- Build upon the material from your Week 4 reflective paper. In doing so, please reflect upon the feedback from your Week 4 PDP. Below are questions/issues that you may again like to further reflect upon:
- What links have you now identified between accounting and finance and effective strategic decision making?
- Further discuss those areas of financial and management accounting, plus financial management, which have most resonated with you.
- How do you see the concepts that you have studied applying to your professional experience, plus your personal finances?
- What steps might you now take to aid you in the transition of applying the coursework to your workplace?
- How can you link what you have studied in Managing Financial Resources with what you took away from your previous modules?
- What ethical and cultural issues have you considered important in this module and how have they impacted upon your views of global business?
- Do you feel that you have improved your ‘key skills’ (report writing, time management, etc.) as a result of your experiences with this module?
Solution
While reflecting on the personal development that I achieved by going through the weekly challenges, I came to realize and understand the difference in my knowledge that has occurred during this period. I have a strong feeling that I am making positive progress as I reflect on my development and the knowledge that I gained during week four to eight. I now can certainly use this newly gained knowledge to apply in my professional career advancement. I have gained profound knowledge during this period in the areas of effective strategic decision making and accounting and finance (Atrill & Eddie, 2016). As I mentioned in my last reflection, I am intrigued by studies which are challenging, and this course did not fail to surprise in this category and was certainly rewarding and challenging at the same time. The course has helped me to expand my knowledge domain regarding financial accounting, financial statement analysis, management accounting, and management of the financial resources and leading to improve the viewpoint for the global business community (Wu et al., 2017).
Before going through these weekly course challenges, I was unable to construct a connection between the effective decision-making process and accounting or finance. All I knew then was that one needs to know the availability of the financial resources before making a decision. It is not entirely wrong, but the domain expands further from this area. I learned that both concepts; financial management and accounting and effective decision making are closely linked. What surprised me was the practical implementation of the accounting information in our daily lives. I learned how important accounting information is in our daily routines (Alkaraan & Northcott, 2006). It is important to understand the financial status and position of any business or household. It can be used for aiding in the understanding of strategic decisions. Any organization needs a strategic decision for its long-term future. These decisions are viable if it is based on proper accounting information. There can be five areas of strategic decision making for business as dependent on the accounting information. These are; the basic strategic decision, manufacturing decisions, long-term investment decisions, human resource decisions and marketing decisions. These are the areas in which strategic decisions are generally needed by every business (Eraut, 2012).
It is known that making managerial decisions and improving organizational performance is a key decision making the task for any organization. Accounting information is crucial for making these decisions. For the achievement of effective organizational performance, it is important to implement fundamental and suitable accounting information needed for and suitable for each organization. Through experience, I get to know that for any long-term decision-making process, financial information is very important for constructing significant, accurate, and effective strategic decisions (Dabrowski, 2017). Any human resource management department needs to have information on the financial aspects to make long-term strategic decisions which are effective as well. Sale and marketing cannot do without the financial and accounting information, they not only need this information for forecasting and planning, but also are the source of accounting information as well, as they provide the information on sales and marketing Financials. By reflecting on this real-life situation information, I came to know that many organizations seem to face problems in using accounting information effectively in their decision-making process (Fahim et al., 2014).
With this course, the comprehension of financial and management accounting improved as well. I have now the ability to discern the concepts of management and financial accounting. The financial accounting is the field which represents the financial health of a company for the analysis and reporting to its external stakeholders like the board of directors, financial institutions, and stockholders. On the other hand, the management accounting is intended for the managers residing internally in the company for aiding them to make decisions for the daily routine operations of the firm. The financial accounting reporting is done quarterly, or annually for the reporting purpose, however, the management accounting is done continuously on a daily basis. The financial accounting gives the picture of the organization and its performance to the outsiders, whereas, the management provides the information for insiders (Milandru, 2017).
The reports of financial accounting are intended to be filed annually and quarterly. These reports are filed publicly, in the case of the public companies. These filings are to be aligned as per the Generally Accepted Accounting Principles also known as the GAAP. The GAAP is based on ten principles, including the cost principle, monetary unit assumption, materiality and conservatism, revenue recognition principle, full disclosure principle, period assumption, going concern assumption, matching principle, and economic entity assumption. These all are individual principles which should be adhered to by the companies while they are developing their financial records. For example, the economic entity assumption is based on the concept that any business activity is to be separated from all the activities of owners and so on so forth (Runtev, 2017).
Another major difference in the management and financial accounting is the time duration for both reporting. The managerial accounting occurs in period opposite to the financial accounting. The financial accounting is dependent on the past performance, whereas the managerial accounting gives the current performance views and also the future trends. Both concepts, therefore, do not provide the same exact figures as these both are based on different time periods. The main understanding of how a manager makes the decision was interesting to me. The situation and its dynamics which a manager faces while making routine decisions for the daily operations of the company were interestingly tough to comprehend. Moreover, a manager has a very short time limit for making these decisions. Most of the operations of the company are thus based on the forecasting and trends assumed and analyzed beforehand. However, such circumstances arise when managers have to deviate from the forecasted models and respond to the current situation for better response. This seems a delicate ordeal (Fahim et al., 2014).
