final business stratagy

8/11/2019 Final Business Stratagy

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BUSINESS STRATAGIES AND MANAGEMENT CONTROL TO MEASURE SUCCESS

1

PADMASHREE ANNASAHEB JADHAV BHARATIYA SAMAJ UNNATI MANDALS

B.N.N. COLLEGE, BHIWANDI

DIST. THANE 421 305

UNIERSITY OF MUMBAI

A PROJECT ON

BUSINESS STRATAGY AND

MANAGEMENT CONTROL TO

MEASURE SUCCESSSUBMITTED BY

NEELAM EKNATH PATIL

ROLL NO. 120

IN PARTIAL FULFILMENT OF

THE REQUIRMENT FOR

THE AWARD OF THE DEGREE OF

M.COM IN MANAGEMENT

UNIVERSITY OF MUMBAI

UNDER GUIDENCE OF

PROF.AMEERUL HASAN


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PADMASHREE ANNASAHEB JADHAV BHARATIYA SAMAJ UNNATI MANDALS

B.N.N. COLLEGE, BHIWANDI

DIST. THANE 421 305

CERTIFICATE

This is to certify that, NEELAM EKNATH PATIL.ROLL NO.120 of

M.COM IN MANAGEMENT (Academic Year 2013-2014) has

successfully completed the project on BUSINESS STRATAGY

AND MANAGEMENT CONTROL TO MEASURE SUCCESS

and submitted the project report in partial fulfillment of the

requirement for the award of the M.COM(MANAGEMENT)

students of University of Mumbai.

Signature

I/C Principal Prof. U.D.KADAM

Course Co-coordinators Prof. Suwarna Rawal

Project Guide Prof.AMEERUL HASAN

External Examiner


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ACKNOWLEDGEMENT

I,MISS PATIL NEELAM (Roll No. 120)of MASTER OF COMMERCE,

studying in B.N.N COLLEGE, Bhiwandi, hereby that declare that the

information contained in the project titledBUSINESS STRATAGY AND

MANAGEMENT CONTROL TO MEASUR SUCCESS is true and

correct to the best of my knowledge & belief.

( NEELAM PATIL)


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DECLARATION

I am indebted to my project guide Prof. SHAH AMEERUL

HASAN for helping me out in the successful completion of my project report

,on BUSINESS STRATAGY AND MANAGEMENT CONTROL TO

MEASURE SUCCESS I am thankful to my other teacher for providing me

the information as and when required.

I am extremely thankful to my family members for their constant

support.

Last, but not least, came my friends who discussed with me the

various issues in my project finally; I want to thank one and all who helped me

directly or indirectly through the project work.

(NEELAM PATIL)


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INDEXSR.NO TOPIC NAME PAGE NO.

1 INTRODUCTION OF BUSINESS

STRATAGY

6-8

2 BUSINESS STRATEGIC

ANALYSIS

9-11

3 BUSINESS STRATAGY MODEL

BUSINESS STRATAGY

TECHNIQUES

I.

SWOTII. 5&6 FORCES

III. PEST

IV. PESTEL

V. MOST

VI. DBONOS 6 THINKING

HATS

12-14

15-24

4 CRITICAL SUCCESS FACTOR 25-27

5 RESEARCH METHODOLOGY

OBJECTIVES OF STUDY

SOURCES OF DATA

LIMITATIONS OF STUDY

28-29

6 GUIDE TO INTERNAL

CONTROL-

(CAMPES PHILOSOPHY ON

FISCAL MANAGEMENT)

31

7 COMPONENTS OF INTERNAL

CONTROL

32-43

8 ROLE OF INTERNAL AUDIT 44

9 CONCLUSION 45

10 REFERENCE 46


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PROJECT ON

BUSINESS STRATAGIES AND MANAGEMENT

CONTROL TO MEASURE SUCCESS


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INTRODUCTION OF BUSINESS STRATEGY

MEANING OF STRATEGY

Author:Jim Riley Last updated: Sunday 23 September, 2012

Overall Definition:

Johnson and Scholes (Exploring Corporate Strategy) define strategy as follows:

"Strategy is the direction and scopeof an organization over the long-

term:which achieves advantage for the organization through its configuration

of resourceswithin a challenging environment, to meet the needs

of marketsand to fulfill stakeholderexpectations".

In other words, strategy is about:

* Where is the business trying to get to in the long-term (direction)

* Which markets should a business compete in and what kind of activities are

involved in such markets? (markets; scope)

* How can the business perform better than the competition in those markets? (

advantage )?

* What resources (skills, assets, finance, relationships, technical competence,

facilities are required in order to be able to compete? (resources )?

* What external, environmental factors affect the businesses' ability to compete?

