BBMA4303

FACULTY OF ACCOUNTING

SEPT 2019

BBMA4303
ADVANCED MANAGEMENT ACCOUNTING

NAME : OMAR AFIQ BIN

ALI MATRICULATION NO: 900120055297001
IDENTITY CARD NO. : 900120-05-5297
TELEPHONE NO. : 012-640 2004
E-MAIL : akuislam18@yahoo.com
LEARNING CENTRE : OUM LAHAD DATU

0
 BBMA430
PAGE 3

APPRECIATION 2

PART 1

1.0 INTRODUCTION ENVIRONMENTAL MANAGEMENT ACCOUNTING 3

AND SYSTEM

2.0 REVIEW ON ENVIRONMENTAL MANAGEMENT ACCOUNTING AND 5

SYSTEM

3.0 ROLES OF ENVIRONMENTAL MANAGEMENT ACCOUNTING AND 6

SYSTEM
4.0 SUMMARY 8

5.0 RESOURCES 9

PART2
1.0 INTRODUCTION TO PERFORMANCE EVALUATION 10
2.0 REVIEW ON ENVIRONMENTAL MANAGEMENT ACCOUNTING AND
10
SYSTEM
3.0 REVIEW ON ENVIRONMENTAL MANAGEMENT ACCOUNTING AND
SYSTEM 11

4.0 SUMMARY 13
5.0 RESOURCES 14

1
 BBMA430
3

APPRECIATION

Praise to Allah SWT for His grace, finally I had finished this assignment perfectly. First of all, I
would like to thanks to our Lecturer, who was helpful in giving guidance that is useful in the
process of completing the task .Without the guidance from my lecturer this assignment maybe
cannot be completed in a set time. I would also like to express my appreciation to my parents who
for encouragement and support in completing this task. Also to friends who never fail to give help
and encouragement and to all parties involved indirectly helped me in completing this task. My
hope is that this assignment can be beneficial not only to me but also all student of OUM. Thank
you.

2
 BBMA430
3

PART 1

1.0 INTRODUCTION ENVIRONMENTAL MANAGEMENT ACCOUNTING AND SYSTEM

Environmental management accounting (EMA) is the identification, collection, analysis and use of two
types of information for internal decision making. The first is physical information on the use, flows and
rates of energy, water and materials (including wastes). The second is monetary information on
environment-related costs, earnings and savings.
EMA addresses the management information needs of managers for corporate activities that affect the
environment, as well as environment-related impacts on the corporation. Depending on the type of
organisation, environmental impacts could include production effluent, recycling, water and power
consumption, and carbon footprint.

Management information could include:

 Identifying and estimating the costs of environment-related activities

 Identifying and monitoring the use and cost of resources such as water, electricity and fuel, so costs
can be reduced
 Making sure environmental considerations form part of capital investment decisions
 Assessing the likelihood and impact of environmental risks
 Including environment-related indicators as part of routine performance monitoring
 Benchmarking activities against environmental best practice.

Environmental costs can be categorised as follows:

 Prevention costs: costs associated with preventing adverse environmental impacts.

 Appraisal costs: costs of assessing compliance with environmental policies.
 Internal failure costs: costs of eliminating environmental impacts that have been created by the
organisation.

3
 BBMA430
 External failure costs: costs incurred after environmental damage has3 been caused outside the
organisation.

An environmental management system (EMS) is "a system and database which integrates procedures and
processes for training of personnel, monitoring, summarizing, and reporting of specialized environmental
performance information to internal and external stakeholders of a firm".

The most widely used standard on which an EMS is based is International Organization for Standardization
(ISO) 14001. Alternatives include the EMAS.

An environmental management information system (EMIS) or Environmental Data Management System

(EDMS) is an information technology solution for tracking environmental data for a company as part of
their overall environmental management system.

An EMS can also be classified as

 system which monitors, tracks and reports emissions information, particularly with respect to the
oil and gas industry. EMSs are becoming web-based in response to the EPA's mandated greenhouse
gas (GHG) reporting rule, which allows for reporting GHG emissions information via the internet.
 centrally controlled and often automated network of devices (now frequently wireless using z-wave
and zigbee technologies) used to control the internal environment of a building. Such a system
namely acts as an interface between end user and energy (gas/electricity) consumption.

