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BURGESS BOOKS
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Multi-Dimension Impact Accounting
Accounting for ALL the Capitals ... for Society, Nature and the Economy
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Section I
ACTION INFORMATION FOR ALL OF SOCIETY
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1-1 WHY THIS BOOK?
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Why is this book being written? What does the writer hope to achieve? What sort of impact will a changed paradigm for development produce?
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CHAPTER 11 - ANALYSIS AND REPORTING
FOR VERY BIG CORPORATE ENTITIES
10-1 THE PURPOSE OF ANALYSIS
ANALYSIS ... UNDERSTANDING
Analysis ... a step to creating value from data
Data are nothing without analysis, and TVM Value Accountancy is the same. The effective use of
analysis makes improves decision making and enables people and organizations to be more
accountable. This is what makes TVM Value Accountancy valuable. Experience has shown that
performance improves when there is active feedback and there are the data that enables people
and organizations to be held to account. People may not like it ... but their performance
improves.
The purpose of analysis is to get a better understanding. The data are neutral ... the analysis then
produces results that might suggest some conclusions. It really does not matter what analysis is
done as long as the result is better understanding and improved decision making.
One value step is moving from data through analysis to understanding ... another is to move from
understanding to effective action. In some situations this has been done with wonderful results,
but mostly there have been interventions that were more expensive than effective.
Comparative analysis
Comparative analysis has many forms ... including
- the comparison of data from one locations with another location;
- the comparison from one time to another time;
- the comparison from one organization to another
- the comparison of what should be to what actually is;
- the comparison of one approach to another approach; etc.
Analysis releases the power of data
Data without analysis is a waste.
There are data … and then there is information, then knowledge and then wisdom.
It takes analysis to move from having data to having information. Knowledge is getting
information into the human brain … and then wisdom is sorting this knowledge so that it gets
used in a useful way.
The world has a whole lot of data … most gets used for just a very little bit of analysis … a
terrible waste!
An issue ... studies
Almost every study needs some data to be the foundation for the analysis and conclusions.
Enough data are collected to satisfy the methodology of the study … and analysis is done …
conclusions drawn … and report submitted. Some time later another study in a similar area of
interest … but usually little or no reference to the prior data. Easier analysis … easier
conclusions … easier report without the problem of more data that may or may not fit exactly the
new study format, analysis and conclusions. What might be the problem and what might be the
solution.
The problem might be that many studies are part of an education process that requires original
study, analysis and reporting. In this, the primary objective is passing educational requirements
… not helping directly with the progress of society and analysis to make this better.
Merely recognizing this reality and getting the data more completely into the public space could
help significantly.
Management of data ... making metrics useful
TVM is about making metrics useful. In order to be useful the analysis has to be fast, based on
reliable data and the conclusions clear. The whole process has also got to be affordable … in
other words, low cost even if the eventual value of the process has a huge potential to be
substantial. Any process of metrics and analysis is part of the “overhead” of society, not directly
productive and its cost reduces the resources available for the valuable work!
Adding the value dimension to accounting sounds like it is adding a lot more work … but it may
simplify accounting and by adding a dimension to accounting that facilitates answering
important questions way better than a money accounting system can do on its own. Part of the
essence of good analysis is to focus on matters that are material … that are important.
Don't sweat the small stuff
The big questions about social impact cannot be answered reliably unless there is a value
component in the accounting system.
Making analysis fast and useful
Decision making needs to be timely … is best when the relevant data is available and presented
in a clear useful manner.
Management information is the least amount of information that enables a good
decision to be made in a timely way!
What this means in practice is that available data are used … and the analysis is as good as
possible relative to the available data. Rigorous academic analysis takes time … and by the time
the analysis is complete, the situation has changed … or should have changed!
TVM recognizes that the academic community and many experts in the international relief and
development industry, and in institutions like “think tanks” favor rigorous academic study of
complex economic development issues … but this approach is expensive and of rather little
practical decision making value. It is too expensive, too little and too late.