(environment)?

* What are the values and expectations of those who have power in and around

the business? (stakeholders)
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STRATEGY AT DIFFERENT LEVELS OF A BUSINESS

STRATEGY

Strategy is also a hierarchical conceptit takes place at three different

levels: corporate, business, and functional. These levels correspond with theactivities of managers in different parts of the organization.

o Corporate strategy is the set of explicit or implicit decision rules

that determines what business(es) a firm will be in and not be in,

and how it will allocate resources among them.

o

Business strategy is how a firm develops and sustains acompetitive advantage within an industry.

o Functional strategy is the set of decisions made in marketing,

operations, finance, research and development, and human

resources that supports the business strategy.


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Corporate Strategy- Corporate strategy, typically located at

headquarters, determines which industries the firm will compete in and which

ones it will exit.

Business Strategy. Business strategy, typically located at the business

unit or division level, determines how a company will compete within a given

industry.

Functional Strategy. Functional strategies are typically the responsibility of

the heads (often vice presidents) of the various functions within a product

division or business unit.

BUSINESS STRATEGY ANALYSIS

To many managers, and most strategic planners, the idea of thinking about

and influencing the futures of their firms is an exciting one. Most managers are

eager to set corporate goals and then to start formulating strategies that will help

achieve those goals. However, two fundamental problems are inherent in

approaching the strategic management task this way. First, most businesses are

ongoing concerns and have set in motion certain activities that are a reflection

of decisions made in the past. To think about the future without a thorough

understanding of what is actually taking place may lead managers to formulate

strategies that are either unrealistic or impossible to implement. Second,

managers sometimes are tempted to engage in a strategic redirection of their

firms without a thorough understanding of the healthyparts of their existing

strategy. This tendency to throw the baby out with the bathwater can be

thwarted only by making sure that management thoroughly understands the

basis and the results of its present strategy.

All firms have a realized strategy, whether or not management has made

that strategy explicit in advance. As we have seen, a firms actual strategy can


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be quite different from what management thinks it is or from what it was

intended to be. The process of delineating the realized strategy is

called strategy identification.

This section will describe how to identify a business strategy. After this

identification process is complete, then a manager can assess the quality of that

strategy in order to ascertain which aspects of strategy might be candidates for

change and which are certain candidates for retention. (Note that a perfectly

acceptable outcome is for management to conclude that no changes are

necessary. This process then results in validating an already sound strategy.)

IDENTIFYING YOUR FIRMS BUSINESS STRATEGY

Strategy identification at the business level is a straightforward process. In

essence, a business strategy is built on a set of functional strategies, representing

the competitive weapons that a company employs to compete in a given

industry. The way to identify a business strategy is simply to first go through

each of the functional areas and identify what pattern of decisions have been

made in each, as follows.

Marketing Strategy. Marketing strategy consulting firms price their

services at a multiple closer to five times the consultants hourly salary rate.

Therefore, Sigma would be considered a standard-rate price, whereas some of

the specialized strategy consultants would be considered premium-rate

consulting firms.

Operations Strategy. Here, management should consider the question of

how it transforms inputs into outputs for the marketplace. For example, what

kinds of facilities does the company use? Are they concentrated in one location,

or are they dispersed over a broader area? What is the companys capacity

strategy.


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Financial Strategy. Although many firms are fairly explicit about the

marketing and production strategies that they follow, some of these same firms

are vague when it comes to articulating their financial strategies.

Research-and-Development Strategy. Firms vary considerably in the ex-

tent to which they include research and development as a salient component of

their business strategies.

Human Resources Strategy. The types of people hired to operate a company

is not only a reflection of the other functional strategies, but they also determine

what kinds of future strategies can be pursued. Why? Because the human assets

represent the capability set of the firm.

EVALUATING YOUR FIRMS BUSINESS STRATEGY

Disciplining oneself to go through the strategy evaluation process is

important because only after gaining a thorough understanding of the strategys

quality can one know what elements of strategy should be changed and, equally

important, which elements of strategy are sound and should not be altered. In

addition, the evaluation process itself will suggest strategic alternatives.

The complexity of a corporation defies its being evaluated in any single

dimension. As any security analyst knows, the quality of a companys stock

must be judged on more than the historical performance of the firm; equallyimportant are the firms plan for the future, the quality of its internal resources,

and its management.


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BUSINESS STRATAGY

A Definition of Business Strategy

The definition of business strategy is a long term plan of action designed to

achieve a particular goal or set ofgoals or objectives.

Strategy is management's game plan for strengthening the performance of the

enterprise.

It states how business should be conduct to achieve the desired goals. Without a

strategy management has no roadmap to guide them.

