“The introduction of Chapter 7 really got me thinking about taking the ‘first step’ and how without taking the first step to success, the future will never become a reality. I related this to myself, and how … I decided to begin a university degree to better ‘knowledge myself’ and for a better future. It made me think about how glad I am to have decided to take that first step and apply at CQU and how it has changed my life for the better. I can see how important first steps are for managers and their decisions in a firm, just like my first step at CQU; for without that first step it would still just be a dream.”
“Honestly, I feel a little bit down in mood to do the steps related to reflection. I think I’m not the kind of person who enjoys reading as a hobby, since I always fall asleep even when I just read one or two pages. However, I have to admit that reading, and understanding deeply about each chapter in the Study Guide is the most essential step if you want to go further in the accounting journey. That’s why I try to regain my energetic mood, and motivation by eating some chocolates before embarking on Chapter 7: Budget for the short term”.
“Before I even get into reading the chapter, just by reading the title I’m already enthusiastic to read this one. Budgeting is something I am very passionate about; I love seeing where my money goes. I have big dreams like anyone else and money is usually the foundation to get there. My family thinks I’m weird because I have a full Excel spreadsheet dedicated to my budget with multiple tabs outlining every small detail you could think of, but hey, I am a business student.”
“I feel like KCQ’s are my ‘break’ moment in accounting. They give me time to reflect on what we are learning and it’s completely okay if I don’t understand what it means because we all have that at some point in this unit.”
Thank you to everyone who has submitted your ASS#2 Step 5.
I have been having a great time reading what you have to say, after you read Chapter 7 of the Study Guide.
We mark each Step on the readings progressively harder (as people get more of an idea about how to write their Key Concepts and Questions: KCQs). As a result, although the standard of your Step 5 is usually quite a bit higher than for your Step 2, the average mark is usually similar.
“There were times when I actually ‘caught’ myself reading it as Martin wanted me to… as though it was a book, rather than something I was supposed to be consciously taking in and making notes about 😊.”
How to write KCQs
Quite a few past students contact me over the years (I usually get an email most weeks – and I love to hear from past students) updating me with what they are up to and telling me how useful in their work (and life) they have found what they have learnt in the past units they have studied; and quite often they refer to learning how to read critically using the KCQs approach as being a particularly important skill they gained from our unit.
Most people now have the idea of not simply writing a summary of other people’s ideas (such as those of the author of the reading); but instead, also giving their own responses and opinions to the key concepts in the reading, as we seek to develop our own understanding and personal meaning of these concepts. Here is a comment from a past student:
KCQ’s have been such a big help in my current role. I work in the restructuring advisory department of an accounting firm and deal with various restructuring issues as well as personal and corporate insolvency. It involves accounting (obviously) but also a lot of law which is an area I find quite difficult.
It doesn’t matter if I can recite definitions or legal text (I have never been asked to recite a definition in my job to date), what matters is my understanding of important concepts, applying those concepts, and my opinion of them (especially when preparing advice for clients). Quite often I’ll be given a task and after doing my research I will talk through my KCQ’s with my managers to ensure I have the correct understanding. This is where using examples and asking questions is great as it gives my managers an idea of what I do and don’t know and allows them to help build upon my pre-existing knowledge.
Other times I’ll work through my KCQ’s on my own but will write down any questions to discuss with my colleagues who are more experienced.
Getting into the habit of clearly outlining key concepts with examples has also been fantastic when others ask me for help or advice. It has enabled me to better my communication skills especially when dealing with complex tasks that have serious legal ramifications.
So although KCQ’s in ACCT11059 can be difficult, mentally draining and time consuming they have definitely been a huge help to this accountant 😁
An area many people could focus on in their ASS#2 Step 6, is to clearly and carefully describe in your own words some of the key concepts, using examples from your prior knowledge and previous experience to illustrate your understanding. Then, you can focus on communicating to me your opinions and responses to some of the key concepts, supporting your opinions with evidence and reasons from your prior knowledge and previous experience:
“When reading the study guide, my mind is constantly trying to relate what is being read against something in my own experience. This helps with determining what I do and don’t understand from it.”
Experience with budgets
Most people said they have had some personal experience with budgets, which may often not have been all that favourable. And this is with budgets not just in the workplace but also in our personal lives. And as we progress through term, people are often saying that more is starting that more about budgets is making sense to them:
“It is amazing … how much I have learned. The unit is definitely hands on, although I know I have a long way to go. Just look at the budget for [my] department, I am able to understand a lot more … than prior to doing the unit. Basically, prior to the unit nearly everything seemed double Dutch to me…”
Indeed, quite a few people have described new developing insights about aspects of accounting that they are discovering:
“It was not until the end of the first page that I really got the gist of what this chapter was going to be about. The chapter is about effective communication and how managers can communicate their plans for the firm by using such things as budgets to make sure that the objective of the firm is conveyed to their co-workers properly.”
