bab 9

MANAGEMENT PLANNING AND CONTROL

FOUR DIMENSIONS IN MAKING BUSINESS MODEL

Determination of the business model of the big picture, and consists of the implementation, formulation and evaluation of long-term business plan that includes four dimensions of the game are:

• Identify key factors that are relevant to the company’s progress in the future.
• Formulate appropriate techniques to predict future developments and analyze the company’s ability to adapt or take advantage of this development.
• Develop data sources for the selection of strategic support.
• certain options translated into a series of specific actions.

STANDARD COST DIFFERENCE CONCEPT AND KAIZEN

Determine the standard cost system tries to minimize the variance between budget costs with actual costs. Kaizen Costing stressed to do what is Necessary to Achieve the desired level of performance in a competitive market conditions.

Standard cost concepts:

• Control costs
• Applied to the condition of existing manufacturing
• Purpose: compliance with performance standards
• Standards are determined each year
• Analysis of variance based on actual vs. standard
• Investigate if the standards are not met

The concept of Kaizen Cost:

• Reduction of costs
• Applied to continuous improvement in manufacturing
• purpose: Achieve cost reduction target
• Target cost reduction is determined each month
• Analysis of variance based on constant cost reduction
• Investigate if the target does not cost Achieved

FOREIGN INVESTMENT EXPECTED RETURN

The decision to invest abroad is a very important element in global strategies of multinational corporations. Foreign direct investment involves a large number of general capital and uncertain prospects. Investment risk, followed by an unfamiliar environment, complex and constantly changing. Generally, a formal planning necessity and carried out within the framework of capital budgeting that compares the benefits and costs of the proposed investment.
In the international environment, investment planning is not as simple as that. Differences in tax law, accounting systems, the rate of inflation, the risk of nationalization, currency framework, market segmentation, transfer restrictions retained earnings, and differences in language and culture add to the complexity of the Elements That rarely found in domestic environments. The difficulty for the quantification of these data make-existing problem worse.

CALCULATION OF THE MULTINATIONAL COMPANY CAPITAL COSTS

If foreign investment is evaluated by using a discounted cash flow models, the appropriate discount rate should be developed. The theory of capital budgeting in particular using the cost of capital as the discount rate, Thus Spake the project should generate a profit at least equal to the cost of capital in order to be accepted. The level of the benchmark (hurdle rate) associated with the proportion of debt and equity in the company’s financial structure as follows.
It is not easy to measure the cost of multinational capital. The cost of equity capital can be calculated several ways. One popular method of combining the expectation was the return of dividends by the dividend growth rate expectations. Assuming the per share dividend = estimate at the end of the period. Po = price of the stock market is now at the beginning of the period and g = expected growth rate in dividends, the cost of equity, should be calculated as follows for = many At / Po + g. Although the capital is to measure the stock price is, in most countries where the multinational company’s shares are listed, is often quite difficult to measure in a and g. Since the first expectation. Dividends are expected to depend on the company’s operating cash flow as a whole. Measure of cash flow is complicated by the consideration of environmental factors. Besides the measurement of the dividend growth rate is a function of expectations of future cash flows are complicated by exchange controls and other government restrictions on cross-border transfer of funds.

PROBLEMS IN DESIGNING AND CONTROL SYSTEM HASSLE FINANCIAL INFORMATION AND MULTINATIONAL COMPANIES

Clear distance is a hassle. Caused by geography, formal information communication generally replace the personal contact between the local operations manager with office management.
Three global information technology strategy, each of which is associated with certain types of multinational organizations. Achieved success depends on the suitability of the design of systems with corporate strategy:

• deployment of low to high centralization. Used by smaller organizations with limited international business operations and information systems need to dominate the domestic
• high-low spread of centralization. Local subsidiary is given a significant influence on the development of strategies relating to technology and information systems Himself.
• high with spread of high centralization. Following the global information technology strategy execution locally by global companies with strategic alliances throughout the world. Information system is designed to reflect the needs of the company adapted to local conditions.

Management Accountant to prepare some information for the management of companies, ranging from data collection to reporting estimates of different types of liquidity and operational expenditure. For each group of data submitted by the company management should determine the relevant time period for the report, the level of accuracy required, the frequency of reporting and the costs and benefits of depreciation and timely delivery. Here also the environmental factors that influence the use of information generated translation. Reports from overseas operations of multinational companies are generally translated into U.S. dollar equivalent value of the manager’s office in the U.S. to evaluate their investment in dollars.

