27 December 2015

Value Added Statement (VAS) - Trade Statement (TS)

Picture: Value added statement, or Trade statement; traded (sold/purchased) by the trader.

The Value Added Statement (VAS) show the value added by a company in the past fiscal year as its Contribution to the GDP (Gross Domestic Product/Value) of its Home country, and how it is appropriated.  
It is regarded as a part of social responsibility accounting (link).

A Value Added Statement (or Trade statement) is like a Balance sheet for an Income statement.

Balance sheet
A Balance sheet: Assets (by mobility) - Liabilities (by owner) = 0
Is a summary of 'All Resources with Financial Attributes'.
Shows a Point in Time

Income Statement
A Value Added Statement: Trades (out) - Trades (in) = 0
Is a summary of 'All Trades with Financial Attributes'.
Shows a Change in Time

Turnover (of resources)
Old: Turnover = Sales revenue ÷ Assets
New: Turnover = Resources (@ customer/stakeholder) ÷ Resources (@ producer/supplier)
Pushing the 'resource value' back in the process is one way to eliminate waste

Trade StatementI prefer to call it Trade Statement' instead of Value Added Statement'.
Why ?
* Bend 'Trade' and it still gives the right associations; a trade, to trade, traders
    Compare with "a contribution, to contribute contributors".
* ...

Trade statement (trades, traders)
Output: Products & Service, sold (purchased by Customers)
Input: Products & Service, purchased (sold by Suppliers)
=Gross value
Process: Depreciation, adjustment
=Net value
Process: Labour (sold by employees)
Process: Interest (sold by creditors)
Process: Dividend (sold by shareholders)
Process: Taxes (sold by society)
Process: Retained earnings (sold by the organisation/company)
=0 (all trades between all traders)

Trader What                   2012
Customers Sales revenue 192 676 100%
Other Other income 24 652 13%
Suppliers Cost of materials -122 450 -64%
Other upfront expenditures -22 077 -11%          Excl. Out+In
Misc Depreciation and amortization -13 135 -7% Σ: -59 667 100%
Employees Wages, salaries, benefits -29 503 -15% -29 503 49%
Creditors Interest expense -3 957 -2% -3 957 7%
Societies Taxes, duties -4 322 -2% -4 322 7%
Shareholders Dividend (or proposal for) -1 639 -1% -1 639 3%
The company Retained earnings -20 246 -11% -20 246 34%
Table: VW Value Added Statement 2012

The categorizations are not 100% perfect, but it shows the direction - the vision. 
Justice is governed by fair/just trade. What's just is relative to most people. 
Good accounting/categorisations/labellings makes it debatable/manageable by a justice system. 
A communications framework. 

Effectiveness & Efficiency
Effectiveness can be measured from One or All Traders perspective.

Picture: Efficiency = same Output with less Resources. Effective = more correct Output

Effectiveness can be measured as
a) Internal - from our set targets, or
b) External - from the traders targets.

Picture: Analytical framework

Current state
1. Understand the Output; What=Current state,
    Understand the Input+Process; Why=Root cause (the Influencing factors)
2. Understand the Function; Output = Process({Input n}). Predict the output
Desired state
3. Understand the Output target; use the Function to get the desired Output
Note: Here Output=both the Product and the Effect (outcome)

Picture: Development of Product/Process + Fed by a) Vision, or b) Unsolved problems

Picture: SmarterDraw

Control resilience theory (link)
"Once you identify the relevant parameter that controls the system's resilience, you can begin to tackle how to manipulate that resilience--how to enhance resilience or restore resilience"

Picture: Decisions are based on Comparisions; if(comparision;if-true,if-false)

Comparators. =/,</>.
Compared to a Norm/Target/Desired state, Vision/Mission.
AND: all comparisons must be true. OR: none can be false.
Boolean: compare(sum(comparisons))
Set: can be dimensions like {true, false, other}, or measures/numbers

The process of Computation is a (one form of) transformation of measures/numbers.
A process is time based sequence, also called algorithm.
Efficient process=least resources (incl. time)

Picture: Same conclusion (different illustration)

Always happy to see when others have come to the same conclusion:

Picture: Source cbsolutions.net

Picture: source

Picture: source

Links: Google search, pdf, Mapping all Braincells

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