Methodological basics of accounting engineering for Ukrainian enterprises

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Kyiv National Economic University named after Vadym Hetman

METHODOLOGICAL BASICS OF ACCOUNTING ENGINEERING FOR UKRAINIAN ENTERPRISES

Inna Herasymovych Dr. Sc. (Economics), Associate Professor

Iryna Kryshtopa Dr. Sc. (Economics), Professor,

Olha Fedorchenko Ph. D. (Economics), Associate Professor

Kyiv

Abstract

accounting engineering enterprise economic

Aggressiveness of modern business environment highlights the problem of substantiation of theoretical, organizational and methodological principles of accounting engineering, as accounting and analytical support for the economic security system of domestic enterprises. Purpose. The research is aimed at the development of stages of improvement of methodological approaches to the application of the latest economic mechanism - the practical implementation of accounting engineering into activity of Ukrainian enterprises. Methods. Methods used in the article are based on the dialectic of cognition, which allows to assess the effectiveness of accounting and analytical support for modern enterprise management. In particular, the following methods were used: scientific abstraction, synthesis, induction and deduction, modeling, tabular method, as well as methods of logic. Results. The obtained results are presented by the methods of accounting engineering for accounting and analytical data support by means of formation of complex accounting objects: 1) in the field of production - as combination of procedural budgeting, normative method of accounting, procedural operational and cost analysis of deviations with reflection in the daily register of accounting “Report on fulfilment of budgets by business processes of responsibility centers” in order to ensure operational regulation of production consumption of material and labor resources and funds; 2) in the financial field - by daily grouping ofcash and financialflows by types of business processes on risk, liquidity and solvency in other separate monitoring registers - “Derivative balance sheets'” in order to establish current and future level of net assets and net liabilities, as indicators of the level of risk activity of enterprises. Also, the research substantiates practical aspects of the methodology of accounting engineering as a new direction of accounting and analytical support for management and control of the enterprise with a specifi c focus on business processes involving in-depth objects of accounting.

Keywords: economic security, business processes, accounting engineering, accounting engineering tools, operational accounting registers, net assets and net liabilities.

Анотація

Герасимович І. А. доктор економічних наук, доцент, професор кафедри податкового менеджменту та фінансового моніторингу Київського національного економічного університету імені Вадима Гетьмана, Київ, Україна

Криштопа 1.1. доктор економічних наук, професор, професор кафедри податкового менеджменту та фінансового моніторингу Київського національного економічного університету імені Вадима Гетьмана, Київ, Україна

Федорченко О.Є. кандидат економічних наук, доцент, доцент кафедри податкового менеджменту та фінансового моніторингу Київського національного економічного університету імені Вадима Гетьмана, Київ, Україна

МЕТОДИЧНІ ОСНОВИ БУХГАЛТЕРСЬКОГО ІНЖИНІРИНГУ ДЛЯ УКРАЇНСЬКИХ ПІДПРИЄМСТВ

У сучасних умовах господарювання, що характеризуються загостренням конкуренції, а також мінливістю й агресивністю бізнес-середовища, виникає нагальна потреба в розробленні нових підходів до обліково-аналітичного забезпечення прийняття управлінських рішень на вітчизняних підприємствах. Одним із напрямів її вирішення є використання бухгалтерського інжинірингу. З огляду на викладене, а також ґрунтуючись на результатах проведеного дослідження, у статті запропоновано нові методичні підходи до обліково-аналітичного забезпечення управління бізнес-процесами на підприємствах України. Надані пропозиції дають можливість перетворити бухгалтерський облік із фіксатора господарсько-фінансових операцій на ефективний механізм управління сучасним суб'єктом господарювання.

Ключові слова: економічна безпека, бізнес-процеси, бухгалтерський інжиніринг, інструменти бухгалтерського інжинірингу, оперативні облікові регістри, чисті активи і чисті пасиви.

The main text

Instability and aggressiveness of modern business-environment cause an urgent need for a significant reorientation of management and control objects to business processes. In turn, business processes, from the point of view of scholars in the field of accounting, are a complex object of information, which combines: in the production sphere - process budgeting, normative method of accounting, operational and cost analysis of deviations, and in financial sphere - the impact of various risk factors on cash flows. This has led to the development of the latest method of accounting and analytical support for the management of a functioning enterprise (including ensuring its economic security) - accounting engineering. It is based on an engineering approach to modeling, design, development and integration into a single complex of accounting system of various economic instruments.

