3. Cost of the production budget: - This budget is a estimate of cost of output planned for a budget period
4. Purchase budget:-This budget provides information about the materials to be acquired from the market during the budget period.
5. Personnel budget:-This budget gives an estimate of the requirements of direct labour essential to meet the production budget.
6. Research and Development Budget: - This budget provides an estimate of expenditure to be incurred on R&D during the budget period.
7. Cash budget:-This budget gives the estimate of the anticipated receipts and payments of cash during the budget period.
8. Master budget:-The master budget is a summary of all fundamental budgets in capsule form available in one report.
9. Fixed budgeting: This is designed to remain unchanged irrespective of the volume of output or turnover attained.
Performance Budgeting:-These days budgets are established in such a way so that each item of the expenditure is related to specific responsibility centre and is closely linked with the performance of that standard.
Zero Based Budgeting:-
· The zero based budgeting is not based on the incremental approach and previous figures are not adopted as the base.
· Zero is taken on the base and a budget is developed on the basis of likely activities for the future period.
· It helps management to find activities on which spending money is worth with its priority criteria.
Responsibility accounting:-
Responsibility accounting fixes responsibility for cost control purposes by establishing responsibility centre namely:
a) cost centre
b) profit centre
c) investment centre
Principles of responsibility accounting:-
1. Fixation of targets for each responsibility centre
2. Actual performance is compared with the targets.
3. The Variance therein are analyzed so as to fix the responsibility of centre
4. Taking corrective actions.
Prerna Dewan (107) Sec - B
Conclusion:-
Future is uncertain .we need to plan our activities wisely to achieve our goals. Likewise budget preparation and budget implementation is a crucial phase in accounting system.
Comparison between actual performance and the budgeted performance will not be effective
Without continuous and proper reporting. Keep in mind that resources are limited and optimal utilization of resources is very important for survival of every entity.
Finally to ensure the success of budgetary control system, proper follow up action has to be Taken Immediately for the Reports Submitted.
Mayank Arora (48) Sec - A
Submitted to:-
Mr.Gurdeepak Singh
Motivators - Introduction to recent development in Cost Management - 36 Jai Prabha(A) , 97 Pankaj Chanana(B)
INTRODUCTION (By Pankaj Chanana)
After decade’s relative stability in cost accounting, the increasingly competitive environment through the 1980s and 1990s has been the prime stimulus for a range of new developments in cost identification, cost management and possibly to a lesser extent in broader aspects of financial control concerned with responsibility accounting. These developments were mainly initiated in companies related to the motor industry and high tech companies in industries like computing and electronics.
DISCUSSION (By Jai Prabha)
Recent developments that have taken place in cost management:-
TARGET COSTING;
Target Costing has been given much more attention in Japan, but increasingly being taken up in the west. It is linked with both functional Cost Analysis and Value Engineering in order to design products and services which have the attributes that the market requires at the price that is prepared to pay. The initial step is to study the market place to identify the attributes that the next generation of products must have and the maximum selling price. This does not mean that the company simply provides what the market says it wants. The company may have superior knowledge of what can be provided.
The next stage of the target costing process is to identify what activities the company must embark upon in order to deliver those product attributes. These activities are then costed and total cost compared to the cost level likely to be consistent with selling at the acceptable market price after deducting a desired profit.
The distinguishing feature of target costing is its ex ante nature. Target costing says more of the detailed costing should take place at the design stage, after all most major cost elements of many manufactured products are committed at that stage and there is limited scope for reduction thereafter.
KAIZEN COSTING:
Kaizen costing also has a Japanese heritage. Kaizen refers to the process of seeking continuous improvement. Some Japanese Companies link a target costing planning process with a kaizen process once the products are in production. Other companies, for example those with short to medium product life cycles, place more focus upon target costing. Other companies, in more mature markets with longer product life cycles, place more emphasis on kaizen during operations.
Kaizen essentially tries to ensure that everyone in the company continually reconsiders how the task is undertaken and whether there is a better way of doing it.
THROUGHPUT ACCOUNTING:
Throughput accounting arose from Goldratt’s thinking in developing his theory of Constraints. In developing his theory, Goldratt was initially trying to maximise the profitability of the firm by maximising the amount that could be produced given existing production configuration and constraints. Throughput accounting as defined by Goldratt is not really a new form of accounting. It is merely an extreme form of variable costing. If the only costs which are truly variable are direct material costs, there will be no difference between throughput accounting and variable costing.
