topic: Professional Accounting €“ Contemporary Accounting Thought

COURSE ACCT 2111
Contemporary Accounting Thought
Semester Two 2012

Case Study Assignment  (Worth 10% of ACCT2111):

The individual assignment must be delivered via online Blackboard submission no later than 11.00am on the Thursday of Week 10

this semester. All assignments should be marked to the attention of Dr. Michael Kend and have attached the assignment cover

sheet signed by you. Hardcopy submission also required. Completing a Turnitin Report does not constitute an online

submission. This is done only via the Blackboard.

Imagine that you are the proprietor and manager of a small manufacturing firm in Mornington VIC. Currently, the business is

organised as a one-shareholder company (you are the shareholder), which has 9 employees engaged in clerical and production

tasks. In raising the funds necessary to start the business you relied entirely on personal savings, and thus far the only

additions to the financial structure of your firm have been in the form of trade credit. You have visions of gradually

expanding your plant over the next 10 years to become the dominant supplier of your product in the southern half of

Australia. This will involve your firm expanding its scale of operations by a factor of 10. Carefully identify the range of

agency relationships already present in your firm, and those that are likely to arise as your firm expands.
Required:

Q. What is the nature of the costs likely to arise from these relationships and what mechanisms may be employed to economise

on these costs (you will need to specific in relation to the mechanisms employed to control each type of agency

relationship).

Submission of the assignment (hardcopy):

€¢    Individual Assignment Cover sheet (signed by you).
€¢    Turnitin Report attached.
€¢    Title, and your Name, ID number.
€¢    Bibliography, Appendix (if required for tables). Appropriate referencing is required.
€¢    Word limit: up to 1300 words.