Creating a business strategy is a core management function .It must be said that

having a good strategy and executing the strategy well, does not guarantee

success. Organizations can face unforeseen circumstances and adverse

conditions through no fault of their own.

The strategy needs to be frequently reviewed against prevailing

external and internal environment (SWOT analysis ).This is wherebusiness
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intelligence comes in where you need to constantly monitor how the strategy

and the objectives are being executed.

Business (or Strategic) management is the art, science, and craft offormulating, implementing and evaluating cross-functional decisions that will

enable an organization to achieve its long-term objectives. It is the process of

specifying the organization's mission, vision and objectives, developing policies

and plans, often in terms of projects and programs, which are designed to

achieve these objectives, and then allocating resources to implement the policies

and plans, projects and programs. Strategic management seeks to coordinate and

integrate the activities of the various functional areas of a business in order to

achieve long-term organizational objectives. A balanced scorecard is often used

to evaluate the overall performance of the business and its progress towards

objectives.

The Business Architecture Model

Business Architecture Model. Where a framework is a higher level

basic conceptual structure of related things, the model is a pattern of things that

can be repeated to achieve a desired result. In other words, the model simply

represents an actionable approach, or pattern, for delivering on the conceptual

framework.
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BUSINESS STRATAGY TECHNIQUES

While operating at business level to get success in business

operations businessman have to adopt business strategies. There are many

business strategies some of them discussed below,

I. SWOT ANALYSIS

Strengths:What are the productstrengths that differentiate it from the

competition? What organizational strengths do we bring to the table?

Weaknesses:Where are features lacking or underdeveloped? Are there

alliances or organizational weaknesses that erode market share?


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Opportunities:Where can we differentiate the product? What strategies can we

put in place to gain greater market share?

Threats:How could this product fail? What factors in the market or the

roadmap can bring it to obsolescence or lose market share?

In my opinion, SWOT tends to primarily focus on your product and the

competitors around it. This framework is a bit too close when looking purely at

how an organization can meet objectives set for a product and narrow when

looking only at your product vs. the competition. Often market research is

sought in determining the objectives themselves, and this is where it can be

limited. Often the organization looks to the product to set the objectives of the

productor at least recommend them. SWOT will not help you set the product

objectives because it assumes they have already been set.

Example SWOT Analysis,

A start-up small consultancy business might draw up the following SWOT

Analysis:

Strengths:

We are able to respond very quickly as we have no red tape, and no need

for higher management approval.

We are able to give really good customer care, as the current small

amount of work means we have plenty of time to devote to customers.

Our lead consultant has strong reputation in the market.

We can change direction quickly if we find that our marketing is not

working.


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We have low overheads, so we can offer good value to customers.

Weaknesses:

Our company has little market presence or reputation.

We have a small staff, with a shallow skills base in many areas.

We are vulnerable to vital staff being sick, and leaving.

Our cash flow will be unreliable in the early stages.

Opportunities:

Our business sector is expanding, with many future opportunities for

success.

Local government wants to encourage local businesses.

Our competitors may be slow to adopt new technologies.

Threats:

Developments in technology may change this market beyond our ability

to adapt.

A small change in the focus of a large competitor might wipe out any

market position we achieve.


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II. THE 5 AND 6 FORCES MODEL

The 5 and 6 Forces Model

The 5 and 6 Forces Model look at product as 5 (or 6) key forces that shape

a business strategy .This framework goes deeper into the market dynamics of

where you are investigating a product .Each of the forces evaluates the

competitive intensity of a market. If there is intense competition, there is both

strong interest from potential buyers to purchase a product, and business

model(s) that ensure companies make a profit to meet this demand.

The forces include:1) Competition for your product.

2) New entrants that would compete in your space, often with new business

models.

3) End users/Buyers and their bargaining power on influencing price,

integration, and concentration.

4) Suppliers of raw materials, components and services for your product andtheir bargaining power on business strategy.


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5) Substitute products and those factors that influence it (cost of product,

perceived value, cost to switch, etc).

6) Complementary products/ The government/ The public. This 6th factor takes

into account strategic alliances and how the government or public can influence

business strategy for a particular product

III. PORTERS FIVE FORCES MODEL

The Porter's Five Forces tool is a simple but powerful tool for

understanding where power lies in a business situation. This is useful, because it

helps you understand both the strength of your current competitive position, and

the strength of a position you're considering moving into.


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With a clear understanding of where power lies, you can take fair advantage of a

situation of strength, improve a situation of weakness, and avoid taking wrong

steps. This makes it an important part of your planning toolkit.

Conventionally, the tool is used to identify whether new products, services or

businesses have the potential to be profitable. However it can be very

illuminating when used to understand the balance of power in other situations.