The goals of EMS are to increase compliance and reduce waste:

 Compliance is the act of reaching and maintaining minimal legal standards. By not being
compliant, companies may face fines, government intervention or may not be able to operate.
 Waste reduction goes beyond compliance to reduce environmental impact. The EMS helps to
develop, implement, manage, coordinate and monitor environmental policies. Waste reduction
begins at the design phase through pollution prevention and waste minimization. At the end of the
life cycle, waste is reduced by recycling.

4
 BBMA430
3

2.0 REVIEW ON ENVIRONMENTAL MANAGEMENT ACCOUNTING AND SYSTEM

To meet these goals, the selection of environmental management systems is typically subject to a certain set
of criteria: a proven capability to handle high frequency data, high performance indicators, transparent
handling and processing of data, powerful calculation engine, customized factor handling, multiple
integration capabilities, automation of workflows and QA processes and in-depth, flexible reporting.

An environmental management system (EMS):

 Serves as a tool, or process, to improve environmental performance and information mainly

"design, pollution control and waste minimization, training, reporting to top management, and the
setting of goals"
 Provides a systematic way of managing an organization’s environmental affairs
 Is the aspect of the organization’s overall management structure that addresses immediate and long-
term impacts of its products, services and processes on the environment. EMS assists with
planning, controlling and monitoring policies in an organization.
 Gives order and consistency for organizations to address environmental concerns through the
allocation of resources, assignment of responsibility and ongoing evaluation of practices,
procedures and processes
 Creates environmental buy-in from management and employees and assigns accountability and
responsibility.
 Sets framework for training to achieve objectives and desired performance.
 Helps understand legislative requirements to better determine a product or service's impact,
significance, priorities and objectives.
 Focuses on continual improvement of the system and a way to implement policies and objectives to
meet a desired result. This also helps with reviewing and auditing the EMS to find future
opportunities.
 Encourages contractors and suppliers to establish their own EMS.
 Facilitates e-reporting to federal, state and provincial government environmental agencies through
direct upload.

5
 BBMA430
3
3.0 REVIEW ON ENVIRONMENTAL MANAGEMENT ACCOUNTING AND SYSTEM

Benefits of environmental management accounting

 Improving sales or reducing sales erosion: consumer awareness of products and services'
environmental impact is increasingly influencing their preferences and buying behaviours.
 Reducing costs: reducing wasteful consumption of input resources has a direct positive impact on
reducing costs. Also, improvements to processes can bear down on costs.
 Reducing the cost of failure: investing in processes that reduce the likelihood and cost impact of
failure, such as the need to process waste or clean up environmental impacts.
 Improving the image of the organization : this can enable it to attract better talent, reduce talent
attrition and charge higher prices.

Benefits of environmental management system

 EMS management system helps reduce waste

Every organisation can reduce waste from the smallest of companies with a recycling program to larger
companies who minimise waste through design innovations.

For example: Leanne’s Landscaping design and construct small public spaces like recreation or garden
areas in hospitals. The company only uses recycled materials, and designs all the items such as seating and
play equipment to be 100% recyclable or reusable at the end of their life. A full guide on how to recycle or
reuse their products forms part of the handover of the job.

 Maximise resources

Maximising your resources is closely aligned with waste reduction. When a business can get more than one
use out of their raw material this has multiple benefits.

1. Waste reduction – The more you can use out of one source the less you will throw away. Decreasing
waste transport costs and transport emissions and resulting in less landfill.
2. Increased Efficiency – Ordering 1 product instead of multiples can save time in the procurement process,
reduce delivery costs and storage space needed.

6
 BBMA430
3
3. Innovation – When you start to look at resources differently you start to see more possibilities.

 Minimise environmental risk

Environmental risks will differ from one industry and company to the next. Determining your
environmental risks is a 2-part process.

1. Determining the activities your business performs which may have an impact on the environment. These
are known as aspects.

2. The level of impact they can or do have. When determining impacts consideration must be given to the
severity and longevity of the impact.

