Question

Discuss how the pandemic is (or might be) affecting actual companies from a managerial accounting perspective considering the concepts we've covered in this course. For example, how might it affect a company's planning and performance evaluation processes? How might it affect ABC or other cost assumptions, break-even analysis, or future planning? You may want to think about disruptions in supply and demand, production operations, supplier and customer relationships, for example. You may use actual companies you are familiar with from interactions during this time, ones you've read about in the media, or ones you work with. Provide examples to illustrate your understanding of course concepts.

Answer 1

The whole world is groaning under the impact of the rapid spread of the pandemic COVID-19, which has struck more than 160 countries and killed thousands of people.

No one knows as yet the extent of the economic impact of the pandemic.The disruption of supply chains originating from or going through china, the rush to purchase goods in anticipation of health curfew restrictions, and the possible disruption of the labor market in many countries, all of these will have a resounding negative impact on production and consumption on global economic growth in 2020 and even in 2021.

During a time of crisis, it can be difficult to operate business as usual.Amidst the uncertainty managers faces the challenges of being pulled in different directions-from managing communications and crisis response planning, to maintaining some level of continuity of business operations.

Pandemic is impacting the planning of the company, such as a pandemic , company must plan for workers being unable to report to work for a period of time.It is important to plan to have to have core business activities to remain operational for several weeks or months withh limited staff.

Performance evaluations help measure employee's achievements against goals and expectations and determine performance standards across different types of roles and levels. When deciding what to do during a time of crisis a company should delaying employee performance reviews and promotion.

Break even analysis is an important aspect of a good business plan, since it helps the business determine the cost structure,and the number of units that need to be sold in order to cover the cost or make a profit.In this scenario company try to cover atleast only cost to sustain in the market, preservation and survival of organization will be depdnd on their ability to maintain cash and liquidity.

pandemic forces many companies,and entire industries to rethink and transform their global supply chain model .It has already exposed the vulnerabilities of many organizations,especially those who have a high dependence on china to to fulfill their raw materials or finished goods.The sectors that will see positive impact include remote communications;online media,online retail;sector that benefit from supply chain relocation.

Many countries are facing similar issues as consumers conserve their financial resources for necessities.Social distancing and the closure of nonessential retailers is also dampening demand.Demand in ecommerce is ramping up.Due to change in demand impact both on supply and production of company because these are interrelated.These also affect supplier and customer relationship.Boost supply , not demand, during the pandemic .

Reliance Industries may have set the bad news ball rolling for corporate India employees.The conglomerate headed by India's richest man,Mukesh Ambani, on April 30, annoounced salary cuts for a section of its workforce in the wake of the coronavirus outbreak and subsequent national lockdown.Those in the behemoth's hydrocarbon business earning above $19806 (Rs.15 lakh) a year will face a 10% pay cut and senior executives will see income slashed by upto 50%, according to a letter by RIL executive director Hital Meswani. Chaiman Ambani himself is forgoing his entire salary for the year.

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