Five Forces Analysis assumes that there are five important forces that determine

competitive power in a business situation. These are:

Supplier Power

Buyer Power

Competitive Rivalry

Threat of Substitution

Threat of New Entry


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IV. PEST ANALYSIS

PEST analysis is a strategic business measurement tool.


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PEST is an acronym for Political, Economic, Social and Technological

factors.These factors are primarily external factors which are used prior to doing

a SWOT analysis (which is used to assess both internal and external factors).

PEST is used to assess business/strategy planning, marketing positioning,

business and product development, product introduction, new idea, business

diversification or to review the strategy or position of a organization.There are

variations to the PEST analysis like the PESTLE (includes Legal and

Ecological/Environmental)

There are many situations where systematic PEST analysis gives clarity

about the external factors which can affect the decisions such as :

Brand in relation to a market

Product Launch

Merger and Acquisition

Entering a new market

Potential Partnership

Investment opportunity

Company assessing the market conditions

Product versus competition

I. PESTLE

This is used to perform an external environmental analysis by

examining the many different external factors affecting an organization.

The six attributes ofPESTLE:

Political (current and potential influences from political pressures)

Economic (the local, national and world economy impact)
http://en.wikipedia.org/wiki/PESTLEhttp://en.wikipedia.org/wiki/PESTLE


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Sociological (the ways in which a society can affect an organization)

Technological (the effect of new and emerging technology)

Legal (the effect of national and world legislation)

Environmental (the local, national and world environmental issues)

II. HEPTALYSIS

This is used to perform an in-depth analysis of early stage

businesses/ventures on seven important categories.

Market opportunity

Product/solution

Execution plan

Financial engine

Human capital

Potential return Margin of safety

III. MOST

This is used to perform an internal environmental analysis by

defining the attributes of MOST to ensure that the project you are working on is

aligned to each of the four attributes.

The four attributes of MOST.

Mission (where the business intends to go)

Objectives (the key goals which will help achieve the mission)

Strategies (options for moving forward)

Tactics (how strategies are put into action


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IV. DE BONO'S SIX THINKING HATS

This is often used in a brainstorming session to generate and

analyze ideas and options. It is useful to encourage specific types of thinking

and can be a convenient and symbolic way to request someone to switch

gears". It involves restricting the group to only thinking in specific ways -

giving ideas & analysis in the mood of the time. Also known as theSix

Thinking Hats.

White: Pure facts, logical.

Green: Creative.

Yellow: Bright, optimistic, positive.

Black: Negative, devils advocate.

Red: Emotional.

Blue: Cold, control.
http://en.wikipedia.org/wiki/Six_Thinking_Hatshttp://en.wikipedia.org/wiki/Six_Thinking_Hatshttp://en.wikipedia.org/wiki/Six_Thinking_Hatshttp://en.wikipedia.org/wiki/Six_Thinking_Hatshttp://en.wikipedia.org/wiki/Six_Thinking_Hats


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CRITICAL SUCCESS FACTORS

Identifying the Things That Really Matter for Success

How will you measure success?

So many important matters can compete for your attention in business

that it's often difficult to see the "wood for the trees". What's more, it can be

extremely difficult to get everyone in the team pulling in the same direction and

focusing on the true essentials .That's where Critical Success Factors (CSFs) can

help. CSFs, also known as Key Results Areas (KRAs), are the essential areas of

activity that must be performed well if you are to achieve the mission,

objectives or goals for your business or project.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It

was then built on and popularized a decade later by John F. Rockart, of MIT's

Sloan School of Management, and has since been used extensively to help

businesses implement their strategies and projects.


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Inevitably, the CSF concept has evolved, and you may have seen it

implemented in different ways. This article provides a simple definition and

approach based on Rockart's original ideas.

Rockart defined CSFs as:

"The limited number of areas in which results, if they are satisfactory, will

ensure successful competitive performance for the organization. They are

the few key areas where things must go right for the business to flourish. If

results in these areas are not adequate, the organization's efforts for the

period will be less than desired."

He also concluded that CSFs are "areas of activity that should

receive constant and careful attention from management."Critical Success

Factors are strongly related to the mission and strategic goals of your business

or project. Whereas the mission and goals focus on the aims and what is to be

achieved, Critical Success Factors focus on the most important areas and get to

the very heart of both what is to be achieved and how you will achieve it.


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RESEARCH METHODOLOGY

Research methodology is a careful investigation for inquiring in a

systematic method and finding solution of a problem. It comprises the defining

and redefining of problem collection and evaluating data, making detection and

reaching conclusion. This research consists of following element.