Some successful organizations have used simple rapid planning processes for years with good
outcomes … for example the UN High Commission for Refugees (UNHCR).
UNHCR Used Really Rapid Planning
For many years, the management approach of the UN High Commission for
Refugees (UNHCR) was unusual in the UN system, and very effective. They
estimated the number of refugees as quickly as possible and as accurately as
possible, and this number established a default budget framework for their
immediate operational activity. The UNHCR method made it possible for UNHCR
to do in hours what other units of the UN system would take weeks or months to
do. This approach saved lives … not to mention saving money!
In much of the business world a rapid planning process is used to take advantage of opportunities
and to avert crisis.
Fast Planning in a Business Setting
In the 1980s I was a consultant working with an international fishing company. After long and hard negotiations fishing licenses were issued to operate in the country's Exclusive Economic Zone (EEZ) … but with the provision that a fleet of fishing vessels must be deployed and operating within a very short period of time …three months, I believe. The expectation was that this was impossible and the agreement would lapse. The international fishing company came up with an urgent plan that involved very unconventional solutions and was able to deploy suitable vessels within the time limit imposed … much to the annoyance of the government officials who had designed the “trick”! Fast planning, and even faster implementation, made it possible to take advantage of a desirable opportunity!
Analysis should be done with an open mind about what the results will be. This is rare, because much analysis is done with a clear idea of what the outcome should be, and this has a terrible impact on the objectivity of the analysis.
When I was a student, my tutor, Andy Roy, was very clear about the idea that there were data, there was analysis and there were conclusions. I got high marks for my willingness to do analysis that resulted in conclusions different than the conventional wisdom. We talked a lot about the problem of data and analysis that was used merely to attempt to support conclusions already made. He anticipated the situation in recent years of conclusions in search of the data to support them.
Analysis should not be gamed to get the results that are the most desirable. Analysis should be designed to get the best possible representation of the reality. This shold be the norm, but frequently is not.
In my career I have seen this over and over again ... data and analysis used to get the results that those with control of the purse wanted. This is common in international development where recipients of funds always wanted the analysis to show what their funders expected. I believe that this has been one of the big failures of development, because it has obscured the very limited impact that most development projects have had.
Education is an important sector. Much of the value of society is derived from education and the
ability to process knowledge … but the value behavior is complex. It costs money funds to
educate a child … and many years. An educated person has better career prospects than someone
without education and this is of great value to the individual if the individual is able to locate a
job and gets the remuneration. In the case where there are little or no opportunities to use
education, the value of the education is very much reduced relative to the situation where a job is
available.
Education example
With no education or skills a person cannot do a well paid job. Without a job
opportunity an educated person cannot do a well paid job. To get value for the
individual there has to be the education and skill development and there has to be
job opportunities … both!
Value chain behavior also complex
The value chain behavior may be considered to be a derivative of cost and value behaviors. The
factors that go into value chain decisions are related to costs and profit potential. With the
application of TVM the value dimension should also get taken into consideration.
Outsourcing
Lower costs … a nearly same product or service … going into the same market … and the
outcome is likely to be higher profits. This business model has been popular in the United States
and other high wage countries for many years and is now the norm for multinational business.
The value chain for this business model has a good profit profile … but the TVM value profile is
poor because of worker impact and value destruction associated with losing jobs. There is value
adding associated with the outsourcing enterprises … but the impacts associated with gaining
jobs and losing jobs is part of the analysis.
11-1 THE REPORTING ENTITY … REPORTING BOUNDARY
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
Many years ago I was the CFO of a modestly sized US based international
company. Though we appreared to be a single company to our customers,
suppliers and so forth, we were in fact the consolidation of more than thirty
separate legal entities ... and from an operating standpoint we had performance
accounting about some 26 different operating units. We reported as a single unit,
but we made decisions based on the data from 30 or 26 different subsidiary units.
For this company, everything associated with these subsidiary units was internal
to our performance.
