Upload
dooymax
View
123
Download
0
Tags:
Embed Size (px)
Citation preview
PREPARED BY:
Benjamin Elisha Sawe
D61/61708/2010
Lecturer: Mr. Karanja & Mr. Gichana
Management Accounting – DAC 503
march 2011
ContentsHistorical Background.............................................................................................................................2
Strategic Partners...................................................................................................................................4
Basic Management Accounting Concepts..............................................................................................4
Planning..............................................................................................................................................4
Directing and Motivating....................................................................................................................4
Controlling..........................................................................................................................................5
What is meant by Cost?......................................................................................................................5
Cost Objects.......................................................................................................................................5
Analysis of Costs, Volume and Pricing to Increase Profitability – C.V.P..................................................5
Cost drivers and cost-behavior...........................................................................................................5
Cost Management Systems....................................................................................................................6
Types of Management Accounting Systems.......................................................................................6
Activity Based Costing........................................................................................................................6
Relevant Information for Special Decisions............................................................................................6
Special Order Decisions......................................................................................................................5
Outsourcing Decisions........................................................................................................................7
Budgets and Preparing the Master Budget............................................................................................8
The Planning Process..........................................................................................................................8
Coordination.......................................................................................................................................8
Corrective Action................................................................................................................................8
Types of Budgets................................................................................................................................8
The Master Budget.............................................................................................................................9
Functions of Budget..........................................................................................................................10
Operating Budget.............................................................................................................................14
The Role of Budgets for Cost Control and Performance Evaluation.................................................16
Management Control Systems and Responsibility Accounting............................................................16
Managerial accountants role in managerial control.........................................................................16
Controlling and measurement of financial performance..................................................................16
Performance Evaluation.......................................................................................................................17
Evaluating Investment Center..........................................................................................................17
Strategic Performance Measurement: The balance Scorecard...........................................................17
Long term strategic performance.....................................................................................................17
Balanced Scorecard..........................................................................................................................18
References........................................................................................................................................19
1
Historical Background
Managerial accounting is concerned with providing information to managers- that is, to those who are inside an organization and who direct and control its operations. Managerial accounting can be contrasted with financial accounting, which is concerned with providing information to stockholders, creditors and others who are outside an organization
Managerial accounting information includes:
A) Information on the costs of an organization’s products and services. For Example, managers can use product costs to guide the setting of selling prices. In addition, these product costs are used for inventory valuation and income determination
B) Budgets. A budget is a quantitative expression of a plan. C) Performance reports: These reports often consist of comparisons of budgets with
actual results. The deviations of actual results from budget are called variances D) Other information which assist managers in their planning and control activities.
Examples are information on revenues of an organization’s products and services, sales back logs, unit quantities and demands on capacity resource
In the present day management function, a manager should undertake several duties is an
organisation which includes: planning, controlling, decision making, communication,
coordination etc. Management accounting as a discipline should provide the manager with
tools that will facilitate their core functions.
Taylor Nelson Sofres (TNS) Ltd is the world's largest custom market research
specialist. It has offices in more than 80 countries across Africa, Americas, Asia Pacific,
Europe and the Middle East.It is also a global leader in customer stakeholder management
research and the biggest provider of online market information in the world. The firm was
acquired by WPP Group, the world's largest advertising company.
TNS boasts a powerful global network. It separates its worldwide operations into four main divisions: North America, Europe, Asia Pacific and emerging markets.
On 7 January 2011, the largest custom research agency in West and Central Africa, Research
and Marketing Services Ltd (RMS) became part of TNS after TNS acquired a majority stake
in RMS. The acquisition of a majority stake in RMS follows an affiliation agreement signed
in March 2010 with RMS and an investment by WPP in RMS in August 2010. The
acquisition of RMS added Nigeria, Senegal, Cameroon, Ivory Coast and Ghana to TNS’
existing African network covering South Africa, Kenya, Tanzania, Uganda, Egypt and
Morocco
The merge led to formation of TNS RMS Ltd
2
TNS is a world-leading market research firm that focuses and specializes in five market sectors:-
1. Automotive
TNS automotive specialist network comprises of researchers that spans over 50 countries across North America, Europe, Asia Pacific, Latin America, Middle East and Africa. It addresses the complex market research needs of clients including major global automotive and tyre manufacturers, component suppliers, oil companies, repair specialists, parts distributors, dealerships and advertising agencies.