Objectives of study

Sources of data

Research design

Sample design

Objectives of study

To analysis overview of Business stratagy.

To understand the various business strategies measures to success.

To study strategies and internal controls.

To analysis business strategies.

Sources of data

a. Primary data

b. Secondary data-


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Secondary data are those, which have already been collected by some

other purpose and published. Secondary data are the shape of finished products.

External Data, was generated from magazines ,research books and internet .In

this study secondary data is collected .it is collected through internet ,magazines

and books.

Limitations of the study

The following limitations have been found,

The research study has been done from a selective material on the

internet.

Only selective journals, papers and articles have been put to use because

of the time factor.

There is the possibility of further updating of this research paper because

of limited sources.


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GUIDE TO INTERNAL CONTROL


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CAMPUS PHILOSOPHY ON FISCAL RESPONSIBILITY

(Shared Responsibility for Maintaining Internal Controls)

Every individual within the University has some role in effecting

internal control, including each employee, manager, and supervisor, department

head, dean, director, senior executive, President and Curator. Roles vary with

responsibility. Managers are ultimately responsible for the appropriate use and

control of the funds entrusted to them. Management is accountable to the Board

of Curators, which provides governance, guidance and oversight, and is also at

times accountable to the IRS and funding agencies of federal, state and private

grants and contract.

KEY CONCEPTS OF INTERNAL CONTROL

Internal control is a process. It is a mea ns to an end, not an end in

itself. The goal is reliable financial reporting, effective and efficientoperations, and compliance with laws and regulations.

Internal control is affected by people. It's not merely policy manuals

and forms, but people's actions at every level of the organization.

COMPONENTS OF INTERNAL CONTROL

Key steps taken to achieve internal control are:

Preventative control activities

Preventive controls attempt to prevent or deter undesirable acts from occurring.

They are proactive controls, designed to prevent a loss, error, or omission.

Examples of preventive controls are:


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separation of duties

proper authorizations

adequate documentation

physical securityover cash and other assets

Detective control activities (Monitoring)

Detectivecontrols attempt to detect undesirable acts that have occurred. They

provide evidence after-the-fact that a loss or error has occurred, but do not

prevent them from occurring.

Regular supervisory reviewof account activity, reports, reconciliations.

Routine spot-checkingof transactions, records and reconciliations (do

things make sense and look reasonable)

Variance analysis, including budget to actual comparisons

Physical inventories

Control self assessment(such as this Guide and related Self-assessment

Questionnaire)

Internal auditreview of business units controls

Information and communications

Administrative information systems that provide necessary information to

the appropriate people, at the necessary level of detail, on a timely basis

Channels for employees to communicate suspected improprieties

upstream through other than a direct supervisor

Risk assessment-Management is responsible for assessing risks that could

undermine these objectives of financial statements:


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Establishing the existence/ownership of assets and liabilities

Proper valuation of assets and liabilities

Contain all transactions of the reporting period

Proper presentation and disclosure

Control environment

A control-conscious environmentis also necessary. It is an environment that

supports ethical values and business practices. Management is responsible for

"setting the tone" for their areas and encouraging the highest levels of integrity

and ethical behavior, as well as exhibiting leadership behavior that promotes

internal control and accountability.

The following steps are examples of this leadership behavior:

Communicate to employees that fraud and conflicts of interest will

not be tolerated.

Communicate to employees that University policies and procedures

are important and will be followed.

Make employees fully aware of their responsibilities, including

internal controls.

Monitor the internal controls system on an on-going basis.

SUSPECTED THEFT OR MISUSE OF ASSETS

SeeBusiness Policy and Procedure Manual Section 8:010 for procedures that

should be followed to report the loss of money, securities and property. A

written report is required, and in certain cases a telephone report.
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SEGREGATION OF DUTIES

No single person should:

o

record transactions and reconcile balances.

o handle cash and verify deposits.

o handle assets and reconcile perpetual records to physical

counts.

o enter or approve a check request and have the check returned

to themselves.

Segregation of duties is essential to effective internal control. It reduces the risk

of both erroneous and inappropriate actions. It is a deterrent to fraud. Key

functions that must be adequately separated are described above. When it is

extremely difficult to separate these functions, a detailed supervisory review of

related activities or transactions is required as a compensating control activity.

To ensure proper separation of duties, a person should never approve atransaction for which they are the payee.

REVIEWS BY MANAGEMENT

Perform budget to actual expense comparisons and investigate significant

differences. Routinely spot-check transactions, records, and reconciliations to ensure

expectations are met as to timeliness, completeness, segregation of duties,

propriety of the transaction, etc.

