Cost Management and Analysis 22753 ASSESSMENT ITEM 2: GROUP ASSIGNMENT

Cost
Management and Analysis #22753

ASSESSMENT ITEM 2: GROUP ASSIGNMENT
(Group Component)

Weighting: 20%.

Autumn 2014

1. OVERVIEW

Your group is to perform the financial analysis
(feasibility study) outlined in Attachment One of this document. The analysis
is for UTS management (i.e., your CMA Lecturer).

Unlike earlier semesters, this assignment allows
you to do analysis on a project which if successful, may actually be
implemented by UTS. Details of the assignment and some background information
are available in the attachments.

Your group must submit and present your financial
analysis in three formats:

A. Excel – financial modelling
B. Word – written report

C. PowerPoint – for presentation in?class (5 minutes
per group).

Extracts from the financial modelling are to be
included in your Word report and PowerPoint presentation.

A key factor to keep in mind is that a
feasibility study is not as detailed as a full business plan. Hence, you have
discretion as to what information to keep in the body of the report and what
information to exclude. A key part of this project is that it requires you to
identify and obtain the relevant information via research, analysis and
estimation. You need to only include information relevant to decision?making in
the report.

2. EXCEL

UTS management (i.e., your CMA Lecturer) will
review your financial modelling. He will need to be very comfortable with your
technical execution. Like many senior managers, he is extremely time poor and
needs to be communicated to very concisely. He needs to quickly understand the
design of your models, as well as assumptions and limitations.

You will email your Excel file to your lecturer
for review.

Here is what he will expect to see:

The model is clearly structured, with supporting
tables in separate tabs that build?up from a detailed breakdown.

Input and output tables are clear and separate.

Tables logically present key components (e.g., costs, benefits,
assumptions and parameters). The model is materially complete and
comprehensive.

The model is technically correct, e.g., cash
flows are on an after?tax basis and treatments are conventional.

Excel extracts used in the written report or
PowerPoint presentation should be appropriately formatted, e.g., present
figures in $M (e.g., $0.18M for $180,000).

3. WORD

Remember, the UTS management is your audience and
they face budget constraints, so focus on the numbers. It should be very clear
what the document is about, what the analysis implies, and what recommendations
you are making (if any) for future progression of the initiative. Include
evaluation of how the initiatives are aligned with the ‘corporate’ strategy.

You will lose marks if you include superfluous
information in the report. He is highly knowledgeable about the business
generally (e.g., its strategy and structure) and will be irritated by time
wasted reading an unfocussed report (although he is often unfamiliar with
operational issues). He wants the report to present only pertinent information
and key aspects of the financial modelling.

This is a business style report for a
non?academic ‘insider’. It must provide concise and easily readable information
to aid decision?making. It must include explanation of major conceptual points
with simple definitions and explanation of relevant terminology (especially
operational matters) and complexities).

You MUST INCLUDE an Executive Summary. It will be sent to the UTS decision makers so
it must becomprehensive and describe the ‘big picture’ and the main
‘numbers’ (e.g., net savings, Capex, NPV, IRR). The structure should also
include Introduction, Discussion of Key Findings, and Conclusion.

Your report must:

analyse and discuss the information, and evaluate
it critically. identify problems and suggest solutions.

speculate about future trends and impacts.

The writing style must be a non?academic
report ? see the Guide to writing assignments issued
by the UTS Business School: http://www.uts.edu.au/current?students/business/study?and?assessment?
resources/developing?your?academic?writing#guide?to?writing?assignments.
An appropriate formatwill include headings,
sub?headings, bullet?points, tables and figures. It must be easy for readers to
understand the structure, and be able to selectively read sections of the whole
report rather than the whole thing from start to finish. Although the report is
to be in a non?academic style, you must reference appropriately and you must
not plagiarise.

4. POWERPOINT

Remember, the UTS management is your audience,
and their main interest is in the numbers!!! Your presentation must include
Excel extracts, headline statements and all critical information including:

Financial information; Capex, NPV and IRR.

Contribution towards corporate sustainability and
energy efficiency.

You will present
the PowerPoint slides in?class. High quality PowerPoint slides have clear
messages, are uncluttered and contain essential information only. Here are the
main criteria:

Introduction ? purpose explained; concise and to
the point.

