41. Financial Performance (AAT)

The content of this particular qualification includes the following:

41.01. Management accounting techniques: FINANCIAL PERFORMANCE, SOURCES OF MANAGEMENT INFORMATION, FINANCIAL ACCOUNTING & MANAGEMENT ACCOUNTING, Financial accounting, Management accounting, Financial & management accounting compared, MANAGEMENT ACCOUNTING SYSTEMS, Methods of costing, ABSORPTION COSTING, Terminology: Steps in absorption costing, MARGINAL COSTING, ACTIVITY BASED COSTING (ABC), Background to ABC, Cost pools & cost drivers, COSTING SYSTEMS & RECORDED PROFIT, Variations in inventory valuation, The effect of inventory valuation on profit, COMPARISON OF ABSORPTION & MARGINAL COSTING, ABSORPTION COSTING, MARGINAL COSTING, Calculating fixed & variable costs - the high-low method, The high-low method incorporating stepped fixed costs, Practical limitations of cost behaviour, RESPONSIBILITY CENTRES, Cost centres, Profit centres, Investment centres, MANAGEMENT INFORMATION TECHNIQUES, Primary & secondary data, Census of sample?, SAMPLING, Random sampling, Quasi-random sampling, Non-random sampling, TIME SERIES ANALYSIS, An identical annual change, Average annual change, Constructing a graph, Using a formula, Using a formula for more calculations, Linear regression, TIME SERIES ANALYSIS & SEASONAL VARIATIONS, Analysing historical actual data, How do moving averages work?, Dealing with an even number of 'seasons', INDEX NUMBERS, Leading & lagging indicators, Weightings of indices, Calculations using index numbers, Creation of an index, TECHNIQUES USING DISCOUNTED CASH FLOW (DCF).

41.02. Standard costing – direct costs: BACKGROUND TO STANDARD COSTING, Advantages of standard costing, COMPOSITION OF STANDARD COSTS, Elements of standard costs, Absorption costing & marginal costing models, Standard direct material costs, Standard direct labour costs, Variable & fixed overheads, SOURCES OF INFORMATION FOR STANDARD SETTING, The amount of material, The cost of material, The amount of labour time, The labour cost per unit of labour time, CALCULATION OF DIRECT COST VARIANCES, DIRECT MATERIAL VARIANCES, Total direct material variance, Direct material price variance, Direct material usage variance, Remembering how to calculate direct variances, DIRECT LABOUR VARIANCES, Total direct labour variance, Direct labour rate variance, Direct labour efficiency variance, Idle time variance, USING VARIANCES TO RECONCILE ACTUAL WITH STANDARD COSTS, Reconciliation statements, MATERIAL PRICE VARIANCES USING BOUGHT QUANTITIES, OTHER CALCULATIONS USING VARIANCES, THE MAIN CAUSES OF VARIANCES.

41.03. Standard costing – variable & fixed overheads: OVERHEAD VARIANCES, VARIABLE OVERHEADS, Variable overhead expenditure variance, Variable overhead efficiency variance, FIXED OVERHEADS, Fixed costs: absorption or marginal costing?, Using absorption costing for fixed costs, Using marginal costing for fixed costs, FIXED OVERHEAD VARIANCES - MARGINAL COSTING, Fixed overhead expenditure variance, FIXED OVERHEAD VARIANCES - ABSORPTION COSTING, Total fixed overhead variances & expenditure & volume variances, Will the plan work? - possible imbalances, Fixed overhead double-entry account, Fixed overhead expenditure & volume variances, The absorption base, Calculation of fixed overhead expenditure & volume variances, FIXED OVERHEAD VOLUME SUB-VARIANCES, Fixed overhead efficiency variance, Fixed overhead capacity variance, Fixed overhead variances - a summary, INTERPRETATION OF FIXED OVERHEAD VARIANCES, Fixed overhead expenditure variance, Fixed overhead volume variance, Output volume differs from budgeted volume?, Using efficiency & capacity variances to explain the volume variance, APPORTIONMENT OF FIXED OVERHEADS, THE APPLICATION OF FIXED OVERHEAD VARIANCES TO THE SERVICE SECTOR, The use of standard hours, USING AN APPROPRIATE RESOURCE, Which resource should be used?. 