Let’s look at Sam’s Signs. Sam produces and places large advertising stickers on shopfront windows. Sam
identified several environmental aspects including waste from the backing of the stickers he prints. These
were not recyclable or biodegradable meaning they went into the bin and added to landfill. If Sam only did
1 job a day his impact would be quite low. Yet, Sam has 10 outlets with an average of 5 jobs a day, that’s
250 sticker backings going to waste every week, that’s well over 10,000 a year. The impact is now much
higher. Sam approached the manufacturer and they developed a biodegradable alternative that is designed
to breakdown after 5 years of exposure to moisture. Now the impact is shorter term and thus is significantly
reduced.

 Improve sustainability
How much does your business currently rely on natural resources?

You might have a fleet of cars using petroleum. Can you change to hybrids? Your admin team might still
print a copy of every document sent by email. Paperless systems are far more effective and efficient. How
water or power hungry is your business? A water tank or solar at your business premises may also save you
money. Check out what your competitors are doing. By implementing just a few sustainability
improvements you can gain an edge and stay in front of rising costs giving your business a greater chance
of long-term success.

7
 BBMA430
4.0 SUMMARY 3

In many developing countries, the current environmental challenges caused by one dependence on non-
renewable energy, the waste created by mankind, the toxic emissions created by polluting the air one
breathes and also the scarce supply of water are so complex and important that they require one immediate
attention. Strict environmental legislation, market pressures and the urgent need for sustainability, have
given businesses no option but to ensure that they do all that is possible to ensure that their business
operations are sustainable. Environmental Management Accounting (EMA) has been developed to provide
past-oriented information, based on the continuous recording system which provides information required
for investment appraisal and financial planning. EMA provides a combination of both financial and
physical information regarding the environmental impacts and performance of a business.

8
 BBMA430
5.0 RESOURCES 3

 https://www.cgma.org/resources/tools/cost-transformation-model/environmental-management-
accounting.html

 https://www.emisoft.com/8-things-to-look-for-when-selecting-software-for-managing-high-
frequency-environmental-data/

 https://info.era-environmental.com/news/bid/70641/era-environmental-introduces-direct-upload-to-
tceq-s-steers

 https://www.businessbasics.com.au/benefits-of-environmental-management-system/

9
 BBMA430
PART 2 3

1.0 INTRODUCTION TO PERFORMANCE EVALUATION

A performance evaluation is a common tool used in an organization to provide feedback to an employee.

Hiring managers and workers need to understand the importance and value of appraisals for them to
produce positive results. A primary purpose of the evaluation process is to help an employee understand his
performance and help him achieve goals.

2.0 LITERATURE ON PERFORMANCE EVALUATION

Motivation is naturally conceptualized either as an desire arising from within the human being or as an
impulse arising from within the organism or as an attraction arising from an object external to the
individual. According to Baron (1991) defines motivation as the internal processes that activate, guide, and
maintain behaviour especially goal-directed behaviour. Also (Kanfer, 1998) defines as free will element of
behaviour and the psychological mechanism governing the direction, intensity, and persistence of action not
due solely to individual differences in ability or overwhelming environmental demands that force action.
Motivation has been defined as essential to adaptive functioning and quality of life, and as the content of
the positive thinking one wishes to maintain towards the attainment of an objective. According to Kanfer
states that challenges facing researchers into motivation is that it cannot be seen and most individual see is
‘a multidimensional stream of behaviour and the products of those behaviours’. Also states ‘motivational
processes can be inferred only from analysis of this continuing stream of behaviour that is determined both
by environment and heredity and is observed through their effects on personality, belief, knowledge,
abilities and skills. Besides that, Herzberg, describes ‘movement’ as a function of fear of punishment or
failure to get extrinsic rewards and motivation as a function of growth from getting intrinsic rewards out of
interesting and challenging work. Motivation is to be intrinsic and extrinsic. Intrinsic motivation is internal.
Intrinsic motivation is obvious as the performance of an activity for its inborn satisfaction rather than for
some detachable outcome. As soon as, intrinsically motivated, a person is stimulated to take action for the
pleasurable or challenge entailed relatively than because of external products, pressures. It occurs when
people are compelled to do something out of pleasure, importance, or desire. Extrinsic motivation occurs
when external factors compel the person to do something. Extrinsic motivation is a pull together that
pertains whenever an action is done in order to reach some detachable result. Motivation is the driving
force within individuals that compels them physiologically and psychologically to pursue one or more goals
to fulfil their needs or expectations.