Explanation and illustration of major conceptual
points. Definition and explanation of relevant terminology.

Organisation and development of material ?
continuity in the flow of ideas.

Audience interest. Were the main issues explained
in an easy to understand manner. Presentation to time – too short; too long.

Concluding remarks ? effectiveness of summary
comments.

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Much of the impression you make will be when you present
the slides in?class. It is up to you how many of your group members speak
during the presentation (we suggest 1 or 2 presenters ? 5 minutes is a very
short period of time). It looks best when all group members stand up alongside
their presenter(s) during the presentation. Also, the UTS management will ask
questions about details and specifics, and so each group member should stand by
the presenter(s) in case they are best positioned to answer.

5. MAXIMUM LENGTH

The Excel and PowerPoint files have no size
restrictions.

The written report must be formatted as follows
(including insertion of Excel extract tables):

Margins of 2.5cm (all four margins)

Adequate spacing between lines and paragraphs
Font size of 11

Maximum page length = 10 page report + 1 page executive summary + Peer
Review Sheet + Cover Page1 + Reference List +
appendices

Your assignment will be primarily assessed based
on what you put in your report, with appendices providing technical
information, supporting calculations and assumptions. Pages beyond the maximum
length of 10 pages for the body of the report will NOT be read or
marked.

Remember although this is not an academic style
report (it is a business style report) referencing is important and must be
done according to university guidelines using an acceptable method (i.e. either
footnoting or Harvard method, as per the guide to writing assignments).

6. SUBMITTING YOUR FILES

Submission time and date for all formats is by 9am
Monday 19th May. The in?class presentations are during the week.

Soft copiesTurnItIn:You must submit the Word report to TurnItIn
(a system that checks forplagiarism and cheating), found on UTS
Online in the Assessments folder.

USB:You must bring your PowerPoint file and
Excel file for the in?class presentationon a USB stick.

Excel:You must email to your lecturer asingle
Excel workbook that contains all yourfinancial modelling (see
lecturer details below).

Hard copies
Hard copies must be handed?in to:

Assignment Box 10, Level 3 outside the School of Accounting.

a. Word: 1 hard
copy.

b. PowerPoint: 1 hard copy.
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1 The Cover Page should not include the
Executive Summary.

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A completed PEER REVIEW SHEET (as found at the end of the group
assignment document) MUSTbe attached to the bundle of hard copies that
you hand?in. Assignments without thiswill not be marked.

Lecturer/Class details:

Tuesday 3pm

Dr David Bedford

David.Bedford@uts.edu.au

Tuesday 6pm

Dr David Bedford

David.Bedford@uts.edu.au

Wednesday 9am

Dr Paul Brown

Paul.J.Brown@uts.edu.au

Wednesday 12noon

Dr Paul Brown

Paul.J.Brown@uts.edu.au

Wednesday 6pm

Allan North

Allan.North@uts.edu.au

Thursday 12noon

Allan North

Allan.North@uts.edu.au

7. IN?CLASS PRESENTATION

Your group’s in?class presentation time?slot will
be 5 minutes followed by 2 minutes of questions (i.e., 7 minutes in total). You
may wish to also present some of your financial model in that time. 5 minutes
is a very short amount of time; usually only enough for 1 or 2 group members to
present. All group members should stand by the presenter(s) during the
presentation, and be available to answer questions.

You must bring to class a USB stick with your
PowerPoint (and Excel file if you wish to present it too).

Your presentation should be professional, in
terms of content and delivery. We expect you to do some research to learn about
making a high quality presentation, e.g.:

See Module
6 Communication and effective presentations lecture slides and guide notes from
the Energy Efficiency 2 day course with modular seminars, available from: http://sustainability.edu.au/material/teaching?materials/energy?efficiency?2?day?course/

http://www.microsoft.com/atwork/skills/presentations.aspx

http://www.youtube.com/watch?v=HUpI6ROwRAE&feature=related
http://www.youtube.com/watch?v=RHX?xnP_G5s&feature=related

8.
GROUPS

Students must
organise themselves into groups of 3 or 4 students from the same class – no
other size is permissible. If you are unable to join such a group by
week 5 you must contact your lecturer.

Expectations are
that you will function collaboratively in each part of the assignment. This
does not mean that you break up the parts and do them individually. Each part
should be done as a group.