2. Consumer (FMCG)
TNS provides consultancy, advice and research solutions on key issues such as brand equity, purchasing behaviour, growth opportunities in the emerging markets and international expansion and help its clients identify future influential consumers to drive growth. Its customised research solutions deliver added value to clients in the development of new products, optimising advertising and media expenditure, defining new market segments or consolidating their position in the marketplace. TNS global consumer research solutions cover both qualitative and quantitative market information needs, including: ad hoc research; retail and shopper insights; brand and advertising tracking; customer commitment and satisfaction studies; market segmentation and positioning; new product development solutions.
3. Finance
TNS Finance has over 40 years of solving common Finance sector marketing problems to help retail and commercial banks, investment companies, payment organisations and insurers solve their marketing problems and build their brands. It offers its clients finance research and marketing insights in areas such as product development, brand positioning, pricing, forecasting, communications, segmentation and stakeholder management. It also offers a range of syndicated services across the globe. TNS Finance offers both breadth and depth of information and market research insight services through a network of professionals dedicated to the finance sector in over 40 countries. It has designed 45 well-respected, syndicated business research programmes across 15 countries. TNS Finance is present in 90% of the global finance market research sector.
4. Political and social
TNS is a world leader in customised political and social research. It is recognised as the research partner inspiring the world’s leading policy makers by providing action-oriented analysis and recommendations based on reliable and unique data. It covers elections and delivers insight to assist decision makers in a wide range of social policy areas: education, health, social services, environment, labour market, family policy, public transport, justice, immigration, community integration - to name a few. Its clients include public sector and government bodies, political parties, the media, non-government organisations and major international and national institutions. It has specialist expertise in the following key areas: behavioral change and social marketing; political and electoral research; strategic qualitative research; programme evaluation; and international research.
3
5. Technology
In a relentlessly innovative industry, TNS Technology helps the world's leading IT, telecoms and consumer electronics companies, ISP and content providers maximise opportunities to gain a competitive advantage based on technology market research and technology industry analysis. It offers its clients a range of global market research services and market research analysis solutions.
Strategic Partners and Clients
TNS has a partnership with UNICEF, which for over 60 years has been the world’s leading children charity, working on the ground in 156 countries and territories to help children survive and thrive, from early childhood through adolescence, among other partners include:-
Procter & Gamble Co, Safaricom, Airtel, MTN, Toyota, Unilever, BAT, Barclays, Samsung,
Microsoft, PSI, Coca cola, EABL, World Bank, TI among others
Introduction
Managerial Accounting provides information to Managers at TNS RMS Ltd who direct and
control all the operations. This information is used to prepare the variety of reports which are
used to evaluate how the business has performed and also gives frequent updates on orders
received, orders backlog and status, etc.
Management Accounting therefore provides the managers with data for internal use. This data
is emphasized depending on the relevance that is intended and mainly assists in focus on what
needs to be achieved in short or long term.
Basic Management Accounting Concepts
Planning
Before taking any action Managers at TNS RMS Ltd normally evaluate the alternatives
available and finally settles on one that will enable the company to maximize profits while
minimizing costs taking into consideration the scarcity of resources.
Directing and Motivating
Managers are expected to direct and motivate people. Management Accounting provides
managers with information contained in daily reports that indicate the tasks to be done and the
best alternative available with an aim of eliminating activities that do not give any value add
to the products and services offered by TNS RMS .
4
Employees are rewarded for value-add decisions that they undertake and this has gone a long
way into motivating employees in becoming problem solvers.
Controlling
Control being the process of ensuring that the firm’s activities conform to its initial plan or
budget is very important in the overall organizational performance. This ensures that the plan
as laid down is being followed and any deviations are addressed appropriately and
Performance reports given so that corrective measures are put in place at the right time.
Without control, performance evaluation would be a major challenge.
What is meant by Cost?
At TNS RMS Ltd, cost refers to any expense incurred in operations and administrative functions.
