Research Journal Of Finance And Accounting â€Myassignmenthelp.Com

Question: Discuss About The Research Journal Of Finance And Accounting? Answer: Introducation In the 21st century, management accounting practices in Australia shifted from creating value for customers and shareholders and organizational innovation to creation of value for stakeholder, management of risks and sustainability reporting. There are multiple risks which are involved in the business processes of a company. Risk can pose serious threats to the resources of practices. Unlike early 1980s and 1990s management accounting practices in Australia focused on risk management by either minimizing the risk or eliminating risks. Management accounting practices in Australia aim to create value for stakeholders by shifting focus from profitability during a shorter span of time to aiming to accomplish prosperity in the long run. Management accounting practices in Australia do not focus only on creating profit for shareholders but also focuses on corporate governance and corporate social responsibility so that firms can return value to stakeholders of business and thus can achieve long term sustainability. Management accounting practices have introduced models like Stakeholder Value Model (STV) and Corporate Social Responsibility (CSR) models in Australia. Organizations and firms are no more viewed as microscopic organizations in Australia with the advent of globalization and management accounting practices have changed from 1990s and 2000 and have adopted a contemporary approach (Birt et al., 2014). Discussion In early 1980s and 1990s management accounting practices ignored the consequences that business have on society and environment. Social accounting practices have emerged in Australia and firms no longer focus on only economic performance (Cantrell, Kyriazis Noble, 2015). Management accountants must provide information on development of stakeholders. Thus in Australia, management accounting practices has incorporated Stakeholder Value Model where appropriate management practices and strategies are followed and there is core commitment to humanistic values in organization. A flexible and supportive organization structure and an open model of communication help management accounting practices to create value for stakeholders in AustraliaThe economic approach of corporate governance focuses on enhancing the competitive position of the firm which helps manager to achieve short term success. However the implementation of the STV model in management accounting practices focuses on both per formance which is good financially and enhances the commitment of an enterprise towards fair accounting practices and equity (Tucker Schaltegger, 2016). The firms in Australia incorporates STV model in accounting practices by identifying its primary stakeholders and addressing their issues and concerns immediately, secondary stakeholders are addressed ethically. In modern days management accounting practices in firms in Australia focuses on allocating resources efficiently and achieves better control by providing information about society and environment (Kang Gray, 2013).. The accounting system in Australia focuses on Sustainability accounting practices in modern days. Sustainability reporting comprises of multiple arenas like non-financial reporting, corporate social responsibility, environmental and social accounting practices. Sustainability report provides information about integrated report which reveals how value is created by a firm on short, medium and long term. The information about sustainability is disclosed to public by Australian firms. Thus analysts and investors in Australia focus on long-term performance of a firm and addresses sustainability issues like greenhouse gas emission and corporate responsibility (Higgins, Milne Van Gramberg, 2015). Reports of sustainability are jointly formed by members of Boards of Australian firms and investment analysts. Earlier only public companies in Australia focused on sustainability reporting but in modern days sustainability reports are also prepared and disclosed by private enterprises in Austral ia. Global Reporting Initiative (GRI) helps in comparing the sustainability reports of companies belonging to a specific industry in Australia. Climate change plays a vital role in sustainability reporting in Australia. Companies ensure to be neutral to carbon and focus on development of products which are less carbon intensive. The investment value of a firm is impacted by this sustainability report. Top 100 public companies in Australia have 48 % sustainability reporting and 47% sustainability reporting is provided by top 100 private companies in Australia. The trend on publishing stand-alone sustainability reports is popular among companies in Australia which is separate from the annual reports of the company (Bachoo, Tan Wilson, 2013). The regulations of accounting systems in Australia manage risk faced by organizations by providing reliable and timely information. The accounting practices have become technical and complicated. A risk management framework is adopted by Australian firms in modern days for effective control and mitigation of risks faced by business processes of Australian enterprises. Key organization risks can be risk of governance, risk of business continuity and risk in succession planning, risks imposed by stakeholders and technology and other financial risks. Risks can also be imposed to firms in Australia by regulatory changes and human resources and the system of operation of firms. The accounting practices to handle risks hugely depend on the size and the practices of operation followed by an Australian firm. It is of paramount importance to monitor the policies and practices of risk management of an enterprise to align the risk management process with the accounting practices of an enterpris e in Australia The Risk Management Framework will have direct impact on the partners of a firm. The system of leadership and clear communication of risk management process across all levels in an organization helps firms in Australia to manage, eliminate and mitigate risks effectively (Chung Hensher, 2015). The Risk Management framework of a firm is reviewed regularly, at least annually by business leaders in Australia. Proper documentation of the risk management process is also important so that the policies and procedures of risk management can be clearly communicated to the personnel of a firm (Wadeson Ciccotosto, 2013). The effective management of risks by accounting practices in Australia helps in maintaining the reputation of a firm. Blind spots and deficiencies can be identified better by an organization if Risk Management Framework is effectively implemented and integrated with the accounting practices in Australia (Brown, Steen Foreman, 2009). Changes In Focus Of Management Accounting Function The management accounting function has changed focus. Organizational innovation, economic profitability, creating value for shareholders and stakeholders were the prime focus of management accounting firms in 1980 and 1990s.The principle of accounting practices by firms in Australia