The financial planning and control in the airline industry : a comparative study of British Airways and Egyptair

Mostafa, Mahmoud Abdelwahab Mohamed

Abstract

The examination of the financial planning and control systems in the airline industry is vitally needed. There were two important reasons for deciding to study this industry: firstly, its significant role in the development of the national economy of a country, linked with the growth of international business and trade, which gives the airlines industry great importance as a rapid means of transport. Secondly, there has so far been little study of this area.This study focused on the investigation of the financial planning and control systems currently operated by both British Airways and Egyptair. These were seen in relation to a theoretical framework which provides a methodology for such procedures, with a view to improving the quality of the performance, especially at Egyptair. The study involves also the examination of the accounting systems employed by both airlines and their relevance to the financial planning and control functions.There is a great deal of government influence and intervention in public enterprises, which are involved in a variety of activities for economic development. This intervention restricts their operations in a number of ways.The conclusions of the study revealed that there are many deficiencies in Egyptair, in the budgetary control system, the information system and the feedback process. The present Implementation of the uniform accounting system, which emphasises national planning and external control is inadequate to provide the information needed for planning and control purposes at the airline; in contrast, British Airways' system is reasonably effective.Egyptair can learn and benefit both from theory, and from the adoption of certain functions and procedures used by British Airways. Some of these are: tactical planning, where plans are formulated for two years ahead, and on a seasonal basis; the method of allocating costs to each of the operated routes and aircraft; management accounting packages for internal control purposes; and specific criteria for measuring productivity, which are relevant to the airline's operations.Finally, the research findings and recommendations pave the way towards developing the procedures concerned at Egyptair and British Airways.

Citation

Mostafa, M. A. M. The financial planning and control in the airline industry : a comparative study of British Airways and Egyptair. (Thesis). University of Hull. https://hull-repository.worktribe.com/output/4210829

• Thesis Type: Thesis
• Deposit Date: Aug 8, 2011
• Publicly Available Date: Feb 22, 2023
• Keywords: Management
• Public URL: https://hull-repository.worktribe.com/output/4210829
• Additional Information: Department of Accounting, The University of Hull
• Award Date: Sep 1, 1989