题目内容
Section A – BOTH questions are compulsory and MUST be attempted
Lincoln & Lincoln Advertising (LLA) is an advertising agency based in Veeland, which is a large well-developed country considered to be one of the wealthiest in the world. LLA operates out of three regional offices (North, East and West) with its head office functions based in the East offices. The business offers a wide range of advertising services:
Strategic: Advising on an overall advertising campaign (mix of advertising channels and overall themes);
Buying: Advising and buying advertising space (on television, radio, websites and in newspapers and magazines); and
Creative: Designing and producing specific adverts for the customers’ use.
The company is one of the three largest agencies in Veeland with many years of experience and many awards won. Competition in advertising is fierce, as advertising spending by businesses has suffered recently during a general economic downturn. Most new business is won in tender competitions between different advertising agencies.
Veeland is a large country with considerable diversity of markets, economic conditions and fashions across its regions. As a result, the regional offices have developed with a considerable amount of decision-making autonomy. This also reflects the temperament of the key creative employees of the firm who have a strong attachment to their campaign ideas and take great personal pride in their success. The individualism of the key employees also comes from the way that LLA has grown. The business has been built through acquisition of small, local businesses in each of the three regions. Each of these acquisitions has been consolidated into the appropriate regional office.
You have been recruited in to LLA in order to take up the newly created post of senior management accountant. Your recruitment caused some concern amongst the board but was championed by the chief executive officer (CEO) as ‘necessary to stay ahead of the game’. The board have asked that you prove yourself and also give a fresh perspective on LLA by providing them with a report. Initially, you have been asked to provide an assessment of the current financial position of the three regional offices. The most recent management accounts are in Appendix 1. The basic assessment calculations have already been accurately completed by one of the junior staff and the results are in Appendix 2.
As part of the briefing for this exercise, you attended part of a recent board meeting where you were told that the board want your views on the choice of net income as the performance measure for each of the regional offices. They want you to suggest other measures and why they are appropriate for each office. The CEO has advised you that you may want to use different key measures for each office, rather than have a ‘one-size fits all policy’. During the board’s discussion, issues around controllability and responsibility accounting appear to be the main concerns of the board. The CEO also stated that the board would not be interested in a long list of which numbers have gone up and which have gone down. They will want to be given a coherent picture of what is going on at each of the regional offices.
Finally, the CEO said, ‘Well, if you are not completely tired out at the end of this little project then I’d also like you to comment on our remuneration policy at the regional offices including ideas based on your assessment of performance measures.’ Later, the CEO gave you a note (see Appendix 3) describing these policies at LLA.
Required:
Write the report to the board of LLA to:
(i) Assess the recent performance of the three regional offices by interpreting the data given in Appendices 1 and 2. (10 marks)
(ii) Evaluate the choice of net income as the performance measure for the regional offices and suggest other measures and why they are appropriate for each office. (10 marks)
(iii) Using the information provided, evaluate LLA’s remuneration policy suggesting changes as appropriate. (10 marks)
Professional marks will be awarded in question 1 for the format, style, structure and clarity of the discussion of your answer. (4 marks)
Note: the Appendices follow on the next two pages.
Appendix 1: LLA financial data
The figures are drawn from the regional offices’ management accounts for year to September 2012.
Notes:
1. East office data is for the regional office only. It excludes any costs of the head office function based there other than the allocated costs listed.
2. Notional cost of capital at LLA is 9%.
3. Current assets contains only accounts receivable for each office.
Appendix 2: Basic calculations
[These can be assumed to be calculated correctly.]
Notes
1. Other costs and allocated head office costs are fixed.
2. Margins are calculated as a percentage of revenue.
Appendix 3: Note on remuneration from the CEO:
There are broadly five grades of staff at each regional office. The following is an outline of their remuneration packages. (The head office staff are treated separately and are not part of this exercise.)
Senior management
All staff at this level are paid a basic fixed salary, which reflects industry norms over the last few years, plus a bonus dependent on the net income of their office.
Creative staff
The ‘creatives’ are on individual packages which reflect the market rates in order to recruit them at the time that they were recruited. Some are fixed salary and some have a fixed element plus a bonus based on their office’s revenues.
Buying staff
The buyers are paid a fixed salary plus a bonus based on the prices for advertising space that they negotiate compared to the budgeted cost of space. The budget is set by the finance team at head office based on previous years’ experience and their forecast for supply and demand in the year in question.
Account management staff
Account management handles relationships with clients and also develops new clients. They are paid a fixed marketbased salary.
Administration staff
These staff are paid the market rate for their jobs as a fixed salary based on hours worked.
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简述荒诞派戏剧。
Strom Co is a clothing retailer, with stores selling mid-price clothes and clothing accessories throughout Europe. It sells its own-brand items, which are produced by small manufacturers located in Africa, who work solely for Strom Co. The recent European sovereign debt crisis has affected a number of countries in the European Union (EU). Consequently, Strom Co has found trading conditions to be extremely difficult, putting pressure on profits and sales revenue.
The sovereign debt crisis in Europe resulted in countries finding it increasingly difficult and expensive to issue government bonds to raise funds. Two main reasons have been put forward to explain why the crisis took place: firstly, a number of countries continued to borrow excessive funds, because their expenditure exceeded taxation revenues; and secondly, a number of countries allocated significant sums of money to support their banks following the ‘credit crunch’ and the banking crisis.
In order to prevent countries defaulting on their debt obligations and being downgraded, the countries in the EU and the International Monetary Fund (IMF) established a fund to provide financial support to member states threatened by the risk of default, credit downgrades and excessive borrowing yields. Strict economic conditions known as austerity measures were imposed on these countries in exchange for receiving financial support.
The austerity measures have affected Strom Co negatively, and the years 2011 and 2012 have been particularly bad, with sales revenue declining by 15% and profits by 25% in 2011, and remaining at 2011 levels in 2012. On investigation, Strom Co noted that clothing retailers selling clothes at low prices and at high prices were not affected as badly as Strom Co or other mid-price retailers. Indeed, the retailers selling low-priced clothes had increased their profits, and retailers selling luxury, expensive clothes had maintained their profits over the last two to three years.
In order to improve profitability, Strom Co’s board of directors expects to cut costs where possible. A significant fixed cost relates to quality control, which includes monitoring the working conditions of employees of Strom Co’s clothing manufacturers, as part of its ethical commitment.
Required:
(a) Explain the role and aims of the International Monetary Fund (IMF) and discuss possible reasons why the austerity measures imposed on European Union (EU) countries might have affected Strom Co negatively. (10 marks)
(b) Suggest, giving reasons, why the austerity measures might not have affected clothing retailers at the high and low price range, as much as the mid-price range retailers like Strom Co. (4 marks)
(c) Discuss the risks to Strom Co of reducing the costs relating to quality control and how the detrimental impact of such reductions in costs could be decreased. (6 marks)
金融衍生产品、金融工程学等一系列专业技术逐渐应用于商业银行的风险管理，这属于商业银行()。
根据《商业银行资本管理办法(试行)》，最低资本要求，核心一级资本充足率、一级资本充足率和资本充足率分别为()。
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