Follow up on unexpected results or unusual transactions. They might be

indications of theft or fraud. Ask for explanations of unexpected results

and ask for reasons for unusual transactions. Question the explanationsand reasons if they dont seem right, ask to see the items that were


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purchased, etc. (See Suspected Theft or Misuse of Assets section in this

Guide.)

Document your reviews of reports and reconciliations by initialing and

dating them and briefly indicating the resolution of any follow-up you

performed on unexpected results or unusual transactions.

RECONCILIATIONS

Broadly defined, reconciliationis a comparison of different sets of data in order

to ensure the accuracy and completeness of transactions. Integral parts of the

reconciliation process include identifying and investigating differences, and

taking corrective action, when necessary, to resolve differences.

To ensure proper separation of duties, the person who enters or approves

transactions or handles cash receipts should not be the person who performs the

related reconciliations.

Reconciliations should be performed timely, documented, and approved by

management.

Examples of important reconciliations that should be performed are:

Reconciling the dollar amount of cash and checks received per

original records (not per the receipt vouchers) to the dollar amount

actually deposited.

Reconciling actual payroll expenses to expected payroll expenses.


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APPROVALS

Approval authority should only be given to individuals with sufficient

authority and knowledge to recognize and challenge unusual transactions.

Control authority to approve with limits on both transaction amount

and number of employees granted authority

Review supporting documentation

Compliance with University policies and procedures

Question unusual items

Determine if budget exists

Determine if charges to grants are allowable

No "rubber stamps" or "blind" approvals

No sharing of passwords

No splitting of transactions to avoid higher approval levels

To ensure proper separation of duties, a person should never approve a

transaction for which they are the payee.If the reviewer notes any transaction(s)

that, after his/her investigation, is not a legitimate department expense, he/she

should contact his/her supervisor.Password security should be adjusted upon an

employee's termination, transfer, or change in responsibilities.

ASSETS

In addition to cash and inventory, all equipment and supplies, irregardless of

original cost, are consideredassetsof the University.

Physically secure your areas assets.

Cash, inventory, equipment, and supplies must be safeguarded from

unauthorized access, use or theft. Examples of access controls to safeguard

assets are locked doors, filing cabinets, and drawers, and safes. The number


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of individuals with access to the keys or lock combinations should be as few

as possible. Locks should be changed when employees who had keys to

significant amounts of assets terminate.

Conduct periodic counts of inventories.

Compare inventory counts to your departments perpetual inventory

book records and investigate differences.

Departments with significant inventories should maintain inventory

controls over the items. Inventory items received and issued should be recorded,

so that a current "book" balance is always known. Periodically, a person who is

independent of the inventory purchasing and inventory custody functions should

physically count the inventory items. The counts should be compared to the

"book" balances. Missing items should be investigated, resolved, and analyzed

for possible control deficiencies. Book records should be adjusted to the

physically counted quantities if missing items cannot be located.

Update the fixed asset information distributed to you bi-annually.

Record asset disposals and transfers between areas timely.

Fixed asset listings should be periodically reviewed and compared to assets

physically on-hand. Missing items should be investigated, resolved, and

analyzed for possible control deficiencies. Fixed asset listings should be updated

accordingly.

BANK ACCOUNTS

Individual schools, departments, and divisions cannot establish bank

accounts without the approval of MU Administrative Services.

PETTY CASH


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There are a limited number of petty cash funds on campus. The following

guidelines are for those departments with a petty cash fund.

Keep the petty cash fund in a locked, secure place.

Access to the petty cash fund should be restricted to the custodian and a

back-up person.

Petty cash should be disbursed only by the custodian (or a back-up person

in the custodian's absence).

Require original receipts in order to disburse petty cash. Maintain the

receipts in the petty cash fund box for reconciling.

The person to be reimbursed should indicate on the original receipt what

was purchased (if not obvious on the receipt), the business purpose, and

account and fund to be charged.

The original receipts should be approved and signed by an appropriate,

authorized individual, such as the supervisor of the person to be

reimbursed.

The petty cash fund should not be used for personal expenses, personal

loans, or the cashing of personal checks.

The Custodian is responsible for regularly reconciling the petty cash

fund. (The sum of cash plus original receipts plus any outstanding

reimbursements should equal the full, original amount of the fund.)

Periodic, surprise counts of the petty cash fund should be performed by

someone other than the custodian, such as a supervisor.

A petty cash fund remains open on the records of the Accounting

Services Department until you request that it be closed. The Accounting

Services Department performs an annual written confirmation of the petty

cash account balances.

Decide if you really need a petty cash fund. If not, contact the Accounting


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Services Department to close the fund. Deposit the petty cash fund

money, indicating on the receipt voucher that it is the closing of the petty

cash fund.

