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PART A: THE BUSINESS ORGANISATION, ITS STAKEHOLDERS AND THE EXTERNAL ENVIRONMENT 
 
18
 
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19 
C H A P T E R 
TOPIC LIST 
SYLLABUS 
REFERENCE 
1 Analysing the business environment 
A3 (a),(b)
2 The political and legal environment 
A3 (a),(b)
3 Employment 
protection 
A3 (c)
4 Data protection and security 
A3 (d)
5 Health and safety 
A3 (e),(f)
6 Consumer 
protection 
A3 (g)
7 Social and demographic trends 
A6 (a),(c)
8 Cultural 
trends 
A6 (b)
9 The impact of technology on organisations and accountants 
A7 (a),(b)
10 Environmental factors 
A8 (a) – (c)
11 Competitive forces 
A9 (a)
12 Converting resources: the value chain 
A9 (b), A9 (d)
13 Competitive advantage – Porter's five forces model 
A9 (c)
The business 
environment
The aim of environmental analysis (Section 1) is to review 
the environment for 
opportunities
and 
threats
, and to 
secure environmental fit. An organisation has many 
interchanges with its environment. It draws inputs from it 
and outputs goods and services to it. The environment is 
a major source of uncertainty. 
An organisation is affected by 
general environmental 
trends
, usefully summarised in the