For all of my career ... about 50 years ... the reporting boundary that is used almost exclusively
for financial reporting is the legal entity that is at the 'top' of a group of companies and 'quoted'
on a stock exchange or used otherwise as a financing vehicle.
It is, for example, Exxon Mobil, the company, that is the entity around which a financial
reporting boundary is drawn. In this situation it is only the money costs that are included in the
accounting for the performance of the company, and in this reporting, there are substantial profits
that are reporting.
Let us take a different boundary for reporting. Let us include not only the Exxon Mobil corporate
entity, but also the various places where Exxon Mobile extracts petroleum from the ground or
under the sea. When the boundary includes these places, there has to be an accounting for the
fact that the places have depleted resources at the same time that Exxon Mobile is reporting huge
profits for its investors.
Sometimes people argue that we keep discovering more and more oil, and therefore there is
nothing to get concerned about. This may be true in terms of the next year or two or ten, but it
begs the question. The fossil fuel resources are a finite resource that took multi-million years to
create, and we have consumed a big proportion of the known fossil fuels in the past 200 years,
and in the next 100 years we might easily consume the rest. What happens then? In geological
terms, the consumption has been instantaneous relative to the creation of these resources.
One way to set the reporting on a better path would be to have all entities that use natural
resources to incluce within their reporting boundary the consumption of the resource. Using the
idea of 'replacement cost', then the costs of fossil fuels then has to include the cost of
replacement using the best available renewable ... and, of course, this changes everything.
Place ... Community
If the reporting boundary is applied to a place, or a community, then all the economic activities
in the community should be included.
The place is something that does not change over time.
I grew up in Okehampton, a small town in Devnshire in England. It is an old town
already settled in 1066 and details of the town are recorded in the Domesday
Book commissioned by William the Conqueror to inventory the country he had
conquered. The modern census data may be compared to the old Domesday Book
data to get some idea of changes over time
In the context of modern socio-economic performance metrics the State of the place at a point in
time may be compared to the State of the place at another point in time to determine the Progress
of the place.
It is to be expected that some thing will improve, and some thing will not. State is something that
includes everything that has impact on the socio-economic situation for people, place and planet.
Economic activities that are implemented by an organization may be associated with the
organization for its own consolidation. The same data are used for the consolidation or roll-up
into the organization that are used for the consolidation or roll-up into the place / community.
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
ANALYSIS OF AN ECONOMIC ACTIVITY
What is the purpose of the activity?
What are the products of the activity?
What is the structure of the activity?
Money Profit Performance?
What are the annual revenues?
What are the annual profits after tax?
What are the taxes on profits?
What is the book value of the assets deployed at period end?
What is the amount of cash, bank and short term paper at period end?
People Performance - Direct
The money metrics used in this section are the money profit accounting numbers
that are commonly used in an organization. Later we shall see that the truvalue of
the earnings, salaries, wages, bonuses, benefits, etc does not have a constant
relationship with the money number.
Based on the answers to these questions calculate the impact of the organization
on people as a direct result of the economic activities of the organization.
There are three levels:
1. Direct impact on the individual
2. An impact on the family
3. A multiplier effect in the community
The truvalue of money is not constant. When money is scarce it has a higher
truvalue than when it is abundant. [See TV standards]
What are earnings attributable to investors (same as annual profits after tax, above)?
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MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
What are salaries, bonuses and other benefits paid or payable to senior staff?
What are wages and other benefits paid or payable to other staff?
How are these expenses allocated by place (that is where the various people live)?
People Performance – impact during product use
Every product shipped has impacts during use. There is a truvalue component
that is related to the benefit the user gets from using the product.
There are also trucost components that are related to issues relating to the use of
the product, such as, for example, the consumption of fuel to operate the product.
Planet Impact – resource depletion (minerals)
How much virgin raw material goes into the production?
What is the supply chain for each of the raw materials?
Planet Impact – resource depletion (fossil energy)
How much energy is used in the production?
What sort of energy?