In the event of an unexplained petty cash shortage, see the section on

Suspected Theft or Misuse of Assets

CASH,CHECK, CREDIT CARD RECEIPTS

Procedures should be followed for depositing cash as follows:

o

Locations that deposit directly to the bank should follow the

procedures described in theCash Receipts Manual

o Locations that deposit with campus Cashiers should follow the

procedures described inBusiness Policy and Procedure Manual

Section 2.060.

Maintain a manual or electronic log of all cash, checks, and credit card

payments received (include check numbers). This log should list the

amount received, its form (cash, check, or credit card), the payor, and the

purpose of the payment.

Provide numbered receipts for all payments received, regardless of

payment type (cash, check, or credit card). Two-part forms should be

used, with one copy being kept and one copy provided to the payor.

All receipts should be properly accounted for and should agree with thelog used to record monies received.

Immediately restrictively endorse checks received with a stamp as

described inCash Receipts Manual.

Keep cash, checks, and credit card forms in a locked, secure, and

restricted facility, such as a drawer or safe, until they are deposited. Limit

who has access and keys/combinations to the locked facility.
http://www.umsystem.edu/ums/departments/fa/treasurer/manual/http://bppm.missouri.edu/chapter2/2_060.htmlhttp://bppm.missouri.edu/chapter2/2_060.htmlhttp://www.umsystem.edu/ums/departments/fa/treasurer/manual/crm204.shtmlhttp://www.umsystem.edu/ums/departments/fa/treasurer/manual/crm204.shtmlhttp://www.umsystem.edu/ums/departments/fa/treasurer/manual/crm204.shtmlhttp://www.umsystem.edu/ums/departments/fa/treasurer/manual/crm204.shtmlhttp://bppm.missouri.edu/chapter2/2_060.htmlhttp://bppm.missouri.edu/chapter2/2_060.htmlhttp://www.umsystem.edu/ums/departments/fa/treasurer/manual/


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Deposits must be made at least once daily unless otherwise authorized in

writing by Campus Administrative Services. If minimal dollar amounts

are received, deposits should be made when amounts total $100 or at least

weekly.

Prepare on-line receipt entries (CRRs) to the general ledger for each

deposit.

Require an employee with no cash handling responsibilities to verify that

the amounts actually deposited equal the amounts from the log or

receipts, not from the receipt voucher.

GIFTS

Restrictively endorse checks upon receipt by stamping as described in

Cash Receipts Manual.

Make a record of all incoming gift and endowment checks and cash.

Deposit the endorsed checks and cash with other types of cash receipts

immediately, using the Gift CRR application.

Reconcile your record of incoming gift and endowment checks and cash

to the Universitys gift system (ADIS) to ensure all amounts have been

received and deposited.

Notify the campus Development office upon receipt of non-cash gifts.

Appraisals of non-cash gifts must be made by an outside appraiser and

must be paid for by the donor.

(See Business Policy and Procedure Manual Section 2:130)

PAYROLL/PERSONNEL
http://www.umsystem.edu/ums/departments/fa/treasurer/manual/crm204.shtmlhttp://bppm.missouri.edu/chapter2/2_130.htmlhttp://bppm.missouri.edu/chapter2/2_130.htmlhttp://bppm.missouri.edu/chapter2/2_130.htmlhttp://bppm.missouri.edu/chapter2/2_130.htmlhttp://www.umsystem.edu/ums/departments/fa/treasurer/manual/crm204.shtml


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Non-exempt employees (employees eligible for overtime pay) must

complete timesheets of the number of hours they worked each day. This

is a federal requirement.

Timesheets must be approved and signed by appropriate supervisors.

Overtime requires the advance approval of a supervisor, i.e., before it is

worked.

Track each employee's sick leave and vacation time.

Access to payroll information should be very limited.

Direct deposit of paychecks is required for all new employees.

Do not release wage information externally without the written consent of

the employee (or a subpoena).

Question whether any independent contractors in your area should instead

be classified as employees. The U.S. Internal Revenue Service has rules

defining independent contractors versus employees. For more information

contact Administrative Services, 882-7254.

ACCOUNTS PAYABLE

Do not request checks to parties outside the University to be returned to

departments or employees.

Original invoices should be sent directly to Accounts Payable by vendors.

Don't request a rush check or an online (hand-drawn) check if the

issuance of the check is not critical.

Keep supporting documentation for auto-approved (recurring) check

requests in the departments.

Review invoices related to blanket purchase orders for reasonableness.

An employee should not also be paid as an independent contractor.


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TRAVEL

Spouse or guest travel is unallowable as a charge to federal grants and

usually unallowable as a University expense - look at meal and hotel

receipts for evidence of multiple travelers.