41.04. Standard costing – further analysis: A SUMMARY OF VARIANCES, SETTING STANDARDS, Types of standard, Ideal & attainable standards & actual results, IDEAL STANDARDS & THEIR IMPLICATIONS, The tendancy for dual standards, The dangers of informal standards, Ideal standards & motivation, ATTAINABLE STANDARDS & THEIR IMPLICATIONS, BASIC STANDARDS & THEIR IMPLICATIONS, INTERPRETING VARIANCES, Is the variance significant? - control limits, Modifying standards, Short-term changes, Long-term changes, INTERPRETING SPECIFIC DIRECT VARIANCES, Direct material price variance, Direct material usage variance, Direct labour rate variance, Direct labour efficiency variance, Looking beyond the obvious, ANALYSING DIRECT VARIANCES, INFLATION, Labour rate indexation, ACCOUNTING FOR STANDARD COSTS & VARIANCES, Journal entries, A COMPREHENSIVE VARIANCE ANALYSIS CASE STUDY.

41.05. Measuring quality: QUALITY & VALUE, Quality, Quality & customer satisfaction, Quality in services, Quality & value, Enhancement of value, TOTAL QUALITY MANAGEMENT, Implementing TQM, The costs of quality, The benefits of Total Quality Management, MEASURING THE COSTS OF QUALITY, Implicit & explicit costs of quality, Assessing quality, Quality at any cost?, COST REDUCTION, Cost reduction programmes, Approaches to cost reduction, Methods of assessing possible cost reductions, Other methods of cost reduction, VALUE ENGINEERING & VALUE ANALYSIS, Definitions of value engineering & value analysis, Practical aspects of value engineering & value analysis, Advantages of value engineering & value analysis, TARGET COSTING, Advantages of target costing, Target costing & value engineering, LIFE CYCLE COSTING, Problems of life cycle costing, Life cycle costing & decision making, LIFE CYCLE COSTING & DISCOUNTED CASH FLOW. 

41.06. Measuring performance: MEASURING THE PERFORMANCE OF ORGANISATIONS, Performance indicators, Making comparisons - benchmarking, Making comparisons - time series, Making comparisons - consistency, Data for performance measurement, RATIO ANALYSIS, Sources of data for ratios, CALCULATION OF RATIOS: THE STATEMENT OF PROFIT OR LOSS, RATIOS LINKING TURNOVER & PROFITS TO THE STATEMENT OF FINANCIAL POSITION, Return on capital employed (ROCE), Asset turnover, CALCULATION OF RATIOS: CURRENT ASSETS & LIABILITIES, Calculation of working capital ratios: the current ratio, Calculation of working capital ratios: the quick ratio, WORKING CAPITAL RATIOS LINKING THE INCOME STATEMENT & STATEMENT OF FINANCIAL POSITION, Receivable collection, Payables' payment period, Inventory holding ratios, Ratios: The whole picture, FINANCIAL STRUCTURE RATIOS, Gearing ratio, Gearing (debt to equity) ratio, NOTES ON CALCULATION & INTERPRETATION OF RATIOS, Behaviour of ratios, HINTS ON USING FORMULAS, LIMITATIONS OF RATIO ANALYSIS.

41.07. Measuring performance – further aspects: FINANCIAL INDICATORS, Financial indicators: adjustments to real terms, Financial indicators: calculating averages, Financial indicators: value added, NON-FINANCIAL INDICATORS, QUALITATIVE (NON-NUMERICAL) MEASURES, MEASUREMENT OF PRODUCTIVITY & EFFICIENCY, Unit cost, CONTROL RATIOS: EFFICIENCY, CAPACITY & ACTIVITY, Efficiency ratio, Activity ratio & production volume ratio, Capacity ratio, PERFORMANCE MEASUREMENT IN SERVICE ORGANISATIONS, ASSESSING QUALITY, THE BALANCED SCORECARD, PERFORMANCE MEASUREMENT IN NON-PROFIT MAKING ORGANISATIONS, EVALUATION & DEVELOPMENT OF PERFORMANCE INDICATORS, Evaluating an existing indicator, Developing a new indicator, EFFECTS OF PERFORMANCE MEASUREMENT ON BEHAVIOUR, SUMMARY OF PERFORMANCE INDICATORS. 

41.08. Scenario planning: SCENARIO PLANNING OR 'WHAT IF?' ANALYSIS, Functional analysis approach to decision making, MAKE OR BUY DECISIONS, Variable costs, Fixed costs, Other issues to consider, LIMITING FACTOR DECISIONS, Dealing with a combination of limitations, Product choice when there are limited resources, BREAK-EVEN ANALYSIS & MARGIN OF SAFETY, Contribution, Break-even point, Margin of safety, Understanding risk, CLOSURE OF A BUSINESSS SEGMENT, MECHANISATION, Redrafting an income statement, USING DISCOUNTED CASH FLOW, Calculating net terminal value or cost, ADJUSTING VOLUMES & PRICES.

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