What is the supply chain for each sort of energy?
Planet Impact – resource depletion (old growth timber)
How much old growth timber used in the production?
What is the supply chain for this timber
Planet Impact – resource depletion (bio-diversity)
This is usually a result of the supply chain
Planet Impact – resource depletion (land degradation)
What is the use of land associated with the production?
What are the use of land issues in the supply chain?.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Planet Impact – resource depletion (water)
What clean water is required for the production?
What clean water is returned to the environment?
What is the net consumption of clean water?
What toxic water exits production and where does it go?
Planet Impact – air pollution (particulates)
What quantity of particulates emitted?
Planet Impact – air pollution (acid rain)
What quantity of acid rain pollutants emitted?
Planet Impact – air pollution (nitrous oxides)
What quantity of nitrous oxide pollutants emitted?
Planet Impact – air pollution (greenhouse gases - carbon)
What quantity of carbon dioxide (CO2) emitted?
What quantity of methane (CH4) emitted?
People Performance - impact in product supply chains
Every product consumed has a trucost profile. The trucost reflects the full trucost
of the product including all elements that affect profit, people and planet. These
elements are 'exploded' into the consumption accounting for the organization.
Planet Impact – products' post use waste chain impact
Every product also has a set of impacts that arise in the post use waste chain.
Some products are designed for post use waste chain efficiency, others are not.
There is an element of trucost that arises in the post use waste chain that is a
result of user behavior rather than being associated with the production phase.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-4 ANALYSIS OF A NOT-FOR-PROFIT ORGANIZATION
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-5 ANALYSIS OF CAPITAL MARKETS
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-6 ANALYSIS OF A NATIONAL ECONOMY
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-7 ANALYSIS OF A NATIONAL GOVERNMENT
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-8 ANALYSIS OF PEOPLE
Human resources is central to everything
Profile of the population
The profile of the population tells a whole lot about the community ...
• There are the questions of how many:
• There are questions of health:
• There are questions of education
• There are questions of jobs, work
• There are questions of wealth
• There are questions of housing
How to present this so that it is clear, simple but nor simplistic.
The value of a human being
This is a stylized graphic that shows value from a developing country perspective. Young
children represent an immediate liability as they must be fed ... as they get a bit older they have a
net value positive because they can do essential chores like carrying water. The working adult
has the most value, but offset when a women is pregnant and cannot work. Old people unable to
work are again an economic liability.
It is helpful to understand the costs or investment associated with growing up, and the earning
power and value of a working adult, and the increasing cost and liability associated with old age
and sickness.
There are two graphics below which depict this ... the first shows lifetime value, and is nothing
more than the cumulative cost of raising a child, and subsequently offset by cumulative earnings
less annual lifestyle costs ... and then impacted by the accumulating costs of old age.
Don't underestimate the potential of people
Untapped capacity
I have been in many hospitals around the world. Some amazing people doing
incredible work with tiny resources.I have only seen one surgery ... it was
successful, with a minimum of equipment ... and performed by a nurse. This is not
a recommendation for universal surgery by nurses ... but more a reminder that
much more can be done by people who do not have the top qualifications.
- See more at:
http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?
vv1=txt2009110700#sthash.Tlu7E0aM.dpuf
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MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-9 ANALYSIS FOR A PLACE
Community is central
It has been said that all politics is local ... but even more so, all life is local. More
than anything else, this is the central concept of TVM Value Accountancy.
The community is complex.
People in their own community know what is going on ... and
have an ability to hold people accountable most of the time.
People in a community often know about things ... even if they
cannot do anything about them.
People need a structure that will make it possible for what they
know to be used for the good of society ... to make their
knowledge valuable ... and people need to be able to see metrics
about society that have local meaning.
The challenge is to build a structure that does the job of
facilitating the collection, transmission and storage of data
without the structure becoming the dominant piece of the
system. The data are at the center of everything ... with the
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
structure being merely something to facilitate the data related
activities.
