An integral part of all companies irrespective of its size is financial accounting. This is because financial accounting helps a company in the communication of financial information externally. According to Khan (2015), financial accounting is also important in an organization, as it helps it in recording the economic transactions that the organization has performed during the past years. However, in the recent scenario, the recording and management of financial transactions of a business has become quite difficult. As a result, companies have started adopting and using various types of accounting software such as Xero, SAP, MYOB and others. According to Kabir et al. (2015), accounting software are the computer programs, which enable a company ion managing its financial business transactions. This software functions as the accounting information system in the company that has adopted it.
This report has been prepared during the tenure of service in Bain & Company, a consultancy firm in Australia. It has been prepared during the evaluation of the accounting system of Fortescue Metals Group Ltd, as the CFO of the company considers that it needs to make an investment for acquiring an accounting software, which will be helping the company to take its business to the next level. In this report, the business requirements and system requirements of the company will be analyzed along with discussing the selection of the software and the vendor of Fortescue Metals Group. It will be recommending an accounting software to the company along with stating the most suitable vendor for the company.
The Fortescue Metals Group is an Australia-based company and a global leader operating in the iron ore industry across the world. The company had been founded in the year 2003 and is operating in the mining industry since then. It has holdings in Western Australia’s Pilbara region for more than 87000 kilometers, which makes it the largest tenement holder of Australia, even larger than both Rio Tinto and BHP Billiton (Fmgl.com.au, 2018). The products that the Fortescue Metals Group produces include steel and iron ore. It has several mining projects, which include Atlas Iron, BC Iron, Eliwana Project, Solomon Hub, Christmas Creek, Couldbreak and Chichester Hub. Fortescue Metals Group has an extensively built infrastructure with a mine of 260 kilometers, railways with 240 wagons, with an operating fleet with eight iron ore carriers (Fmgl.com.au, 2018).
The continuous and sustained delivery of output from the Ore Processing Facilities or OPFs of Fortescue Metals Group has allowed it in continuing the optimization of the company’s product strategy through the medium of enhancing the beneficiation and blending, reduction of impurities and improving iron upgrades in the Chichester Hub of the company (Fmgl.com.au, 2018). On the other hand, the operations at the Solomon Hub of Fortescue Metals Group is the company’s valuable source of production, as it operates with low cost Firetail ore and low phosphorus Chichester ore for creation of high quality blended iron ore (Fmgl.com.au, 2018). The operations of the company in Hedland is also a major part of its business activities, as the port facilities and designed rail facilities in Hedland are constructed for delivering iron ore from its mine to the port in Hedland, which is further delivered to customers. Fortescue Metals Group’s Eliwana Project utilizes latest technologies, design efficiency and autonomous trucks for mining and railway (Fmgl.com.au, 2018). In these ways, there are several business activities of the Fortescue Metals Group, which makes it a global leader in the industry of iron ore.
According to Rosemann & vom Brocke (2015), the key business processes of a company are the procedures that it uses for executing its strategy. In Fortescue Metals Group, the key business activities include mining, extracting ore from iron through magnetic rollers, beneficiation and blending of the ore, reduction of impurities and improving iron upgrades. However, in order to perform these activities, the key business processes of the company are required to be performed. The key business processes of Fortescue Metals Group are as follows -
· Identification of the major support and operational processes such as extracting ore from iron through magnetic rollers, beneficiation and blending of the ore, reduction of impurities
· Assigning the managers of these processes at individual hubs and agree on targets
· Conducting audit to ensure process efficiencies
· Organizing the process benchmarking activities
· Devising innovations and bringing about process improvements
· Conducting an efficient accounting and financial report process
The businesses processes of a company play a major role in achieving its business objectives (Jeston, 2014). In the context of Fortescue Metals Group, the business processes play a considerable role in accomplishing business objectives. The outcomes that are required from the processes of Fortescue Metals Group stated above are to execute all the business activities of the company in a proper and systematic manner. The effective working of the business processes of Fortescue Metals Group will be ensuring that the company’s business activities are being performed and executed optimally. The efficient accounting and financial reporting process, which is a key business process of Fortescue Metals Group, has the outcome of evaluating the financial health and performance of the business.
However, with the medium of conducting an efficient accounting and financial reporting process, the organization will be able to accomplish Fortescue’s another business objective, that is, providing a view of its financial performance and position to all its stakeholders. It will also be able to measure and evaluate its own performance with the outcome of this business process. In case if the company is able to ensure that it will be able to achieve its outcome, it can also be achieving its mission and key business objective of being the lowest cost, safest yet the most profitable mining business.
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