If I can classify the type of knowledge that I have gained from this course, it can be classified into four types of knowledge. The methodological knowledge that is the collection and analysis of data and relevant research, the theoretical knowledge which is based on the theories and concepts the generic skills which are the general skills which I have gained in the form of self-management skills, and interpersonal communication skills, the practical skills which involves the analysis of the hypothetical case studies, and the knowledge regarding my occupation (Azam et al., 2017). After gaining this knowledge, the first step is naturally to use it for implementation in the workplace and own career. It is indeed too difficult to use it in my position as in my current position I do not have the luxury of making significant policy changes and using the knowledge that I have gained through this course. However, I am certain that I can use it to utilize my strengths better. I now have a problem-solving approach towards every activity in the workplace. I certainly will also ensure that my knowledge gets used in the workplace for my company as well. I am trying to organize an induction conference for the staff and am consulting with my supervisor for this seminar. This platform will help me transfer my gained knowledge to the company and new staff. Through the support of the management, I will be able to pass on this knowledge and provide demonstrations and justification of the newly acquired knowledge. It will aid my co-workers and me to cultivate this knowledge in the workplace activities (Kidane, 2012).
By going through the managing financial resources, I realized that it encompasses the other units as well, which I have studied in this module. The study showed that it relates to the accounting, bookkeeping, financial planning, costing, budgeting, strategic management, innovation, marketing management, knowledge management, and creativity. The aspects of the above-listed concepts were comprehended better by going through the managing financial resources. I understood that the concepts of operational performance and financial resources are interlinked (Atrill & Eddie, 2016).
It can be said that the global business and the outlook on it has changed specifically regarding the decision making. The concept of ethical decision making has shaped my global outlook of the business. The priority of balance in choices has enabled me to learn about discarding the bad choices and holding onto the good ones. The adaptation of the three rules of management for decision making in the future, the use of the rule of private gain only if it benefits everyone as compared to the burden has helped. The concept of ethical decision making has cleared my confusion about how decisions for maximization of the profits have to be for the benefit of the environment and all the stakeholders. The concepts do not make the decision making easier indeed. However, it is essential to adopt ethics in decision making as it has never benefited for having gains based on the burdens of others. I previously had the viewpoint that the companies main aim of maximizing shareholder value through the maximization of the profits does not depend on any other restrictions. However, it has become clear to me that this is not certainly the situation (Wu et al., 2017).
Reflecting on the strengths and weaknesses regarding the knowledge and skills gained through this module can be translated by saying that most of my weaknesses have converted into strengths. The improvement that I have seen in my prior problem areas like time management, report writing, and interpersonal skills is an important step forward. Furthermore, the improvement shown in the critical thinking skills and report writing is most evident as these were the areas which I most lacked in previously. It shows that I have dominantly learned more than what I signed up. It does not only give me theoretical knowledge but also helped me shape my experience as well. The increasing amount of interest of stakeholders in the ethical implications of the business and its decisions has also led to increasing the adaptation of the ethical decision making and ethical strategies more. The companies thus intend to incorporate ethical aspects of its decisions as well (Fahim et al., 2014).
Concluding, it can be said that I enjoyed my experience and took full advantage of the challenges pushed towards me. The sharpening of the financial management skills has widened my domain knowledge and my appreciation for all the patience and help extended towards me should not go unnoticed. I not only learned new concepts, but this module also helped me in unlearning the wrong concepts.
References:
Alkaraan, F. & Northcott, D., 2006. Strategic Capital Investment Decision-Making: A role for emergent analysis tools. The British Accounting Review, 38(2), pp.149-73.
Atrill, P. & Eddie, M., 2016. Accounting & Finance for Non-Specialists. 10th ed. Pearson Learning Solutions.
Azam, A., Boari, C. & Bertolotti, F., 2017. Top management team international experience and strategic decision-making. Multinational Business Review, 26(1), pp.50-70.
Dabrowski, J., 2017. Towards an Adaptive Framework for Goal-Oriented Strategic Decision-Making. 2017 IEEE 25th International Requirements Engineering Conference, pp.538-43.
Eraut, M., 2012. 2.1 Transfer of knowledge between education and workplace settings. In H. Daniels, H. Lauder & J. Porter, eds. Knowledge, values and educational policy: A Critical Perspective. Routledge. pp.65-84.
Fahim, S.T., Khonadakar, J.A. & Ullah, H., 2014. Role of Accounting Information in Strategic Decision Making in Manufacturing Industries in Bangladesh. Global Journal of Management And Business Research, 14(1), pp.1-15.
Kidane, F., 2012. Decision Making and the Role of Management Accounting Function–a Review of Empirical Literature. Radix International Journal of Banking, Finance and Accounting, 1(4), pp.77-97.
Milandru, M., 2017. Reflections On the Role of Economic and Financial Management. Buletin Stiintific, 22(2), pp.91-96.
Runtev, M., 2017. New Trends and Features of International Financial Management. Economic Development, 19(3), pp.249-61.
Wu, Y. et al., 2017. Top Management Teams’ Characteristics and Strategic Decision-Making: A Mediation of Risk Perceptions and Mental Models. Sustainability, 9(12), p.15.
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