When you hand?in your
assignment you must include the PEER REVIEW SHEET attached to the end of this
document.

We suggest you set up a Dropbox for file sharing
with your group members (www.dropbox.com).

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9. MARKING
GUIDE

The main learning objective is for you, within a
group, to gain practice in applying costs analysis techniques and to produce
and present a business case. There are two main components:

Logical structure
and assembly of the numbers, i.e., technical correctness and estimation method rigour
(but not estimation accuracy. Because your model input information can only be
based on publicly available and limited information, much of your modelling
output cannot be judged on accuracy).

Presentation of the business case, i.e.,
communication to a senior management audience.

The business case
has a Sustainability and Energy Efficiency theme, in keeping with the UTS
commitment to equip graduates with skills to positively contribute to sustainable
development.

Your work will be assessed with the following
(unequally weighted) criteria:

Excel modelling:

1.
Identification
and operation of main cost and revenue drivers.

2.
Configured
to flexibly and reliably perform sensitivity analyses.
3.
Clarity and
organization of model structure.
4.
Reference
to appropriate publicly available information.
5.
Effective
use of fixed and variable costs framework.
6.
Effective
use of relevant and irrelevant costs framework.
7.
Clear and
appropriate breakdown of capital expenditure.
8.
Inclusion
of Sustainability and Energy Efficiency themes.
9.
Technical
correctness of discounted cash flows.

10. Appropriate summary tables provided.

Word document:

11. Executive Summary and overall ‘business style’
presentation.
12. Conciseness and readability of discussion of
financial analysis.
13. Clear explanation of the project or projects

14.
Effective
explanation of your financial analysis method (e.g., model structure, cost
driver analyses).

15. Quality of information to aid decision?making.

16. Appropriateness of Excel tables and discussion of
them.

Presentation & Powerpoint:

17. Clarity of explanation of the main issues and
main ‘numbers’.

18.
Effective
explanation of your financial analysis method (e.g., model structure, cost
driver analyses).
19. Smoothness of in?class presentation delivery.

20. Apparent level of preparation for in?class
presentation.

21. Presenters’ level of familiarity with important
details.

As a final point: high quality work contains
concise communication and professional presentation, typically requiring
numerous drafts – don’t leave your assignment to the last minute. It will be very
obvious if your work was rushed rather than carefully re?worked and
reiteratively refined!

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10.
REFERENCE DOCUMENTS

i.
General
information about UTS, including information about energy usage:

a. https://www.uts.edu.au/sites/default/files/ENERGY_GREENHOUSE_PLAN.140301.p
df

b.
http://www.uts.edu.au/partners?and?community/initiatives/uts?green/campus?
operations/special?projects

SECONDARY (includes technical guides and case studies)

Cooremans, C., 2011, Make it
Strategic! Financial investment logic is not enough. Energy Efficiency
(download as PDF from UTS Library online)

http://www.uts.edu.au/about/uts?business?school/what?we?do/sustainability/energy?
efficiency/project?material

http://www.uts.edu.au/about/uts?business?school/what?we?do/sustainability/energy?
efficiency/links

Great resource: http://eex.gov.au/industry?sectors/other?sectors/commercial?and?services/

Guidance on business case
preparation: http://eex.gov.au/energy?management/the? business?case?and?beyond/

www.cleanenergycouncil.org.au

Department of Resources, Energy and Tourism
(RET). 2010. Energy Efficiency Opportunities: Representative Assessment
Guide, URL: http://energyefficiencyopportunities.gov.au/eeo?
steps/conducting?assessments/representative?assessments/
Energy saving measurement guide: http://energyefficiencyopportunities.gov.au/guides/energy?savings?measurement/

Some case studies: http://industry.gov.au/Energy/IndustrialEnergyEfficiency/Pages/CaseStudies.aspx

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APPENDIX
ONE: The Brief

You
are professional management accountants and have been asked by UTS management
to prepare a cost benefit analysis (feasibility study) on an energy efficiency project
will help UTS achieve energy reduction objectives. Your report is to be
addressed to the client: UTS Green, as specified below. This project is based
on a real set of options being considered by UTS, and UTS may implement
recommendations suggested by your team.

