Advanced Management Accounting

Langfield-Smith, K; Thorne, H & Hilton,R. Management Accounting 6E, (6th ed). McGraw-Hill

Hilton, R.W. (2010). Managerial Accounting – Creating Value in a dynamic business environment. (9th ed.). McGraw
– Hill, New York
Allulite Windows and Joinery is a manufacturer of aluminium doors, windows and other joinery products for
residential and commercial applications. You recently visited Allulite’s production facility in East Tamaki to
gather information regarding their manufacturing processes.
The company has a number of factory staff who are paid an hourly rate and expected to meet minimum production
targets. Office staff are paid salaries and sales staff are remunerated via a base salary plus a performance
bonus based on sales targets. Senior managers are all shareholders in the company and, as well as drawing
reasonable salaries, all share in the profits the company makes.
Senior management are reviewing the way they review and compensate their workers and have heard that you have
been studying financial and non-financial performance measurement systems. They wonder whether incorporating
some non-financial performance measures into their decision-making might add value and have asked you to
complete a report to them identifying whether a measurement reporting system such as the Balanced Scorecard
might help them.

Write a REPORT to Bruce Mason, the managing director of Allulite which:
a) Identifies and describes a range of performance measurement metrics that might be appropriate to
Allulite
b) Explains the value of combining both financial and non-financial measures
c) Provides a Balanced Scorecard specifically for use by Allulite
d) Identifies and explains the pros and cons of the BSC and its implementation
e) Recommends, to Bruce whether to adopt a BSC at Allulite.

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