CONCLUSION: - ( By Pankaj Chanana and Jai Prabha)
Some of the developments in cost accounting are discussed here. These developments like target costing, kaizen costing and throughput accounting have enlarged the scope for cost accounting. Target costing helps designing the products and services as it is linked with both functional cost analysis and value engineering. Kaizen costing ensures that everyone in a company reconsiders how the task is undertaken or whether there is a better way of doing it. Throughput accounting may well approximate the true value costs if the focus of discussion making is on maximising throughput in short-term.
The Mentors - Ethics in Accounting - 46 Mandeep Kumar(A), 105 Pratibha Pathak(B), 172 Shiv Sparsh(C)
INTRODUCTION:(by Mandeep Kumar)
To understand the role of ethics in accounting we must analyse what is the essence of accounting ethics.
Essence Of Accounting Ethics
Accounting ethics in the field of accounting refers to the guidelines (consisting of judgments and moral values) that a professional needs to follow while practicing accounting. Just like the professionals in the field of medicine or law, an accounting professional also needs to strictly adhere to the ethics that have become a norm in accounting. The people who receive the services of an accounting professional not only rely on his skill and ability, but also on his professional integrity. People using the service of accounting professionals rely on their professional competency to take decisions and in the process also relies on the ethics followed by them.
It is due to the above reasons that the accounting professionals developed a code of conduct that all accounting professionals need to follow. The essence of the ethics lies in its use. The code of conduct or ethics entails an accounting professional to adhere to high degrees of self discipline which even goes falls beyond the legal precincts. Whenever an accounting professional becomes a member of organizations like IMA, IIA and CIA, they are directed to follow the code of conduct and ethics.
It is the responsibility of the accounting professionals to stick to the code of ethics, i.e. this is the role of ethics in accounting, so that nobody loses confidence on this noble profession. The essence of accounting ethics is in the maintenance of professional objectivity and integrity.
DISCUSSION:(by Pratibha Pathak, Mandeep Kumar, Shiv Sparsh)
Role of Ethics In Accounting:
The role of ethics in accounting is a guideline for the accountants to follow certain rules for conducting the job of accounting in a fair way. This is just to facilitate the public confidence in their accounting. There is a set of guidelines that has been set by the AICPA for the field of public accounts. The IIA (Institute of Internal Auditors) and also the IMA (Institute of Management Accounts) has issued their own code of ethics to inculcate the set ethics in the field of accounting. It is the responsibility of all Professional accounting organizations to direst all their members to follow the standard set of ethical guidelines.
The biggest question that the accounting profession faces is whether it is possible to teach ethics or not. Well, it has to be inculcated at some of time in one’s life because there is nobody in this world who comes with an inbuilt ethics mind and soul. So, it is the family, society, schools, colleges and professional organizations that carries on the continuous process of embedding ethics in a person. Same is applicable in the case of all accounting professionals. The codes of conduct that the professional organization expects their members build a sense of ethics in a professional.
Ethics in accounting is of utmost importance to accounting professionals and those who rely on their services. Certified Public Accountants (CPAs) and other accounting professionals know that people who use their services, especially decision makers using financial statements, expect them to be highly competent, reliable, and objective. Those who work in the field of accounting must not only be well qualified but must also possess a high degree of professional integrity. A professional's good reputation is one of his or her most important possessions.The general ethical standards of society apply to people in professions such as medicine and accounting just as much as to anyone else. However, society places even higher expectations on professionals. People need to have confidence in the quality of the complex services provided by professionals. Because of these high expectations, professions have adopted codes of ethics, also known as codes of professional conduct. These ethical codes call for their members to maintain a level of self-discipline that goes beyond the requirements of laws and regulations.
CONCLUSION:(by Shiv Sparsh, Pratibha Pathak)
Our belief is that ethics instruction should be incorporated into the accounting curriculum. This study provides additional support for investing in ethics instruction for accounting students as well as directions for future research. As accounting educators continue to refine methods and techniques of teaching ethics, our students will benefit. In turn ethics instruction will benefit the firms that employ our students.
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