Cost Objects
Cost Objects at TNS RMS Ltd refer to general revenue generation activities which are further classified into fixed and variable costs.
Analysis of Costs, Volume and Pricing to Increase Profitability – C.V.P
CVP helps the making tactical short-term decisions. This is the systematic method of examining the relationship between changes in volume and the respective costs associated with any decrease or increase in volume.
At TNS RMS Ltd, it’s important for managers to understand the nature of cost behavior and
how changes in volume impact profitability. They must calculate break-even points and how
to manage to achieve target income levels. They must think about business models and the
ability (or inability) to bring them to profitability via increases in scale. Managers call upon
their internal accounting staff to pull together information and make appropriate
recommendations.
Cost drivers and cost-behavior
When sales vary, the amount of corresponding change in the net income is directly influenced
by the company’s cost structure.
Cost behavior study helps managers at TNS RMS Ltd to make strategic decisions and
operating decisions based on profitability and relevance.
TNS RMS Ltd managers in their decision making when determining production costs
normally decide on what should be treated as fixed costs. What falls under such category is
5
annually reviewed to ensure that whatever variable costs or semi variable costs that may need
to be henceforth treated as fixed is properly managed.
Cost Management Systems
At TNS RMS Ltd, problems of allocating overheads over time are easily solved through cost management. The company has adopted the activity based accounting method for accuracy.
The ABC system allocates the costs in the activity cost pools to products using variety of cost drivers. Activities like sourcing; shipping and delivery of products to customers are costed accurately.
Types of Management Accounting Systems
Activity Based Costing
Activity based accounting traces costs to activities and then to products. At TNS RMS Ltd,
this is very important because in most instances, no order is a replica of another and every
activity is important part of the company’s knowledge management for future reference.
Through ABC, TNS RMS Ltd has managed to:
Improve product or service cost data.
Improved decisions about pricing, service mixes, and product strategies based on more
accurate cost information.
Cost reduction by eliminating the non-value added activities that are inefficient, wasteful thus
reducing input and improving on the cost of service delivery.
Relevant Information for Special Decisions
As TNS RMS is a research organisation its cost systems differ a lot from a manufacturing
concern and they are unique in some way, some of the characteristic features of the research
business which influence the cost structure of its costing systems. These characteristic
features can be summed up as follows
• Variable work load: the volume of operations fluctuates enormously from one moment to
the next, which obviates the problem of capacity management, given that at certain times
there are "peaks" whilst at other times there are "valleys" which means that these resources
are underused.
6
• High fixed costs: resources are usually allocated to covering "peaks" of activity. However,
the cost of these resources does not vary with the volume of transactions, because they have a
large fixed component.
• Predictability of the activity: although the demand for services tends to be highly variable, it
is relatively easy to predict, because it follows a cyclic behaviour pattern, which offers the
possibility of turning part of fixed costs into variable ones by means of outsourcing.
• Mass services production activities: a comparison can be drawn between the high volume of
repetitive operations in research institutions and traditional industrial mass commodity
manufacturing, which facilitates the use of methodologies that originated in industry and the
setting up of a standard costing system.
• Joint production and an undefined product: the research product is physically indefinable
which makes it more complex to identify.
• Low cost traceability: given that we are dealing with joint production activities with elevated
fixed and indirect costs there are many resources that are shared by activities, customers,
products and centers of responsibility.
The most significant factors that influence the applicability of different cost systems in
a Research institution are on the one hand, the significant weight of indirect costs in relation
to cost objects, which makes it difficult to trace them in relation to cost objects. Similarly,
given that a large part of the operations carried out by Research institutions are of a repetitive
nature and susceptible to standardisation, this makes it feasible to consider calculating the
costs of these operations and allocating them to cost objects, and to introduce the use of
standard costs as a planning and control instrument.
Outsourcing Decisions
TNS RMS Ltd in some instances outsource its work to other research organizations for
processing of data and research services as long as the contracted party maintains the high
quality. However, to reach such decisions, the options are critically analyzed and options
weighed on capacity and the availability of recourses.
7
Budgets and Preparing the Master Budget
At TNS RMS Ltd, budgets are used by the management for financial planning on how
finances will be raised and allocated to various functions of the organization. They provide
focus on the future, evaluating performance and control, employee motivation and also act as
a communication device from top-bottom and from supervisory level to top management.
