SMA exam flowcharts and tool finder

Accounting Ahead | Original study resource | accountingahead.com.au

SMA exam flowcharts and tool finder

SMA EXAM REFERENCE PACK | ALL MODULES | PRINT AND KEEP WITH YOUR NOTES

Answering a scenario question

1. Read the task

Verbs: calculate, explain, evaluate,

recommend

2. Find the tool

Which module concept fits?

3. Use the facts

Name the organisation, people and

numbers

4. Calculate

Formula first, then a workings table

5. Interpret

What it means for strategy and value

6. Recommend

Plus risks, qualitative factors and limits

Tool finder

If the question is about... Reach for Module

Industry attractiveness; the wider environment Porter's five forces; PEST and regulation 1

Internal position; where value is created SWOT; value chain analysis 1, 6

A product portfolio Product life cycle; BCG matrix 1

Who needs what information; reporting Stakeholder analysis; integrated reporting (six capitals) 2

Fixing or replacing an information system Modify or replace evaluation; cost-benefit 2

Planning next year's resources Master budget; limiting factor; rolling budgets 3

Explaining actual versus budgeted profit Flexible budget; variance analysis and reconciliation 3

Whether to invest NPV, IRR, PI, payback, sensitivity and scenarios 4

Scheduling a project or catching up Network diagram, critical path, PERT, crashing 4

Whether a project is on budget and time Earned value (CV, SV, CPI, SPI) 4

Measuring strategy execution Balanced scorecard; strategy map; cascading 5

Designing measures and targets SMART; six characteristics; benchmarks; behavioural

effects

5

Distorted product costs Activity-based costing; time-driven ABC 6

Pricing a product Hard and soft functions; surplus value; pricing map;

target costing

6

Cutting costs that stay cut Five questions; ABM and BPM; life cycle and kaizen

costing

6

Choosing suppliers; quality problems; outsourcing Total procurement cost; cost of quality; outsourcing

pyramid

6

Which customers make money Customer profitability analysis; cost to serve map 6

STRATEGIC MANAGEMENT ACCOUNTING | EXAM REFERENCE | ALL MODULES

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Accounting Ahead | Original study resource | accountingahead.com.au

Investment decision

Positive NPV?

At a risk-adjusted rate

Yes

No

Survives sensitivity?

Key variables and

scenarios

Yes

No

Fits the strategy?

Business case,

stakeholders, ethics, risk

Yes

No

Recommend

Then plan, control and

review

Reject, rework or defer

Mutually exclusive with different lives? Compare equivalent annual cash flows

Variance analysis

1. Static budget

The original plan

2. Flexible budget

Budget at actual output

3. Split variances

Sales volume, price,

efficiency, spending

4. Materiality

Size, trend,

controllability

5. Investigate and

act

Causes, links,

responsibility; update

plans

Designing a balanced scorecard

1. Assess

strategy

Vision, mission, key

success factors

2. Assess

stakeholders

Who must be satisfied?

3. Strategy map

Cause-and-effect

between objectives

4. Measures and

targets

Leading and lagging;

SMART

5. Cascade

Units, teams and

individuals

Project life cycle

1. Initiation

Business case, selection,

strategic fit

2. Planning

Scope, Gantt chart, network,

budget, risk

3. Implementation and

control

Earned value, quality, probity,

change

4. Completion and

review

Closure, review, knowledge

STRATEGIC MANAGEMENT ACCOUNTING | EXAM REFERENCE | ALL MODULES

2

Accounting Ahead | Original study resource | accountingahead.com.au

Managing product cost across the life cycle

Design meets target

cost?

Target price less target

profit

Yes

No

Life cycle cost

acceptable?

Design to disposal

Yes

No

Still profitable?

Reviewed during

production

Yes

No

Continue production

Kaizen keeps cutting cost

No at any gate

Redesign the product, decide not to make it, or cease production

Customer profitability map

Protect

Priority service,

sensible incentives

Price for service

Keep price covering

high service

Serve efficiently

Standard, low-touch

service

Change or

charge

Share cost data;

remove discounts;

fees

Low High

Cost to serve

High

Low

Net

margin

STRATEGIC MANAGEMENT ACCOUNTING | EXAM REFERENCE | ALL MODULES

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