Week 8 Flashcards
(45 cards)
who does management accounting provide information for
managers and internal users of information
does management accounting apply to all business structures including non for profit
yes
how frequently are management account reports prepared
as frequently as needed
are management accounting reports past or current based
current and future focused
do management accounting reports give information about subunits of business
yes they do
are management accounting reports subject to external audits
no they are not
what is management accounting at its core about
wealth creation for a business and shareholders
what is organisational performance management
developing goals to support achievements of entities mission
transforming goals into strategies and measuring performance in achieving goals
what are the financial measures of performance management
profit
return on investment
residual income
what is the balanced scorecard
financial and non financial measures of performance, short term and long term
are financial indicators lagging or leading indicators
lagging because they inform after an event has occured
are non financial measures lagging or leading indicators
leading because they give current information and give insight into likely performance of business
what are the 4 perspectives to the balanced scorecard
1: financial perspective
2: customer perspective
3: internal business process perspective
4: learning and growth perspective
is there a relationship between the 4 perspectives
yes there is financial performance is the result of performance as seen by customers and the internal processes by which customers are serviced both are improved through continuous learning and growth
what is the financial perspective
How shareholder value is created
what are measures are used in the financial perspective
profit, ROI, other ratios
what is the customer perspective
creating value from new and existing customer base
what measures are used in the customer perspective
customer retention, satisfaction
what is the internal perspective
processes that need to exist to deliver customer value and achieve financial goals
what measures are used in the internal perspective
product quality, cycle from order to delivery, labor productivity and waste
what is the learning and growth perspective
continuous improvement improving the 3 other measures
what measures are used in the learning perspective
employee retention rates, employee training
are specific measures in the balanced scorecard
no but they need to be relevant to the industry a business is in
how many measures in each of the 4 perspectives
4