A master budget containing several individual budgets that are linked to each other are also
sequentially prepared in line with the company’s strategic goals.
The Planning Process
The budgets serves as a communication tool and eliminates the problem of having the
planning function in the organization being taken as an informal function with no guidelines.
The budget formalizes and documents managerial plans, clearly communicating objectives to
both the management and sub ordinates.
Coordination
Budgeting process forces coordination among the departments to promote decisions in the best interest of the company.
Corrective Action
Budgeting provides advance notice of potential shortages, bottlenecks or other weaknesses in
operating plans e.g. cash budget alerts managers when the company can expect cash
shortages during the coming period.
8
Types of Budgets
The Master Budget
PREPARING MASTER BUDGET
Budgeting at TNS RMS in general is the art of quantifying objectives in financial
terms that can assists managers in decision making process.
It is the function of the management accountant to provide information needed in
budgeting process.
Budgeting performs the following functions in a company:
1. Quantification of plans
2. Help in financial planning
3. Monitoring and controlling scarce resources through performance measurement
These broad three functions of budgeting can be further subdivided into the following more
specific functions of budgeting to give a clearer understanding in a more vivid
and lucid manner.
9
FUNCTIONS OF BUDGET
FORECASTING: this entails making a calculated attempt into knowing what the
future holds. Forecasting may not be perfect as evidence has shown but it is
better to have a forecast to work with than not having any as this will help the management to
get prepared. There are many statistical tools developed over the years to help
managers and accountants make better forecast.
Forecasting is a complex exercise that requires one to consider many variables
in the light of; the action of competitors, government actions, economic
outlook, relationship between price and demands, etc.
PLANNING: generally speaking, planning depends on forecast that has been made in
the past to make decision about the future. The estimated data generated by
forecasting are used to make plans. At TNS RMS, for example the management
use forecast from estimated earnings to make plans on further reinforcement of manpower
and increasing resources
They also use forecast figure to estimate the use of materials and make
plans to ensure that they are provided as and when due.
Financial models on computers makes the mixture of variables on an ‘what if’
scenario possible so that the best possible mix of variables are achieved.
Spreadsheet is one of the most popular financial models used for planning and
Forecasting at TNS RMS
10
COMMUNICATION: budgeting at TNS RMS acts as a communication tool in the
following ways:
1. Gathering information: information about a company and the activities
of its competitors are gathered during the process of making all kinds of
budget. It is quite impossible for a single individual to gather all these
information that are needed to make a functional budget. Managers and other
non managerial staff are consulted and information obtained from
them. This information will then be analyzed, challenged and criticised in
order to come up with filtered information.
2. Disseminating information: budgets when not acted upon are useless, so, the budgetary
system has an inbuilt information dissemination ability that ensures that responsible
managers actually got the budget which they will work with. Budgeting committee
is usually formed to act as a forum where representatives from different parts
of the organisation will assemble to iron out issues that relates to resource
planning of the business.
MOTIVATION: motivation is the driving force that makes people to run towards
their goals rather than trudge towards it. Motivation is a relative and
subjective term, budgeting at TNS RMS is used as a motivation to staff.
Two factors needs to be considered here: how to make people follow a budget, and
setting the difficulty level of budgeting. There are two main approaches that
are used make the staff heed towards a budget, each having its
11
advantages and disadvantages. They are Authoritarian method and participatory method, these
two approaches represent two extremes. The ideal method that is actually used at TNS RMS
is the one that strive to achieve a balance between the two extremes.
Again, budgets can either be made so difficult or so easy. For a budget to
motivate staff, its level of difficulty must be somewhere around the middle of
difficulty and easiness.
EVALUATION: evaluation means to judge something with a sort of standard. The
budget represents that target performance which will then be compared with
actual performance. And this will then lead to corrective action being taken.
Evaluation in real life is not as easy.
If not handled with, evaluation can encourage actions that will harm the
organization in the long run. Again, there are some non quantifiable aspects of
a business that is hard to measure. Examples are; customer services, staff
morale, innovation, environmental friendliness, etc.