10
 BBMA430
3.0 IMPACTS OF PERFORMANCE EVALUATION ON EMPLOYEES MOTIVATION
3 AND
ETHICS

This literature study tries to examine how work motivation affects the job performance within an
organization. There are a lot of aspects which can influence / create the work motivation within an
organization. Out this research there can be said that interests, enjoyment, salary and power can influence
the work motivation of employees. When managers want to measure the motivation, they can use ‘self-
reports’ over time. After a period the managers can compare the two points with each other.

Job performance can just like work motivation divided in task and contextual performance. The
performance can simply be measured over time. After a specific period they can see if the performance of
an employee is increased or decreased. There are found some variables that influence the job performance.
The most important variables are enjoy, interests, money and power. All four of these variables have a
positive influence on the job performance but all four in another way.

In this study there are some aspects which could have influence on the relationship between work
motivation and job performance. First off all there can be said that the relation between work motivation
and job performance is positive.

There are two combinations which are interesting. First, the relation between intrinsic motivation and task
performance is interesting. When employees are intrinsically motivated the task performance of employees
will increase. Second, the relation between extrinsic rewards and performance is interesting. When
employees receive an extrinsic reward like money ore promotion, their performance will also increase.

Researchers have found a positive connection between intrinsic motivation and job performance. According
to Humphrey (2007) intrinsic motivation is positively related to work performance, organizational
commitment and job satisfaction. Job autonomy is also inherent to intrinsic motivation (Morgeson,
Delaney-klinger, & Hemingway, 2005). When employees are intrinsically motivated their satisfaction and
enjoy is higher than an employee who is extrinsically motivated. Because of the intrinsic motivation of the
employee, the autonomy will increase as well (Parker, 1998). This is for manager’s important data because,
the higher autonomy of employees the more individuality the employee has. The manager can give more
support to other employees by who the autonomy is lower.

11
 BBMA430
Another relationship between motivation and performance has been found. Researchers
3 found a positive
connection between intrinsic work motivation and task performance (Morgeson et al. 2005). If employees
have a certain pleasure and satisfaction when they are at work, this will have a positive effect on the work
activities. According to Grouzet, Vallerand, Thill & Provencher (2004) individuals who are intrinsically
motivated perform better in their tasks because they find their tasks enjoyable and interesting. They also
find that participation in those specific tasks is like a reward (Deci et al. 1989). This is in line with the study
of Morgeson (2005). Morgeson (2005) also found that the progress of the work activities is inherent to the
job performance (Morgeson et al. 2005). Therefore the better the employees’ work activities the better the
job performance.

Finally, Gagné and Deci (2005) found that employees who have a high intrinsic motivation are more
involved in their jobs and they have a greater goal attainment than employees who have a lower intrinsic
motivation. According to Humphrey (2007) employees who are intrinsically motivation not only have a
greater goal to attainment but, they also have a greater responsibility and volition to perform better and to
be successful in the organization. The connections above are interesting because a large amount of
researchers agree in the concept that intrinsic motivation influences the job performance positively.

12
 BBMA430
4.0 SUMMARY 3

Performance evaluations are one of the most important communication tools an organization can use. They
need not be complicated; they just need to be done. Performance evaluations benefit both employee and
employer. It is a time to provide feedback, recognize quality performance and set expectations for future
job performance. It is also a time to have candid conversations about performance that is lacking and how
performance can be improved. Ongoing performance discussions can assist in avoiding serious problems in
the future.

A few basic tips make evaluations successful. Conduct evaluations on all employees on a regular schedule,
at least annually, so employees know it is a regular part of their employment. Prepare in advance looking
back at the employees’ performance over the entire review period so you can discuss their performance in a
meaningful way. Give employee notice so they can also be prepared to discuss issues or concerns. Share
the floor by allowing the employee equal time to talk.

13
 BBMA430
5.0 RESOURCES 3

 https://work.chron.com/introduction-performance-evaluation-29578.html

 https://www.ukessays.com/essays/business/motivation-theory-literature-review-business-essay.php

14