Study of Mission Statement as a Marketing Strategy:

An Analysis of Amazon.com and Wal-Mart Mission Statement

BUS 5110 - Managerial Accounting

Portfolio Activity Unit 5
9 December - 15 December

Dr. Angela Palmer

Professor

This unit has focused on manufacturing companies; however, many companies are service
operations that do not sell a physical product. For this portfolio assignment, select a for profit
service company and describe the process it would use to create a master budget. How would
the budget process for the service company differ from a manufacturing company? Be
specific.

As portfolio activities are to be self-reflective, please make sure to connect the portfolio
assignment to:
• Your personal experiences. Reflect on how this assignment topic is applicable to and
will benefit you.
• Course readings and any external readings.
• Discussion forum posts or other course objectives.

The Portfolio Activity entry should be a minimum of 500 words and not more than 750
words. Use APA citations and references if you use ideas from the readings or other sources.

This assignment will be assessed using the Portfolio rubric.

 Introduction

Service firms, according to Heisinger and Hoyle (2012), do not generate physical
commodities, raw materials, or inventories. As a result, they are exempt from budget
constraints in production, inventory management, and procurement. Instead, monies are
allocated to sales, human resource development, and marketing.
The primary restraint on service organizations' budgets is generating consistent
revenue. In contrast to industrial firms, a service company's "productive unit" is distinct from
the rest of the corporation. Each customer has distinct objectives and prefers solutions that are
personalized to their individual requirements. Customer retention is crucial for service
businesses operating under such limitations. Receipts account for a significant percentage of
sales budgeting.
Planning and budgeting are analytical processes that enable firms to create top-down
objectives and bottom-up budgets that serve as the basis for their operations. It aids
management in examining company prospects and creating financial goals, and it promotes
collaboration and efficiency throughout the budgeting iterative process—re-evaluating costs
and revenue forecasts, revising start and finish dates, and changing targets.
When the basic assumptions of planning and budgeting are the same, different
departments may use tools that are compatible with one another. By distributing a shared
business model through the internet with role-based access, every member may contribute to
any area of the company's strategy or budget at any time and from any location on the earth.
The corporation can respond swiftly and efficiently to changing business situations. A
corporation may do what-if research and modelling prior to implementation to simulate staff
changes, cost-cutting measures, and capital investment plans. Marketing volatility and other
variations from the initial method may be dealt with on a more regular rather than annual basis.

A typical service business's budgeting method is as follows:

1.Make a list of your financial goals.

2.Retrieve information from both the past and the present.
3. Make a simple budget.
4.Collect data and create a budget
5.Conduct a financial audit
6.Reporting and Publication of Results
7.Continue to monitor and adjust as required (Feedback)
 Consider Accenture, the world's largest business process outsourcing organization,
which reported revenue by 14% in fiscal year 2021. (Accenture,2021). Accenture's sales budget
for next year then, should be comparable to prior years of sustained revenue growth in the face
of a worldwide pandemic.
Increased sales predictions need the employment of more staff as well as the funding
of internal training. While service firms do not offer physical things, they make their money
entirely via the effort of their employees. Salary is the most important variable expense.
More funding is required for workforce development. A successful service organization
must constantly improve the quality of its workforce to stay up with market and regulatory
developments. Accenture University was founded with this goal in mind as a company-wide
educational institution. These predicted costs must be regarded as fixed costs.
Another example of a service company's fixed expenditures is a marketing budget.
Because a service firm does not sell a particular product, its marketing efforts are entirely
focused on brand promotion. In addition to conventional advertising, service companies may
brand themselves through participating in educational, environmental, and social impact
programs.
A budgeted income statement, cash flow statement, and balance sheet are included in
the master budget. It is the sum of the sales, human resources, education, marketing, and
general and administrative costs budgets.
While budgeting for a service business is like budgeting for a manufacturing firm, the
fundamental distinction is that the service firm must prioritize employee empowerment and
development above material and production cost savings.

Reflection
A budget is a planning tool that enables us to establish a goal and track the measures
required to achieve it. Therefore, a budget enables us to assess our company's future direction.
If we prepare ahead of time, we can avert disasters more successfully. A budget is a detailed
projection of future revenue and expenses - a profit and loss statement. Consequently, after the
budgeted time has passed, we may compare the actual outcomes to the predicted results. For
example, if we discover that some expenses are larger than planned, we may begin to search
for methods to reduce them. If we do not meet our objective, we may elect to pursue revenue-
generating ventures. Budget planners may either start with a sales projection and work their
way down or start with a profit forecast and work their way up. The latter method is preferred
by most organizations. In other words, we determine the desired profit first, followed by the
expenditures needed to achieve that profit.

Word Count: 748

 References

Accenture.com. 2021. Accenture | Let there be change. [online] Available at:

<https://www.accenture.com/us-en> [Accessed 14 December 2021].

Accenture.com. 2021. Accenture | Let there be change. [online] Available at:

<https://www.accenture.com/us-en> [Accessed 14 December 2021].

Greenberg, P. S., & Greenberg, R. H. (2006). Who needs budgets? You do. Strategic

Finance, 88(2), 40.

Heisinger, K., & Hoyle, J. (2012). Managerial Accounting. Saylor Foundation.

Libby, T., & Lindsay, R. M. (2007). Beyond budgeting or better budgeting?. Strategic

Finance, 89(2), 46.

Pietrzak, Ż. (2013). Traditional versus activity-based budgeting in non-manufacturing

companies. Social Sciences, 82(4), 26-37.

Tarigan, J. (2016). The Influence of Budgeting Participation on Managerial Performance in

Service Companies: An Evidence from Indonesia. Journal of Accounting and

Finance, 15(8), 96.

Wilhelmi, M., & Kleiner, B. H. (1995). New developments in budgeting. Management

Research News.