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alternative methods of raising finance, leasing and other aspects of financial management.
In all these areas, there was heavy reliance on the Finance Department and the
occasional contact with the commercial section of the Burke Engineering bank.
4. Wage statements. The wage system was being computerised to produce automatic
national insurance and pension contributions. This had been successful with the
management wages, which were paid monthly, but there were still problems with the
weekly paid work force. Changes in tax levels and national insurance contributions were
received from national government and would, shortly, be automatically entered for all
employees. There was no review mechanism for pay or overtime payments.
5. Costing. The Finance Department produced quotations manually from information
supplied by the production department. They included a labour charge, raw material costs,
hours of machine utilisation, and an administrative overhead charge. Each was fixed at the
beginning of the year. In theory, management added a standard margin to all projects to
meet the required profitability.
6. Profitability. No assessment of the profitability of individual projects was made. The
company operated an annual plan of allocating total costs of all departments across total
production. Profitability estimates were prepared for the management reports on a monthly
basis, based on forecast movements in costs and revenue receipts.
7. Personnel. All personnel reports were prepared manually. There was no established
programme of personnel evaluation for the Finance Department, and no mechanism for
reviewing training requirements and skill levels. There was a limited appeals procedure,
but no collection of data on absenteeism, discipline or labour turnover.
8. Inventory. The valuation of the inventory was organised manually, every 6 months, from
the records kept by the production department. Raw materials were recorded at the
established annual value; part finished goods were valued at cost, and finished goods at
the price quoted to the customer.
9. Canteen. The canteen kept manual accounts on number of meals served, and raw
material costs.
10. Cost control. There was no procedure for monitoring telephone, telex, heating or
lighting bills, or the use of stationery and other office supplies, or travel expenses.
Production Department
1. Product costing. The production department followed a standard procedure for costing
individual projects, described above (item 5). This procedure was reviewed annually.
Variations were only identified on annually for the new annual plans.
2. Order scheduling. Orders were scheduled manually, and reviewed on an ad hoc basis,
depending on the demands of Production, Finance and Marketing and Sales. An initial
project plan was produced by the Drawing Office, but this was subject to continual and
substantial alterations during the production process.
3. Machine efficiency. There was no method of analysing the efficiency of machinery. All
maintenance was entirely ad hoc.
4. Personnel. All personnel reports were prepared manually. The programme of personnel
evaluation was ad hoc, and no mechanism for reviewing the training requirements and skill
levels within the department. There was a limited appeals procedure, but no collection of
data on absenteeism, discipline or labour turnover.
5. Safety. There was no review procedure for safety issues which mainly relied on
occasional visits of the Health and Safety Executive. There was no collection of statistics
on accidents.
6. Warehouse. The only information about the warehouse was collected through the
manual stock control system. This was not used for management information, but for the
annual accounts. There was no analysis of the warehousing of goods or of how goods
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