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Presentation SCBA

Apr 05, 2018



Ankit Bajpai
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  • 8/2/2019 Presentation SCBA



  • 8/2/2019 Presentation SCBA


    A business organisation is also a socialunit. It uses the societys resources andproduces goods and services for which

    the society is the ultimate consumer.Thus, a business unit owes its veryexistence to the society. It is, therefore,

    necessary that a business shouldoperate within the overall parametersdetermined by the society.

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    Similarly, the society is also to see thatsuch business activities should beundertaken which are beneficial to the

    society as a whole. Keeping thisobjective in view, the Governments, bothin free and controlled economies enactsuch appropriate legislation for

    regulating growth and development ofbusiness which they consider necessaryin the overall national interest.

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    The basic philosophy behind thisarrangement is that all sectors of theeconomy, public or private, small or big,

    should work for the overall good of thesociety.

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    The concept of social cost benefit is nowincreasingly applied to the private sectoralso. The private sector also uses the

    resources of the society and, therefore,it has moral responsibility to undertakeonly such projects which are socially


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    It should, while analysing capitalexpenditure proposals, keep in view thesocial contribution aspect. In other

    words, besides commercial viability ofthe project, it should also see theassociated cost and benefits to the


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    The concept of social cost benefit hasnow started taking practical shape. ThePlanning Commission has already

    decided that in future the feasibilitystudies for the public sector projects willinclude an analysis of the social rate of


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    Measurement of social costbenefit

    The following are some of the indicators/criteria which can be used for measuringthe social costs and benefits associated

    with the projects. Employment potential

    Capital output ratio

    Value added per unit of capital

    Savings in foreign exchange

    Cost benefit ratio

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    Social accounting

    Social accounting is concerned with themeasurement and disclosure of costsand benefits to the social as a result of

    operating activities of a businessenterprise. Thus, social accountingmeasures social costs and social

    benefits as a result of business activitiesfor communication to various groupsboth within and outside the business.

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    Objective of social accounting

    Measurement of net social contribution:social accounting aims at identifying and

    measuring the periodic net socialcontribution of a firm. This includes theaggregate of net benefits to the

    companys employees, to thecommunity and to the general people.

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    Balance between firms strategies andsocial priorities: social accounting helpsin determining whether the firms

    strategies and polices are consistentwith the legitimate individual aspirationsand also with the overall priorities of the

    community and the society.

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    Communication of information: socialaccounting aims to make availableinformation of a firms goals, policies,

    programme, contribution to social goalsetc. To all segments of the society.

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    Reporting of social cost benefitinformation

    Social statement approach: according to thisapproach, two statements are prepared (i)Social Income Statement and (ii) SocialBalance Sheet. The social income statementprovides information according to socialbenefits and costs to employees, localcommunity and the general public. Socialbalance sheet portrays social investment ofcapital nature (i.e., social assets) viz.Township, roads, buildings, hospitals, schools,clubs, etc. On the assets side and theorganisations equity and social equity on theliabilities side.

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    Operating statement approach:according to this approach, a firmpresents only the positive and negative

    aspects of social activities as a result ofbusiness operations. The positiveaspects are broadly termed as socialbenefits

    while negative aspects aretermed as socialcosts.

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    Narrative approach: in case of thisapproach, disclosure regarding socialcost and social benefits is made in a

    narrative and not in a quantitative form.The firm generally highlights the positiveaspects of its social activities.

    Goal oriented approach: according tothis approach, the firm prepares of itssocial and economic goals or objectives.

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    Pictorial approach: social activitiesundertaken by an enterprise arepresented in the form of pictures. The

    annual reports contain photographs ofschool, hospital, club, Public Parkestablished and/or maintained by thefirm.

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    Social benefits to staff:

    Medical facility

    Training programme

    Concessional transport, water supply Educational facilities for children of staff


    Social costs to staff: Extra work put in by staff and officers for

    drought relief

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    Social benefits to community:

    Environmental improvements

    Generation of job opportunities

    Municipal taxes

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