MANAGEMENT ACCOUNTINGS - VARIANCE ANALYSIS I. Variance have been worked out from the information given in the earlier hub. Important variances are discussed as under: Both Price and Quantity Variances were favorable which had a good impact on operation of the company. It not only shows good market conditions but also acceptance of the company's products as it could sold much more than its monthly budget or quota.
Though the company is purchasing the term 'price' rather than 'cost' is being used for convenience. This is an accepted practice. The price variance was adverse while usage variance was favorable. Was price variance avoidable? We would advise the owner to study the trend and either buy in bulk or enter into a supply contract or make arrangement with suppliers for Just-in-Time inventory. Since raw material constitutes nearly 80% of total cost, the price variance was the main reason for the losses sustained by the company in July 09.
Free SAP server access.. Annual leave - Payment for other holidays and leave. For public holidays, alternative holidays, sick leave and bereavement leave an employee is entitled to be paid either their relevant daily pay or average daily pay. ‘Relevant daily pay’ Relevant daily pay is used to calculate payment for public holidays, alternative holidays, sick leave and bereavement leave. Relevant daily pay is the amount the employee would otherwise have earned on the day if they had worked, and includes: productivity or incentive payments, including commission or piece rates, if those payments would have been received had the employee worked overtime payments the cash value of board and lodgings provided. However, it excludes payment of any employer contribution to a superannuation scheme for the benefit of the employee. ‘Average daily pay’ Average daily pay is a daily average of the employee’s gross earnings over the past 52 weeks. Relevant daily pay or average daily pay?
“Penal rate” Examples include: a Saturday payment a Sunday payment a public holiday payment. Holidays and leave. The Holidays Act 2003 helps to promote balance between work and other aspects of employees’ lives. It was amended by the Holidays (Transfer of Public Holidays) Amendment Act 2008 and the Holidays Amendment Act 2010. This guide includes those changes. The Holidays Act 2003 provides minimum legal entitlements to: We discuss holiday and leave entitlements and how to calculate payments correctly. If you need more information about any matter, please contact the Department of Labour or freephone 0800 20 90 20. More information about the changes to the laws on employment relations and holidays from the 2010 Amendment Acts can be found in “Changes to laws on employment relations and holidays”. Principles underpinning the Holidays Act New Zealand law on holidays and leave has been based on three key concepts: For the purposes of rest and recreation, all employees are entitled to enjoy four weeks’ paid annual holidays (or “annual leave”) each year.
Payment for other holidays and leave. Accounting Principles I: Special Journals. Trust Fund Accounting Do’s and Don’ts. A large percentage of disbarments and disciplinary actions arise out of client trust fund mismanagement. With the key concepts of trust accounting in mind and a few practical tips that you can put into practice immediately, you’ll be in compliance and be prepared even for a random audit. Which Funds Belong in Client Trust Accounts? In general, deposit only these client funds into a trust account: Personal injury settlements Other settlements or judgments Collections Retainers and advances for fees until actually earned Which funds do not belong in a trust account? Earned fees when the client pays Personal funds Operating or other business funds Remember, any funds for which you have fiduciary responsibility should always be held in separate properly entitled accounts.
All Client Funds Must Be Kept Separate "Client A’s" money has nothing to do with "Client B’s" money. Your Client Ledger Must Never Have a Negative Balance Verify Funds before Disbursement Match your Books with Bank Statements. Death by Variance Analysis. Death by Variance Analysis This coming Tuesday the Corporate Services Committee will be reviewing about 20 pages of variance analysis that is to a major extent, quite useless. No wonder our Town Councilors tend to have that deer in the headlights look whenever finances are discussed and believe that a $4M deficit is not real.
The problem with the variance analysis is that they continue to compare apples to oranges. They compare the actual amounts up to June 30 to the budget amounts...useless as this ignores seasonality and does nothing to compare June 30, 2012 to June 2011, 2011. There is a glimmer of useful information in that they have a ‘forecast’ for the year but once again they screw up the analysis by comparing the forecast to the June actuals. Just to help effect positive change I would suggest the following. The second thing that I suggest is there needs to be a variance analysis of actual results to prior year actual results for the same time period.
Construction accounting. TAX. Finance. IFRS.