1 / 12

French Systeme Croise Accounting: Benefits and Limits

Explore the French accounting system, the rationale behind the Systeme Croise, its advantages, drawbacks, and future prospects. Learn about the fixed accountancy requirements for French companies, Revenue sheet classifications, and the evolution towards an integrated accounting approach.

esweet
Download Presentation

French Systeme Croise Accounting: Benefits and Limits

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Intergrated Accounting a la Francaise: The Perspectives of the Systeme Croise Eavan Keane Carsten Binnewies Benjamin Gaillard Amy Wheatley Jari Sairinen

  2. Summary • Description of the French accounting system • Why do French companies use a « système croisé » • Benefits of this system • Limits of this system Prof. Igor N. Baranov Management Accounting

  3. Introduction • Like many countries France has a specific accounting system • In France, there is a distinction between • financial accounting, official and mostly for tax reasons • analytical accounting, unofficial and non financial in order to study cost centres Prof. Igor N. Baranov Management Accounting

  4. Requirement in accountancy for French companies • Fixed by the “Plan de Comptabilité Générale” • Include • Balance sheet • Revenue sheet • No cash flow statement • => mostly for tax and control purpose Prof. Igor N. Baranov Management Accounting

  5. Description of the Revenue sheet • All charges and products are grouped by nature and not by function or cost centre • Thus they are only classified according to their entry • Criticism • Value added produced vs value added sold • Really hard to compare with foreign companies • No managerial view • Really useful for financial analysis Prof. Igor N. Baranov Management Accounting

  6. Prof. Igor N. Baranov Management Accounting

  7. Why French companies use a « système croisé » • Big companies began to use this system in the 1980’s • By concentrating the entries in one department • It consists of recording data in two different accounts with two separate double entry • One corresponds to the nature of the operation=> for the income statement • The other one corresponds to the cost centre for the analytical accounting Prof. Igor N. Baranov Management Accounting

  8. The next step: integrated system • A triple entry system is used, introducing an extra dimension into the recording of each transaction • As well as the application (debit) and source (credit), the nature, i.e. the purpose or « raison d’être » of the operation • Impact for the company • Reliability of the information • Improve data relevance • Clear overview of the current cash flow Prof. Igor N. Baranov Management Accounting

  9. Source: The integration of financial accounting, management accounting and Cash flow accounting, Stowoy and Touron Prof. Igor N. Baranov Management Accounting

  10. Benefits of « système croisé » • Allows precise analysis of cost center for the company • Combines both accounting systems (financial and analytical) in order to reduce disparities between the two • Moves from an accounting approach to a management approach Prof. Igor N. Baranov Management Accounting

  11. Limits of the system • Implementation can be hard and expensive • A huge upsurge in the volume of clerical work • Traditional mistrust about French accounting from a global perspective • Lack of incentive to introduce this croised system=>many SME don’t have a clear idea of the principles of management system Prof. Igor N. Baranov Management Accounting

  12. Conclusion • Given the French accounting system, the Systeme Croise is the best way to implement management accounting. Prof. Igor N. Baranov Management Accounting

More Related