Alcohol is unallowable as a charge to federal grants - look at meal and

hotel receipts.

Encourage the use of the Universitys travel portal for information about

travel.

HUMAN RESOURCES

Ensure terminated employees are promptly removed from the Payroll

system.

Form I-9 (employment eligibility verification) data must be collected and

verified within three days of hire.

Any court-ordered garnishments, child support orders, and tax levies

should be forwarded immediately to your respective Human Resources

Office.

Employees must be paid at least minimum wage and be 16 years old.

PURCHASING

Do not permit purchases of personal items, even if employees will

reimburse.

Sales tax should not be incurred.

When purchasing products or services from employees and/or relatives of


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employees, follow conflict of interest and disclosure policies.

Competitive bids or sole source justifications must be obtained by the

Purchasing Department in advance of any purchase of $5,000 or more.

Encourage the use of the Universitys preferred suppliers in order to

receive special rates based on contracts the Universitys Purchasing

Services Department has negotiated.

Purchase Orders:

Obtain purchase orders in advance of purchases.

Procurement cards:

Procurement cards should be kept in a secure location.

The only person authorized to use a procurement card is the cardholder

whose name is on the front of the card.

Because of the potential personal use of procurement cards, the approvals

of such transactions should be serious and thorough. Any unusual items

or use of unusual vendors should be questioned. Personal use of

procurement cards is not permitted.

Original receipts, not copies of receipts, should be on file in

departments/schools for all procurement card transactions.

CONTACTS FOR ASSISTANCE

For assistance with any questions about internal control, please contact these

offices:

Cash, check, credit cards Cashiers Paul Toler 882-

4959

[email protected]

du

Payroll Payroll Amy

McKenzie

882-

6548

Mckenziea@missou

ri.edu
http://localhost/var/www/apps/conversion/tmp/scratch_5/[email protected]://localhost/var/www/apps/conversion/tmp/scratch_5/[email protected]:[email protected]:[email protected]:[email protected]:[email protected]://localhost/var/www/apps/conversion/tmp/scratch_5/[email protected]://localhost/var/www/apps/conversion/tmp/scratch_5/[email protected]


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Accounts payable

disbursements

Accounti

ng

Rita Wells 882-

2483

[email protected]

u

Human resources HR Jatha

Sadowski

882-

4859

sadowskij@missour

i.edu

ROLE OF INTERNAL AUDIT

The UM Internal Auditing Department is responsible for performing internal

audits at the University. Internal audits assist management by providing

independent and objective analyses of activities and controls. Audit scopes can

range from a single process to all business activities in a division, department,

or school. Internal Auditing makes recommendations as a result of those

analyses. Internal Audit makes regular reports to the audit subcommittee of the

Board of Curators and the President on the results of internal audits and the

completion status of audit recommendations .The Administrative Services office

is responsible for coordinating the on-campus activities of all internal audits on

the Columbia campus and serves as liaison between internal auditors and

campus departments when appropriate. If your office is contacted by anyone

who represents themselves as internal auditors, contact Administrative Services

at 882-7348.
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


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CONCLUSION

BUSINESS Strategy perform a very important role to get success in ourbusiness. but it is necessary to put right strategy. Strategy is about making

choices. You should be able to see the impact of your strategic planning work

and how it will benefit the business through the following issues :Take one

analysis technique as an example,PEST Analysis.

As you work through the difficult categories of political, social, economic

and technological changes you may spot an opportunity or a threat much earlier

than you would have done normally.

This gives you a chance to think deeply about it, decide how it will

potentially impact on your business and then decide what you will do about it.

As you take action and watch the situation unfold, you see your competitors

scrambling to catch up.

How much of the full strategy process you need depends on your

situation, both the business and its competitive environment and also on the

time and resources you have .When Ive spoken to turnaround experts, they

believe in the strategy process but often there is only time for a limited amount

of work before the big decisions have to be made.
http://www.differentiateyourbusiness.co.uk/pest-analysis-the-way-to-understand-the-wider-environmenthttp://www.differentiateyourbusiness.co.uk/pest-analysis-the-way-to-understand-the-wider-environment


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REFERENCE

BIBILIOGRAPHY-

STRATAGIC MANAGEMENT-M.COM

BUSINESS STRATAGY

WEBIOGRAPHY-

WWW.GOOGLE.COM

WWW.BUSINESSSTRATAGY.COM

WWW.STRATEGICMANAGEMENT.COM
http://www.google.com/http://www.google.com/http://www.business/http://www.business/http://www.strategicmanagement.com/http://www.strategicmanagement.com/http://www.strategicmanagement.com/http://www.business/http://www.google.com/


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final business stratagy

Documents