General theoretical and methodological principles of accounting engineering have been studied in a number of scientific works of foreign scholars such as D. F. Marshal, Vipul K. Basal [1], M. Hammer, D. Champy [2], H. J. Harrington [3], A. A. Thompson, A. J. Strickland [4], C. Redhead, C. Hughes [5], K. Drury [6], J. D. Finnerty [7], V. M. A. Akhtar [8], C. Hongren, J. Foster [9], B. Andersen [10], H. Bredrup [11], A. Rolstadas [12], J. Peppard, P. Rowland [13], R. G. Anthony [14], E. J. Kane [15], G. Dufey [16], F. S. Mishkin [17], T. Kim [18], P. F. Druker [19], D. W. Edwards [20], P. Per-Gaute [21].

N. Horodyska [22] carried out the generalization and review of concepts of engineering, systematized and explored points of view of various economists. Some domestic scholars in their works have considered accounting engineering as an accounting technology, in particular R. Brukhansky [23], І. Herasymovych [24], I. Zamula, М. Prodanchuk, Т. Kovalchuk, А. Myhalkiv, К. Simakov [25], V. Makarovych, O. Sydorchuk [26], І. Nahorna, О. Chumak [27], І. Yukhymenko-Nazaruk [28]. In their works these economists disclosed the essence and meaning of accounting engineering, investigated and learned retrospectives of its development, described basics of mechanism of functioning and tools of accounting engineering. Their works are also focused on the possibilities of accounting engineering in the context of management decisions.

Scientific work by M. Shumeiko, E. Kuznetsova, I. Tkach [29] investigates and generalizes main basics of functioning of accounting engineering and proposes engineering theory of accounting with own subject and objects. In addition, these economists have proposed an engineering method of accounting.

Some issues that touch upon reporting in frames of certain elements of accounting engineering were disclosed in the work by A. Kukoba [30] and L. Kindratska [31].

Currently there is no method of accounting engineering in Ukraine, which is adapted to peculiarities of market relations in Ukrainian enterprises. Only some of domestic authors, namely S. Holov and V. Iefimenko [32], І. Kryshtopa [33], S. Lehenchuk [34], V. Zhuk [35] made an attempt to cover general approaches to such problem, however in methodological, and, thus, in organizational terms, it is not resolved.

The purpose of this research is to develop the way of improvement of methodological approaches to application of the latest economic mechanism - the practical introduction of accounting engineering into activities of Ukrainian enterprises.

The research hypothesis of the study provides that an important aspect of the enterprise's economic security is the development of methods of accounting engineering for accounting and analytical data through the formation of complex objects of accounting in the field of production (as an organic combination - process budgeting, regulatory accounting method, process operational cost analysis deviations reflected in the daily register of accounting in order to ensure the operational regulation of production consumption of material and labor resources and cash) and in the financial sector (by means of daily grouping of cash and financial flows by type of business processes on risk, liquidity, solvency and other separate monitoring registers of accounting for establishing current and future level of provision of the enterprise with net assets and net liabilities as indicators of the level of risk activity of enterprises).

A new stage of the scientific and technological revolution, which has been started in late 1980s, the deepening of globalization of the economy, and fierce competition have led to the need for fundamental change of priorities of management and control: in production sphere - to technological processes that consume resources in cost items that only summarize them, and in financial activities - for continuous business processes in which risks arise, reserves are created, liquidity, solvency, etc. are determined.

Fundamentally new mechanisms and accounting tools based on the engineering approach to their formation are needed in order to provide information to the business process management system.

From the time of Luca Paccioli until the beginning of the last century, eight traditional elements of the method were used in the accounting system: accounts and double entry, balance and reporting, documentation and inventory, estimation and calculation, which by the end of the last century began to be filled with engineering content. In particular:

- appearance of aggregate (complex) mega-accounts and aggregate integrated correspondence of accounts, use of market and fair valuation, electronic document management and reporting, development of the latest accounting registers and control methods, namely: daily Report on fulfilment of budgets by business processes of “responsibility centers” in the production sector and “Derivative balance sheets', which do not only show the real situation in terms of risks, reserves, liquidity and solvency, but also forecast their level based on future hypothetical processes;

- multidimensional application, in the management of economic processes of algorithms, matrices, models, derivative balance sheets, time and space factors of quadruple and sixfold records, aggregate accounting correspondence, indicators of net assets and net liabilities (according to market and fair value assessment) in the work of the enterprise.