Reality ... data ... analysis ... activity ... impact
TVM Value Accountancy is a datacentric management process.
The process goes from reality to data, to analysis, to activity, to
impact. Data are critical to decision making ... and the
management process. This graphic presentation is not 'circular' as
such ideas are often presented, but one where things flow from
left to right. This makes for easier understanding of the state,
progress and performance of everything, especially the
performance of society.
Implementation is at the center of making progress ... but before
successful implementation there is planning and organizing ...
and everywhere there is data collection and the use of data to
improve everything so that results and impact are optimized.
Note the change in status or state from the beginning of the
period to the end of the period.
Progress is the situation getting better. Progress is the
relationship between the cost of the activities that changed the
situation and the valuadd that resulted.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
The following graphic shows how pervasive data need to be in the
management process. In every aspect of the economy there has
to be collection of data, analysis of the data and planning for
action. Without data, decision making is nothing more than
guesswork, and the results are unlikely to be very good. Without
data it is difficult to have accountability.
The following graphic shows the connection between
implementation interventions and results. An initial development
intervention may need to be quite substantial because there are
many big things to fix. As time goes on things needing fixing get
smaller and things fixed have continuing value. When done well,
a much smaller intervention will sustain progress into the
future ... sustainable development.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Congestion Costing
Many cities have a problem with street congestion ...
and several cities around the world have tried to
address the problem with some form of “pricing” that
charges users for road use. But before the discussion of
congestion pricing, it would be useful to have a
discussion of congestion costing. How much does it
cost society to have such a dysfunctional system of city
transport so that productivity is far below what is
should be. This is where data about behavior of cost is
useful. Operating a truck has three major cost
elements, the labor cost, the cost of fuel and the cost
of the equipment (truck). These costs vary based on
time (labor), the power being used (fuel) and mainly
time (for the truck). A truck stuck in traffic has high
costs ... and is doing nothing useful ... just waiting to
get moving and go somewhere.
There might be another big cost ... the cost of not
delivering on time.
Buses carrying passengers have another cost to society
which is the opportunity cost of the time being wasted
by all the passengers on board. If 30 people on a bus
are delayed one hour by congestion ... what cost does
this have. If the costing is done at $50 an hour, the
hourly cost is $1,500 ... and at a low wage rate of $10
an hour it is still $300 an hour.
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MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
How many people in a city like New York lose an hour a day
because of getting stuck in traffic. Maybe its 500,000 people ...
maybe a lot more. At a wage rate of $10 an hour, not that much
above minimum wage, the daily cost is $5 million. For a year
this amounts to $1.25 billion.
There needs to be dialog about congestion costs ... when society
knows what congestion is costing ... then perhaps leadership will
give this an appropriate priority.
- See more at:
http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?
vv1=txt2009110800#sthash.0zS2tZ09.dpuf
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-10 ANALYSIS OF THE PLANET
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF A PRODUCT
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-12 ANALYSIS OF A GOVERNMENT ENTITY
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-13 ANALYSIS OF A CONSTRUCTION PROJECT
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-14 ANALYSIS OF AN INTERNATIONAL DEVELOPMENT PROJECT
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-15 ANALYSIS OF A COMMERCIAL BANK
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-16 ANALYSIS OF A COMMUNICT BANK
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF A MICROFINANCE ORGANIZATION
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF AN INSURANCE COMPANY
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF AN INVESTMENT BANK
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF A HEDGE FUND
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF AN INTERNATIONAL DEVELOPMENT BANK
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
TVM-Book-Section-7-131025a.odt Page 40
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF A HEDGE FUND
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
TVM-Book-Section-7-131025a.odt Page 41
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF A CONSULTING FIRM
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
TVM-Book-Section-7-131025a.odt Page 42
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF A SMALL BUSINESS
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
TVM-Book-Section-7-131025a.odt Page 43
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
11-11 ANALYSIS OF A MULTINATIONAL CORPORATION
Economic activity
The 'Reporting Boundary' may be the single most important key to enabling a system of
reporting that includes the 'externalities' that are presently ignored by the prevaling GAAP
financial accounting metrics.
