Grouping of expenses is an important management practice that has promoted financial accountability among many profit-making institutions. It is through this practice, for instance, that an organization can develop and generate financial reports that are not only accurate in detail but also comprehensive in the analysis (Osadchy & Akhmetshin, 2015). This discussion elaborates on the strategy used to group expenses within the 1199 SEIU BENEFIT & PENSION FUND organization. From a personal point of view, the approach adopted for grouping expenses in this organization has proven effective concerning its long-term strategic objectives.
This organization has capitalized on its strategy describing an implementation that is similar to the traditional cost centers. My organization – 1199 SEIU BENEFIT & PENSION FUND – ensures that all production activities within the organization are analogous towards profit making and high revenue generation. From a management point of view, the traditional cost center describes the main grouping practices implemented by this organization (Osadchy & Akhmetshin, 2015). For instance, it capitalizes on HR practices such as health insurance covers and appropriate compensation packages. This boosts production initiatives that have a direct net impact on the contribution of the pension funds.
From a personal perspective, a procedural process – which defines grouping of expenses -is an alternative strategy of implementing management practices that capitalize on the legislation available. Procedural processes are better than traditional cost centers as the former introduced civilization in management practices which enhances accountability and transparency in leadership positions. In most economies, it is common to find organizations integrating the rule of law in their production processes as a means of ensuring that the operations comply with the regulations provided by the involved government agency (Anantharaman & Chuk, 2017). For instance, the Labor Laws stipulate that all employers should remit a certain percentage of wages to a pension scheme and this should not be directly linked with wages specified by the Employment Law. However, the 1199 SEIU BENEFIT & PENSION FUND does not implement this practice due to the lengthy procedures associated with the processes.
Anantharaman, D., & Chuk, E. C. (2017). The economic consequences of accounting standards: Evidence from risk-taking in pension plans. The Accounting Review, 93(4), 23-51.
Osadchy, E. A., & Akhmetshin, E. M. (2015). Accounting and control of indirect costs of organization as a condition of optimizing its financial and economic activities. International Business Management, 9(7), 1705-1709.