Such directions of accounting development have led to the formation of its engineering system, which is typical for the current century and aimed at ensuring effective management of objects and processes at the business process level with the use of engineering aggregate mega-accounts built into computer programs of management accounting and strategic accounting.

Thus, accounting engineering is a set of developed new methods, techniques and schemes, as well as accounting records that ensure the implementation of new projects and transformations. In other words, this is a new accounting mechanism that uses all its tools to manage economic processes as an object of accounting.

Such methodological innovations, in accordance with the economic realities of the current century in accounting engineering, developed in countries with highly developed market economies, are the basis for their application in Ukrainian enterprises, where its feasibility depends mainly on the simplicity of its methodology.

Considering foreign practice and experience gained by some domestic enterprises, we have taken into account this factor and offer a fairly simplified (compared to foreign counterparts) methodology of accounting engineering, which provides full information about business processes for operational control and management regulatory and preventive measures, both in the production and in the financial sphere of the functioning Ukrainian enterprise.

During the study it was found that the most typical business processes of main production shops as “centers of responsibility” are: in the food industry - “Receiving raw materials”, “Washing raw materials', “Mechanical grinding and pressing', “Cooking”, “Packaging”, “Labeling”, “Packaging in sales containers”; in mechanical engineering, instrument making and furniture manufacturing - “Debugging equipment”; “Procurement (supply) of raw materials”; “Production transformation (consumption) of resources”; “Installation of products”.

Necessary and obligatory condition is budgeting of business processes by “centers of responsibility” for the production of relevant products, without which management of business processes is impossible.

Each, separately taken, technological business process is a separate complex object of accounting, which combines: in the production sphere - budgeting tools, regulatory accounting methods (“standard cost” or “direct cost”), process operating cost analysis of deviation indicators. This allows to create a comprehensive mechanism for combining (engineering approach) of mentioned tools, which is presented in an expanded and in-depth form as “Report on fulfilment of budgets by business processes of responsibility centers” on the level of use of material, labor and financial resources in the process of manufacturing of various types of products in the shops of the main production of industrial production. It was tested on the example of PJSC “Bila Tserkva Cannery” in Kyiv region (Table 1).

This report both provides management with information on the level of budget execution by type of product and specifies the role and impact of each of the business processes for quick regulation the level of costs that shape these budgets. And this is achieved even at the level of usual computer software of 1C type and creates conditions for affordable usage of accounting engineering techniques at Ukrainian enterprises.

An effective method of internal control over technological costs in business processes of industrial enterprises is the use of methodology of their operational and cost analysis. It works by means of structuring the costs of technological redistributions as business processes, and comparing cost options for different types of technologies used, and thus establishing the level of cost-effectiveness of the respective types of technologies (Table 2).

Data in Table 2 show the effectiveness of the methodology of operational and cost analysis of technological business processes, as one of the tools of accounting engineering, as when comparing different production technologies, it is possible to choose the most economical one. The methodology is of practical importance as a direction of in-depth control over business processes, but not only of “centers of responsibility”.

Through the transfer pricing mechanism, it is possible to determine the contribution of each “center” to the results of the enterprise as a whole, as well as other structural units related to its activities.

It is carried out with the help of appropriate methodology of accounting engineering, which takes into account and groups, according to complex accounting objects, different types of cash flows, where the swift information elements are:

1) identification and classification of business management processes as “centers of accounting for financial situations',

2) aggregated mega-accounts and aggregated correspondence of accounts on the principle of double entry,

3) accounting registers - daily monitoring transformation “Derivative balance sheets',

4) net assets as indicators of the level of risk in the enterprise, defined in the monitoring, transformation derivative balance sheets.

Table 1

Report on fulfilment of budgets by business processes of responsibility centers of fruit and vegetable canning enterprise PJSC “Bila Tserkva cannery” of Kyiv region

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