.
TVM-Book-Section-7-131025a.odt Page 44
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
CORPORATE ORGANIZATION
4
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Chapter 11
ANALYSIS AND REPORTING
The Various Elements
TVM-Book-Section-7-131025a.odt Page 47
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Chapter 12
ANALYSIS AND REPORTING
The Various Elements
TVM-Book-Section-7-131025a.odt Page 48
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Chapter 10
ANALYSIS AND REPORTING
The Various Elements
TVM-Book-Section-7-131025a.odt Page 49
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Chapter 13
ANALYSIS AND REPORTING
The Various Elements
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
CONTACT
Founder / CEO … TrueValueMetrics
Peter Burgess
Mailing Address:
204 Seaham Court
Bushkill PA 18324 USA
Internet/communications footprint
Telephone: mobile: 212 744 6469 landline 570 431 4385
Twitter: @truevaluemetric @peterbnyc
Blogs: http://truevaluemetrics.blogspot.com http://communityanalyticsca.blogspot.com
Email: peterbnyc@gmail.com
Skype: peterburgessnyc
LinkedIn for Peter Burgess: www.linkedin.com/in/peterburgess1/
Print on Demand Books:
Search Peter Burgess at www.lulu.com
TVM-Book-Section-7-131025a.odt Page 51
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
MULTI DIMENSION
IMPACT ACCOUNTING
(MDIA)
The TrueValueMetrics Book
Section VII
Analysis of Different Entities
TVM-Book-Section-7-131025a.odt Page 1
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Table of Contents
Background.................................................................................................................................5
TO DO … Complete this paper...................................................................................................5
CHAPTER 11 - ANALYSIS AND REPORTING...............................................................................6
FOR VERY BIG CORPORATE ENTITIES......................................................................................6
10-1 THE PURPOSE OF ANALYSIS.........................................................................................7
ANALYSIS ... UNDERSTANDING.........................................................................................7
Analysis ... a step to creating value from data.......................................................................7
Comparative analysis.............................................................................................................7
Analysis releases the power of data.......................................................................................7
An issue ... studies..................................................................................................................7
Management of data ... making metrics useful......................................................................8
Don't sweat the small stuff.....................................................................................................8
Making analysis fast and useful.............................................................................................8
UNHCR Used Really Rapid Planning..................................................8
Fast Planning in a Business Setting......................................................9
Education example..............................................................................10
Value chain behavior also complex......................................................................................10
Outsourcing..........................................................................................................................10
CHAPTER 11 - ANALYSIS AND REPORTING.............................................................................11
VARIOUS REPORTING PERSPECTIVES....................................................................................11
11-1 THE REPORTING ENTITY … REPORTING BOUNDARY.............................................12
Place ... Community.............................................................................................................12
11-2 ANALYSIS OF AN ECONOMIC ACTIVITY.....................................................................14
Economic activity.................................................................................................................14
11-3 ANALYSIS OF A CORPORATE ORGANIZATION...........................................................15
Economic activity.................................................................................................................15
11-4 ANALYSIS OF A NOT-FOR-PROFIT ORGANIZATION..................................................16
Economic activity.................................................................................................................16
11-5 ANALYSIS OF CAPITAL MARKETS................................................................................17
Economic activity.................................................................................................................17
11-6 ANALYSIS OF A NATIONAL ECONOMY........................................................................18
Economic activity.................................................................................................................18
11-7 ANALYSIS OF A NATIONAL GOVERNMENT................................................................19
Economic activity.................................................................................................................19
11-8 ANALYSIS OF PEOPLE...................................................................................................20
Human resources is central to everything............................................................................20
Profile of the population......................................................................................................20
The value of a human being.................................................................................................20
Don't underestimate the potential of people........................................................................20
Untapped capacity..............................................................................20
11-9 ANALYSIS FOR A PLACE................................................................................................22
Community is central ..........................................................................................................22
11-10 ANALYSIS OF THE PLANET.........................................................................................27
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
Economic activity.................................................................................................................27