The
outcome from this assignment is a cost benefit analysis, including NPV
calculations, for one project. The data you provide will need to be
sufficiently detailed and sourced so that UTS management could make a decision
to accept or reject the project. If accepted, a more detailed study would be
conducted by UTS, including the preparation of tender documents as per UTS
procurement and other policies.

Your
report must focus on one of the following projects:

a.
Project A: Identify and
compare alternative renewable energy options for Building 5, such as the
instillation of wind turbines and / or solar panels.
b.
Project B: Upgrade of
glass (exterior) for Building 10 to reduce heat gain and loss from the envelope
of the building.
c.
Project C: Evaluate
where to install flexible sub-metering and control systems (Plugwise system).

Each
off the above projects is based on ideas for projects where there is
significant information available in the form of technical guides, case
studies, and from suppliers of technology. A quick Google search will furnish
you with examples and different options. You may extrapolate from these sources
in your report, providing they are reasonable sources of data and referenced
appropriately.

We
expect you to first investigate how the project technology operates in order
for you to identify the divers and potential for cost savings. You will need to
justify and support the different sections of your report with both academic
as well as practitioner based literature references.

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The client is primarily represented Dr
Paul Brown, so students can ask questions on the discussion board to the
subject coordinator (Paul Brown) for guidance (do not send emails to him about
the assignment). If Paul is able to provide any additional data and information
through the semester which is relevant to the assignment, he will post them to
the discussion board.

Further
details and hints for projects:

a.
Project A: Identify and
compare alternative renewable energy options for Building 5, such as the
instillation of wind turbines and / or solar panels. This is probably the
easiest project to assess, so you will be marked accordingly; we will be
looking for advanced analysis. You may start by using Google maps to identify
the size and layout of the roof structure.
b.
Project B: Upgrade of
glass for Building 10 to reduce heat gain and loss from the envelope of the
building. We think that building 10 glass is only about 6mm thick, which means
that lots of heat passes through, which means in summer the building gets extra
hot, causing the air conditioning to work harder than necessary to maintain a
comfortable temperature. In winter, lots off heat is lost, causing the heating
system to work extra hard. Options under consideration are to replace all or
some of the glass; apply a film to the glass to increase the insulation and
reflection; install some type of bolt on modular blind to increase shading
during summer. One place to start is http://viridianglass.com/products/Default.aspx
(they have energy performance charts which will help with assessing how much
energy might be saved. Some data on energy consumption in building 10 will be
released once it becomes available. You will want to visit building 10 to get
an idea of the scale of the project, and to get an estimate of the amount of
glass.

c.
Project C: Evaluate
where to install flexible sub-metering and control systems (Plugwise systems: http://www.plugwise.com/smart-buildings).
Plugwise is a ‘plug-in type wireless monitor and control device’ system, and
they have been successful in making through the tendering process at UTS, and
UTS have purchased to have 10 Plugwise systems to be installed by the end of
September. There are two key ways the Plugwise systems can assist with the control
of energy. First, it measures the amount of energy used by connected devices,
which allows for high energy consuming devices to be manages or replaced.
Second, it results in direct energy savings through shutting off power so that
the device does

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not
remain in stand-by mode. A key way in which the system works is that devices
can be turned on and of remotely, so for example a staff member could log on
and turn off their lights, computers or other devices from home, or an
administrator could turn off all equipment on a floor at the end of the day. The
focus is on control of lights and power points, such as printers and
photocopiers. Computers are being controlled by Greentrack, so they are out of
scope.2.
See the Plugwise site for more details and case studies on how this hasbeen
used by other organisations to reduce energy.

See attachment two for
a trial of a small Plugwise system. UTS are not sure where best to implement
all the systems, and would like you to evaluate some alternatives. See page 17
of the following document for some additional details: https://www.uts.edu.au/sites/default/files/ENERGY_GREENHOUSE_PLAN.140
301.pdf. You may want to walk around and observe areas where the
technologymay be used, so as to get an appreciation
for the amount of savings possible. A limitation of this option is that large
parts of building 5 may possibly be renovated as we move into new building
later this year (the Business School will be moving into the new building,
which would be a major disruption). Accordingly, you may want to focus on a
different building for your analysis. We will provide some additional date on
Plugwise as a system is currently being implemented, so we will share with you
what we learn via the UTS Online.
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2 To give you an
idea off the type of savings from IT and some details about current projects
focusing on IT at UTS, see: http://www.uts.edu.au/partners?and?community/initiatives/uts?green/campus?
operations/computers?and?it. Some
equipment in lecture rooms is already controlled by cbus, so are also outof scope.