VARIANCE ANALYSIS OF EXCHANGE RATE

Three exchange rate to use when Preparing the draft operating budget at the beginning of the period:

• exchanges where the exchange rate when the budget prepared
• the exchange rate expected to apply at the end of budget period (projection level)
• the exchange rate at the end of the period when the budget be adjusted if changes in the exchange rate (closing rate)

SPECIAL DIFFICULTIES IN IMPLEMENTING THE SYSTEM DESIGN AND PERFORMANCE EVALUATION OF MULTINATIONAL COMPANIES

Evaluation of performance on certain multinational companies are classified into three levels Essentially, that is

• Levels of Leadership (Director and above)
• Supervisors and above
• Employees are low (blue)

In the evaluation of the directors to the top, the assessment is directed “leadership framework” which includes 13 behaviors were classified into 4 groups:

• Inspires people consisting of:

1. Leading people. Is the ability of civil servants and make them confident in doing something so That They could create the appearance was consistent with the principles of management and leadership with the translation as follows: Related to keep all relevant information and community, increase effectiveness of work teams and team principal to success.
2. Develop people. Is to help employees to identify needs for the successful development needs, encourage employees to learn to provide suitable support. With the translation as follows: Provide a detailed command ensures that the command was understood and Cleary look and create a positive environment for long-term development.
3. Practice what you Preach. Is it to be consistent with the principles and values ​​Realizing, including “the passage of communication” even in difficult times.

• Opening up, consisting of:

1. Knowing yourself. Is the ability to precisely identify and understand the power of yourself and fix it as well as applied and implemented in effect, order was understood in a person’s effectiveness in the organization. And has an extensive self-care and deep. Act as a constant (stable) on the influence of their power to correct and compensate for weaknesses.
2. Insight. Is the ability to identify relationships between facts, ideas and the situation was not clear and collecting it to solve problems that require priority, clarify and explain the complex situation that has been given / created opportunity.
3. Courage. Associated with the capacity and confidence of employees in their opinion, and allowed to make decisions or choices, along with concerns Evaluating the risks and responsibilities in dealing with critical situations and challenges.
4. Curiosity. An employee openly curiosity to learn more about the environment by asking questions to think or do research It appears simple, broad and constant.
5. Service orientation. Is the desire to help or serve the customer with an understanding of customer expectations and needs, providing quality services that are long lasting and mutually beneficial as well as a long-term perspective on the merits.

• Calls with the Other, which consists of:

1. Proactive collaboration. Whether working with others through a commitment to Achieve the object, understand and target the needs of others and adapting own views and the views, if appropriate behavior through personal contribution to effective teamwork.
2. Impact: Reassure and Others. Is convinced, directly or indirectly to obtain commitment to the project idea or action that the Organization of interest through the use of a lot of convincing arguments, generate interest in others by using the influence of an integrated strategy.

• Adding value, comprising:

1. The results of the focus. Ambition is to meet the target performance / quality standards and work continuously to Obtain Suitable methods of process improvement, motivation to Achieve the target to increase employment and maximize employment in the long run.
2. Initiative. Make the employee is to act proactively (to act and think in simple terms) so that the initiative was not just reacted to the situation, but also anticipating for a long time and do it well.
3. Innovation / Renovation. Display behavior to receive the ‘status quo’ challenges in improving the control and new ideas so that there is a change up and running efficiently.

HOW TO FIGHT INFLATION AND THE EFFECT ON FLUCTUATIONS  MULTINATIONAL CORPORATE PERFORMANCE MEASUREMENT

For multinational companies, foreign currency fluctuation level of uncertainty resulting from the company’s operations in the international arena. Eye risk management refers to enterprise risk management transactions, economic, and translation. Transaction risk refers to the likelihood that cash transactions in the future will be influenced by changes in exchange rates. Economic risk refers to the possibility that the present value of cash flow company in the future will be influenced by exchange rate fluctuations. One way to overcome problems of economic risk and the risk of the transaction is to hedge (hedging). Swap contracts require the buyer before a certain currency with a certain exchange rate (forward rate) at a predetermined date in the future. In the face translational risk, management can give a report in dollar-denominated and local multinational management can know the true state of the local divisions and the impact of foreign currency translation. Multinational companies use a system of decentralized Because It Gives advantage to the country of origin and distribution of foreign divisions. These advantages include:

• Local Manager Able to Produce better decisions through the use of local information.
• Local managers can provide more timely responses to changing circumstances.
• Manager of the center is not possible to understand all of products and markets.
• Train and motivate local managers to make decisions daily operations so that top management can focus was more on long-term problems.

Performance measurement in multinational companies should separate the evaluation of a division manager with evaluation of this division. Managers should be evaluated based on revenue and costs incurred. Once the manager is evaluated, a subsidiary of the financial statements can be tailored to the parent company’s currency and the cost can be allocated beyond the control of managers. Environmental factors such as social culture, economic, political, legal, and differ in one country from another country is out of control, but managers will affect company profits and ROI.

source :

http://wartawarga.gunadarma.ac.id/2012/04/eva-lestari-21208448-4eb11-tugas-softskill-akuntansi-internasional-bab-9/