11-11 ANALYSIS OF A PRODUCT..........................................................................................28
Economic activity.................................................................................................................28
11-12 ANALYSIS OF A GOVERNMENT ENTITY....................................................................29
Economic activity.................................................................................................................29
11-13 ANALYSIS OF A CONSTRUCTION PROJECT.............................................................30
Economic activity.................................................................................................................30
11-14 ANALYSIS OF AN INTERNATIONAL DEVELOPMENT PROJECT.............................31
Economic activity.................................................................................................................31
11-15 ANALYSIS OF A COMMERCIAL BANK........................................................................32
Economic activity.................................................................................................................32
11-16 ANALYSIS OF A COMMUNICT BANK.........................................................................33
Economic activity.................................................................................................................33
11-11 ANALYSIS OF A MICROFINANCE ORGANIZATION..................................................34
Economic activity.................................................................................................................34
11-11 ANALYSIS OF AN INSURANCE COMPANY ................................................................35
Economic activity.................................................................................................................35
11-11 ANALYSIS OF AN INVESTMENT BANK.......................................................................36
Economic activity.................................................................................................................36
11-11 ANALYSIS OF A HEDGE FUND...................................................................................37
Economic activity.................................................................................................................37
11-11 ANALYSIS OF AN INTERNATIONAL DEVELOPMENT BANK....................................38
Economic activity.................................................................................................................38
11-11 ANALYSIS OF A HEDGE FUND...................................................................................39
Economic activity.................................................................................................................39
11-11 ANALYSIS OF A CONSULTING FIRM .........................................................................40
Economic activity.................................................................................................................40
11-11 ANALYSIS OF A SMALL BUSINESS..............................................................................41
Economic activity.................................................................................................................41
11-11 ANALYSIS OF A MULTINATIONAL CORPORATION..................................................42
Economic activity.................................................................................................................42
CORPORATE ORGANIZATION..............................................................................................43
ANALYSIS AND REPORTING......................................................................................................45
The Various Elements....................................................................................................................45
ANALYSIS AND REPORTING......................................................................................................46
The Various Elements....................................................................................................................46
ANALYSIS AND REPORTING......................................................................................................47
The Various Elements....................................................................................................................47
ANALYSIS AND REPORTING......................................................................................................48
The Various Elements....................................................................................................................48
CONTACT.................................................................................................................................49
Founder / CEO … TrueValueMetrics..............................................................................49
Mailing Address: ............................................................................................................49
Internet/communications footprint..................................................................................49
Print on Demand Books: ................................................................................................49
TVM-Book-Section-7-131025a.odt Page 3
Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
TrueValueMetrics
ACTION INFORMATION FOR ALL OF SOCIETY
Meaningful Metrics about everything that Matters - Multi Dimension Impact Accounting
Metrics about the State, Progress and Performance of the Economy and Society
Metrics about Impact on People, Place, Planet and Profit
Accountability for People, Organizations and Products
Background
The reason for … the purpose of … analysis and reporting is to improve the state, progress and
performance of society.
The biggest purpose for any economic activity is to produce the goods and services needed by
people to support their standard of living and quality of life. In order to produce goods and
services and economic activity consumes resources.
One formula for reporting on the performance of an economic activity is the money profit
calculation:
Revenues less Costs equals Profit
Another formula for reporting on the performance of an economic activity is the truvaluadd
calculation:
Value Created less Value Consumed equals TruValuadd
The money profit calculation is based only on money flows, and money associated stocks and
ignores all externalities.
The truvaluadd calculation is based on a complete accounting for the change in state of
everything that is in any way associated with the economic activity.
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Copyright (c) 2013 Peter Burgess
MULTI DIMENSION IMPACT ACCOUNTING (MDIA)
The TrueValueMetrics Book – Section VII
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