was greatly influenced by Great Britain in earlier days and there was absence of a single professional institution also desired results of accounting practices were not achieved by firms of Australia because of absence of co-operation among accounting bodies in Australia that existed in earlier days(Considine et al. , 2012). In twentieth century, management accountants were involved in managerial decision making, they were show the big picture of the firm and were involved in decision making process of the organization. Management accountants also had a holistic approach towards an organization, they demonstrated complete understanding of the requirements of an organization and also helped managers to achieve competitive advantage. In the second part of twentieth century there were two major professional bodies which handled accounting practices of enterprises in Australia. These two professional bodies were Institute of Chartered Accountants in Australia (ICAA) and CPA Australia. The Australian Accounting Research Foundation (AARF) promoted research in accounting in Australia with the medium of Accounting Standard Boards (AcSB). In earlier days there was implementation in promoting accounting practices as each state in Australia had its own company law. The Accounting Standard Review Board (ASRB) was fo rmed in Australia in the year 1984 which was responsible to review accounting standards. However this board did not continue for long and was replaced by Australian Accounting Standards Board (AASB) in the year 1989. In the year 1990s, huge pressure was imposed by boards like Australian Stock Exchange to align accounting practices in Australia to the accounting practices followed internationally. This was a result of economic globalization. In modern days accounting standards in Australia are determined by the International Accounting Standards Board ( IASB). Thus it can be clearly stated that accounting has achieved a strong position in the 21st century in economic framework of Australia. Urgent Issues Group was created in Australia which provided a quick and prompt solution to difficulties of accounting practices which was a result of difference in opinion of accounting standards (Henderson et al., 2014). Thus it can be clearly understood how the accounting practices in Australia has changed from 1980s to 2000 to the 21st century. The accounting firms in Australia focus towards creating value for both primary and secondary stakeholders, both public and private organizations in Australia publish sustainability reports which addresses issues like climate change and other environmental issues and management accounting practices also focus on management of risks. It can be clearly understood that focus of Australian accounting practices shifted from just a good economic performance of the firm and firms introduced on non-financial performance by adopting approaches like Stakeholder Value Model and focusing on corporate governance and corporate social responsibility. In order to gain prosperity for business on a long term perspective, management accountants have shifted focus from creating value for shareholders and customers to create value for all stakeholders of business. In Australia, both public and private enterprises focus on accounting practices on environmental accounting and have shifted focus to sustainability and corporate social responsibility (Horngren, 2013). Disclosure reports are published by company on opportunities for equal employment, safety of work environment, product and industry and aim to provide better working conditions for employees. Accounting systems of public and private enterprises in Australia provide data related to these topics so that reports of disclosure can be published by companies. Contemporary accounting practices in Australia focuses on four major arenas which include growth and learning, internal business process, performance related to finance and customers. On modern days companies perform Strategic audits which are quite different from audits which are financial in nature. In strategic audits, all strategic functions of a firm are reviewed. Value based reporting are adopted by many public enterprises in Australia which focuses on social governance, issues related to environment, framework of empowerment and economics. Thus there is sustainable change in focus of management accounting functions in Australia (Hoggett, 2012). Practical Examples From Annual Reports Of Companies Currently Operating In Australi The change in focus of management accounting functions can be clearly seen from the annual report of National Australia Bank Limited. The primary stakeholders of the bank are customers, community, suppliers, employees and shareholders. The firm has adopted an ESG framework while publishing its annual report in the year 2016. The ESG framework comprises of themes related to environment, society and governance. Surveys from primary stakeholders of the bank are conducted every year and feedback from stakeholders like employees and community members are taken. The bank also creates a supporting work environment for his stakeholders (National Australian Bank, 2017) From the annual report of Wesfarmers it is clearly evident that the company focuses on creating value for stakeholder and publishes sustainability report. The company focuses on risk management which includes operational risks, risks related to strategy, financial risks and regulatory risks. Though the company focuses on creating value for shareholders but issues related to people and sourcing networks of the company, issues related to environment and governance are also addressed by the firm as evident from its annual report published in the year 2016(WESFARMERS, 2017) It is also evident from the annual report of Coles that the company focuses on risk management. The focus is on mitigation of risks on supply chain of fuel, risks related to retention of employees. The leading supermarket in Australia focuses on creating value for all its primary stakeholders which include customers who can avail fresh stocks from Coles at lower prices. Coles also focuses on environmental issues and creates value for all its suppliers. Sustainability reports are published by the company and all management accounting practices have shifted from just mere profitability and financial performance (Coles, 2017) Conclusion It can be concluded that, in the global world, the accounting system of Australia has demonstrated major changes. Companies focus on long term profit and thus focus of management accountants have shifted from creating value for shareholders and customers to sustainability reports, creation of value for stakeholders which include both primary and secondary stakeholders and risk management. It is evident from the annual reports of existing companies of Australia published in the year 2016 like National Australia Bank, Wesfarmers and Coles that the companies mange risks effectively and publishes sustainability reports, addresses concern for environment, CSR and creates vale for stakeholders. References Bachoo, K., Tan, R., Wilson, M. (2013). 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