Others have commented about the illustrations and have thought further about the concepts being described:
“When reading the illustration about the baggage, I wondered why it was relevant to budgets. But then I related it to planning. A manager’s job is not only to set a whole bunch of objectives and delegate them accordingly, but also they need to be really careful about what specific goals and targets they are setting. SMART goals come to mind when I think of this; it was something I learnt in my STEPS course.”
Others have been developing further insights about the usefulness and effectiveness of accounting:
“If I’ve learnt something … it’s that Accounting really is used in everyday life and is essential to guide, monitor and regulate every business.”
Purpose of budgets
Quite a few people expressed surprise that budgeting was more than just some numbers, but that there was a purpose behind budgets to seek to influence people and achieve outcomes for a business:
“I had [not] given thought about how applying a budget can actually influence those involved, through motivating them, encouraging communication, co-ordination and delegation.”
Many people discussed the potential roles of budgets and had a range of views of their effectiveness in practice:
“Advantages [of budgets] such as promoting and enhancing co-operation, co-ordination and communication between … staff and sectors of the firm are … fundamental …to … motivation and job satisfaction which I believe to be a key to improving productivity …. A budget can provide a way for managers to express their plans to workers. If the plans are clearly understood, this is strategically beneficial to the company as responsibility and accountability for … tasks can be delegated.”
Quite a few people questioned the value and usefulness of budgets for motivation:
“I am not entirely convinced a budget would automatically assist a manager to inspire his or her team. Can we really suggest a young casual team member whose main motivation for being at work is saving for ‘schoolies’, could be the slightest bit interested in the consequence of his manager not reaching budget? Ultimately, I struggle to see how people in general can be motivated to make money for others.”
The Heathrow Airport baggage handling illustration was a popular story with many people; and quite a few people have had similar experiences in the workplace:
“I loved reading the example of Heathrow airport. I’ve seen so many examples of this working in a call centre. “Playing the game” is dangerous to a business, for customers and, in my experience at least, employee engagement … There was a great example of a call centre agent I knew that was smashing his target for average handling time (AHT) of calls. He was praised daily for his efficiency and rewarded accordingly. When someone finally listened to his calls to find out how he was so quick, they found that he would say nothing when customers came through and just wait for them to hang up. Needless to say, that wasn’t what senior managers were looking for when they set targets for AHT of calls … The question I always used to have was why do marketing/senior management make these decisions in the first place? Why would they do so without consulting the people who are having the conversation with customers? In a lot of these cases, someone at that level could have told them it wasn’t a good idea.”
Budgets: Communicating & coordinating
Some people agreed that budgeting could have a role in communicating and coordinating within an organisation:
“I completely agree with everything the author has said in the paragraph about coordinating. It is so important to be able to communicate to your fellow co-workers to be able to get the job done … I never thought a part of communicating effectively would involve budgets. But it makes complete sense when you have a set amount of money to be able to achieve the goal you all have to work together and communicate effectively; to do so otherwise, you will go over the budget and you will have effectively failed your goal.”
And some people are developing an understanding that budgets can be a way of visualising the short-term future of a business; just a few steps ahead:
“Budgets represent a future virtual world for the firm. They can help us anticipate events: I thought this was a clever concept and it just “clicked” with me for some reason. I don’t think I had consciously thought of budgets in this way before. Maybe it’s because virtual reality has become ‘normal’ to us now, but while reading I could think of the budgets I use at work and actually visualise how these could be transformed into a physical reality … I have been looking at budgets quite differently since. It’s like they have become 3D 😊.”
Connecting concepts with other units
And some people connected what they were reading with what they are studying in other units this term, deepening and strengthening their understanding of some of the concepts we are studying in this chapter:
“…as the benefits of budgeting are reliant on others, these benefits can vary from workplace to workplace. As I learnt from my Organisational Behaviour unit, every person can be expected to react to situations differently; all people in a business won’t react exactly how it is expected to make budgeting beneficial. This doesn’t necessarily mean budgeting won’t work for all these workplaces; managers should just expect these benefits to differ and sometimes be inconsistent.”