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Attachment
Two: Background to the Brief

Your
client, UTS Green, has given CMA students the opportunity to work on a real set
of projects which UTS is currently addressing.

As
this is a real project, the best assignment groups will receive recognition,
and may have their project implemented. This assignment allows for
collaboration between the operations and teaching sections of the university,
to provide students with real world experience through the opportunity to work
toward developing solutions to real problems.

UTS
is demonstrating leadership in reducing its own greenhouse gas emissions. As
part of a commitment to sustainability, all Australian Technology Universities
(ATN) universities have publicly committed to significant GHG reductions. For
UTS this equates to 11% reduction in greenhouse gas emissions by 2012-13, and
30% by 2020-21, against a 2007 baseline. In order to achieve these targets UTS
is implementing the energy saving recommendations identified in the Energy
Audit Implementation Plan. $9 million will be invested in this project over
2011-2012.

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Attachment
Three: Data from Pilot Tests of a ‘Plug-in Type Wireless Monitor and Control
Device’ (project C)

Eric
from UTS Green has conducted some pilot testing of a ‘Plug-in Type Wireless
Monitor and Control Device’ System (for details of how the system works, see: http://www.plugwise.com/smart-buildings). The
system piloted includes physical controldevices
attached to lights, computers, and other equipment; which communicates
wirelessly to a central computer. It is common for engineers to pilot test new
technology prior to wide adoption to evaluate whether the system operates in
the target environment, and to assess the potential costs and benefits.

Two
trials have been enacted. The first trial includes 3 computers and two
printers, and is detailed below in the Energy Efficiency Project Sheet. The
estimated savings from these five pieces of equipment is estimated at $112.6
per year, which is a significant reduction in running cost. The second trial is
underway, and is set up in Building 3. Figure 4.1 depicts the rooms covered
under the pilot test. Further detail on the second test may be released as data
becomes available.

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12

Figure
4.1 Rooms included in Plugwise trial two in Building 3
.jpg”>

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.gif”>Cost Management and Analysis: Assessment 2 (Group Assignment) –
PEER REVIEW SHEET

PEER REVIEW SHEET –this cover page must be attached to the front of your
assignment and signed by each group member

Lecturer’s Name: Class Day: Class Time:
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Group work is an
important part of business education. The purpose of group work goes beyond the
requirements of the group project itself. Group work is intended to develop
awareness of the dynamics of teamwork and your role in a team environment. It
is expected that each team member will communicate with other team members in a
professional and courteous manner. Resolving any conflict or difficulties that
arise is part of the group dynamics that may emerge during the project. It is
expected that each team member will take responsibility for managing and
reducing any conflict. If the team members are unable to resolve tensions or
conflicts then this MUST be discussed with the lecturer/tutor as soon as it
becomes obvious that a resolution within the team cannot be agreed. In the
learning environment of group work we are seeking to ensure you develop
academic skills and important group work skills such as:

Commitment to working with others (e.g.,
undertaking a fair share of the work, sharing ideas, doing the tasks allocated,
attending meetings)

Collaboration and inclusiveness (e.g.,
encouraging and respecting others; recognising skills and valuing the
contribution of others, helping resolve conflicts) Contribution to establishing
and working towards a common outcome (e.g., establishing and supporting team
goals, plans, rules, roles, decisions)

Student Contribution
%

First Name

Last Name

Student Number

Student #1

Student #2

Student #3

Student #4

#1

%

%

%

%

#2

%

%

%

%

#3

%

%

%

%

#4

%

%

%

%

Total = 100%

Total = 100%

Total = 100%

Total = 100%

Personal Signature:

Please note that if
you have assigned group members non?equal percentages, you must attach a
statement explaining why you believe a group member/group members have not
contributed their fair share to the project, a breakdown of tasks you and
others have completed in the project, an estimate of the time you think each of
those tasks has taken and any other positive or negative contributions made by
you and others. This information will be shown to other group members so that
they have an opportunity to respond. While each group member’s
comments will be taken into consideration, the final decision on how the marks
are awarded will remain the right of the lecturer.

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