Question

Al Shams tiles manufactures marbles, tiles and sanitary appliances. They manufacture the goods
on a large scale and supply it to different cities of the country. The industry is located close to a
residential area. People living close to the area had a complaint with higher authorities to shift the
industry to other suitable area. They had a complaint because industry makes a lot of noise during
the production process, makes dust and creates mobility issues for the people. The higher
authorities after enquiry, ordered for an immediate shutdown of industry.
Al Shams tiles management have already filed an appeal in a court to give enough time so they
can move the industry elsewhere. The decision of the court may take few weeks. Due to the
expected shut down, Al Shams management is worried about their production and future demand.
Meanwhile, Al Shams have to meet their day to day expenses.
They have less resources available to pay its liabilities and wages to their employees for the coming
months. If they have to change the location of their industry to another place, they have to bear a
lot of cost for shifting. All the machines and equipment’s will be relocated and fixed again. Before
shifting to another location, the management has to consider many factors.
a. In your opinion, how will Al Shams tiles make a research and a survey for the selection of best
possible location and resources for their business? What advice would you like to give to the
management of Al Shams tiles, to consider CSR?
b. If you are the accountant of Al Shams tiles, how would you analyze the financial cost of shifting
the business. What changes will you expect in your annual returns?