Management Accounting at Ashanti Goldfields Corporation

Mathew Tsamenyi (First Author), Patricia Akua Afful-Kwaw (Participant Author)

科研成果: 其它稿件案例


Mining was the focus of Ashanti Goldfields Corporation’s (AGC) business — until it hit a financial crisis. Falling gold prices and rising mining costs in the late 1990s pushed AGC to become more oriented toward finances. However, inter-departmental rivalries and clashes arising from the shift from production to finances expanded into the ethnic and cultural realms. The case presents a series of problems that AGC was confronted with during this transitional period, such as unrealistic budget proposals, lower level employees’ lack of budgeting knowledge, slack budget controls, delays in budget reports, frequent changes in reporting structures, and problems of co-ordination and communication. How should AGC have coped with these challenges brought by the shift from a production orientation to a financial one? What measures should AGC have taken to tackle the misalignment between the production functions and management accounting teams? Ashanti Goldfields Corporation was set up by two merchants from Cape Coast, Joseph Ellis and Joseph Biney, and their accountant, Joseph Brown. In 1895 they reached an agreement with Edwin Cade for the sale of the mine, which was then called the Ellis Mine. The company was listed on the London Stock Exchange shortly after the sale in 1897. Following years of fluctuation in the composition of shareholders of the company, Ashanti Goldfields merged with AngloGold of South Africa in 2004. The merger led the new entity to adopt the name AngloGold Ashanti. The management accounting system was initially centralized at the London HQ. Things did not improve even after the HQ was transferred to Accra, and the system broke down repeatedly in times of emergency. The listing on the stock exchanges of Ghana, London and New York in 1994 brought some changes in the MA system, such as the appointment of financial controllers at the mines who reported to the Chief Operating Officer at the HQ. Each mine was also given more autonomy: the executive board would provide output targets while the mines could determine the means of achieving those targets. Overall, however, these changes did not significantly affect the use of management accounting (MA) information in the mine. For example, MA information continued to be disregarded in day-to-day operations. The significant changes in MA that were noted in the company occurred when it experienced financial crisis in the late 1990s. Unlike the previous practice where cost accountants were disregarded by mine captains and managers, each mining section was assigned a cost accountant to assist the mine captain and managers tally up their costs and interpret budget performance reports. These measures were put in place to create an awareness of costs at AGC since initially the cost controls were relaxed. The case takes a look at the management accounting practices at AGC, such as the budgeting process and its effects on operations in the Company. The case also discusses the attitudes of employees towards the budgeting process and the problems that arose as a result of that in AGC. In addition, it brings to light the tensions that arose in AGC between the accounting team and the miners, and how these and other problems were addressed. The case can be used in MBA and EMBA programs, and can be used in executive development programs and in other postgraduate courses in management accounting.
已出版 - 1 1月 2012










China Europe International Business School


  • Africa
  • Cost Management
  • Financial Budget
  • Ghana
  • Management Accounting


  • 会计


  • 采矿、采石、石油与天然气开采


探究 'Management Accounting at Ashanti Goldfields Corporation' 的科研主题。它们共同构成独一无二的指纹。