And what we are studying in our unit can help us with what we are studying in other units as well. And why might this be? Well, because business is business. And all the business disciplines inter-connect with each other as they each help us understand and think about aspects of the integrated puzzle and challenge of succeeding in business. In this way, all the business disciplines are important; and are part of a coherent whole:
“Another unit that I am doing this semester is Organisational Behaviour. One of the assignment pieces for this unit is on the topic of how managers can motivate employees and their role in the workplace … it looks like this chapter could possibly help me for this subject as well.”
Quite a few people commented that they did not understand how ‘Purple Chocolates’ could budget to make a cash loss and yet also budget for a large profit:
“I was also confused … where [Purple Chocolates] … have [budgeted to lose] cash of up to $325k but still managed to [budget for] a profit of $825k at the same time. To me this doesn’t make sense…”
This is something we will look at in class. Once you understand how this can happen, you will have a good understanding of how accounting is based on accrual accounting and exactly what this means.
Opinions based on previous experience
Many people are engaging well with some of the illustrations of the key concepts, expressing their opinions and responses supported with their prior knowledge and previous experience:
“One thing that stood out to me … was the story about Dixon Street in New Zealand. At first I was amused by what had happened because it is a classic mix up but then it really made me think about how people could finalise the decision without actually visiting Wellington… I have personally experienced this myself in a job I used to have where the ‘big boss’ made many decisions for the shop but rarely made a visit to react to problems first hand. Amongst the staff the disagreement from this decision would always cause dramas and upsets and it just goes to prove that sometimes decisions need a second opinion from the workers further down the chain.”
And many people are gradually developing their critical reading skills:
“Overall I am gradually getting use to the author’s style of writing and taking more and more in after each chapter. Personally I hate reading, so I am glad that this task forces me to stop and think about how the topic makes me feel. I am also using this method in other classes to really understand what the textbooks are saying.”
Budgets: Help or hinder?
And a number of people are developing their view about whether budgets can help, or hinder, managers to better connect to and engage with their business:
“The potential benefits of budgeting are coordination, communication, delegation and motivation: …When used as intended, by someone who is good at managing and leading others, a budget can set the direction for a workplace, and help staff achieve the desired outcomes. The potential is reliant on people to drive and achieve the results.”
And many are realising that accounting can tell ‘stories’:
“Martin’s question of ‘Can accounting really help, or is it more likely to hinder, managers to communicate their plans and ensure the resources of their firms are used in the short-term in a way that is consistent with their plans?’ is interesting and a similar line of thought as discussed in previous chapters. It is one that I am answering much differently now, than I was at the beginning of the unit. I can now clearly see that numbers in budgets and financial statements can communicate a story, but not necessarily the truth, or [at least] is open to interpretation.”
Time to study
Also, quite a few people are struggling with inadequate time available to spend on their studies in our unit; with many people having expectations of spending less time on the unit than the unit has been designed to take:
“Although I still don’t love accounting, I am finding it easier to understand every week; the issue I am having trouble with is trying to find time to study with full time work and a healthy social life.”
A final word
And to end, here are two people’s views about what Chapter 7 of the Study Guide was all about:
“From reading Chapter 7, I have had my views reinforced … that we need goals (budgets) to keep us motivated, on track and successful in the work place. After reading this, I am now in my spare time constructing a proposal to my own line manager to work more closely in constructing a budget that is actually achievable for my store. With achievable budgets in place, I’m confident that we will be able to see a higher rate of productivity while also seeing which sectors we need to truly improve on and hold accountable for results. This information has truly put into perspective how much time and effort goes into creating these budgets to keep the money rolling in to businesses! To wrap up [here is] a quote that resonates with my views on short-term budgets strongly:
‘…A budget is not just a collection of numbers, but an expression of our values and aspirations.’ ”
” ‘I have a dream’. When I began to read this chapter the famous ‘I have a dream’ speech by Martin Luther King Jr, came into my head. [These four] words stuck with me for the rest of the reading. As I read through the chapter I found that the author was presenting a large number of concepts that didn’t seem to make sense, but … when I finished the reading, [I found] the concepts … all tied together and … reinforced the same idea. Just like [in] Martin Luther King Jr’s speech, he asked for help and wanted people to join together to achieve his dream. This is like in a firm, managers have dreams and ideas … to achieve these, help is needed. The first steps must be taken in order to begin achieving the goal. This is what I think the author is trying to say. In terms of business and accounting, budgets are a tool to use to assist with achieving the manager’s dream. Managers plan, communicate, lead employees, motivate, connect with people on [a] personal level, and are clear about the plans for the future. Budgets can help do this.”
Thank you for all your contributions in your ASS#2 Step 5.