There are non-financial factors that have effects on investment appraisal that
must be considered before judging a manager as to whether he or she properly
managed the investment under his or jurisdiction. Other business success factors
CONTROL/ CO-ORDINATION: this function of budgeting is very important for an
organization to grow. Co-ordination simply means ensuring that different parts
of the business work in congruence. For example, it will be useless employing
sales force that can sell 2,000,000 units of an item when all that your company
12
has the capacity of producing is 1,200,000 units of that product. This is not to
say that plans cannot be made to get the remaining 800,000 units from an
alternative source, in fact, this is one of the functions of budgeting- to
expose weakness so that plans can be made to cover for it.
AUTHORIZATION: budgeting helps to minimize misappropriation and embezzlement
that would have characterize corporations if a system of authorization does not
exist. Through authorization, managers are made more accountable for their
spending. A manager that has been authorized to spend KS 155,000 in a way
will be looking for trouble if she or he spends KS 155,200 without further
authorization. In fact, budgeting helps to prevent fraud.
As a manager or an accountant responsible for preparing and ensuring that
budgets are implemented.
13
THE OPERATING BUDGET
1. SALES BUDGET
Well, sales forecasting is a marketing function. Sales estimates are frequently generated by
the company's sales representatives who discuss future needs with customers (wholesalers and
retailers). Statistical forecasting techniques can also be used to make estimates of expected
future sales, considering the company's previous sales performance and various assumptions
about the future economic climate, and the actions of competitors and consumers. Pricing is
also a marketing function, but many prices are based on costs plus a markup (the supply
function) and consideration of what consumers are willing and able to pay for the product (the
demand function). Thus, the budgeted sales price is usually determined after the budgeted unit
cost has been calculated.
The information needed to develop an equation for collections is provided by the finance
department and is normally based on past experience. These calculations are somewhat more
involved than they appear to be in the equation above because of the effects of cash discounts
and the time lags between credit sales and collections. Cash discounts are frequently used to
speed up cash inflows. This puts the funds back to work sooner and reduces the need for short
term loans. However, even with a generous cash discount for prompt payment, collections for
credit sales are typically spread out over several months. The examples illustrated below
provide some of the possibilities.
2. OVERHEAD BUDGET
The overhead budget is based on a flexible budget calculation. More specifically, the
calculation is as follows:
a. Budgeted Overhead Costs
= Budgeted Fixed Overhead
+ (Budgeted Variable Overhead Rate)(D.L. Hours needed for Production from 4a)
This is a cumulative equation that combines the equations for the company's various types of
indirect resources. The predetermined overhead rates and the budgeted overhead rates are
conceptually the same.
14
The calculation for cash payments reflects one of the differences between cash flows and
accrual accounting. Since some costs, like depreciation, do not involve cash payments in the
current period, these costs must be subtracted from the total overhead costs to determine the
appropriate amount.
b. Cash Payments for Overhead
= Budgeted Overhead Cost - Depreciation and other costs that do not require cash
payments
Financial Budgets
Assumptions and predictions underlying the master budget
Zero-base budgeting
Zero-based budgeting is a technique of planning and decision-making which reverses the
working process of traditional budgeting. In traditional incremental budgeting, departmental
managers justify only increases over the previous year budget and what has been already
spent is automatically sanctioned. No reference is made to the previous level of expenditure.
By contrast, in zero-based budgeting, every department function is reviewed comprehensively
and all expenditures must be approved, rather than only increases. Zero-based budgeting
requires the budget request be justified in complete detail by each division manager starting
from the zero-base. The zero-base is indifferent to whether the total budget is increasing or
decreasing. At TNS RMS Ltd , Zero-base budgeting has led to:
1. Efficient allocation of resources, as it is based on needs and benefits.
2. Drives managers to find cost effective ways to improve operations.
3. Detects inflated budgets.
4. Useful for service departments where the output is difficult to identify.
5. Increases staff motivation by providing greater initiative and responsibility in
decision-making.
6. Increases communication and coordination within the organization.
7. Identifies and eliminates wasteful and obsolete operations.
8. Identifies opportunities for outsourcing.
9. Forces cost centers to identify their mission and their relationship to overall
goals.
15
The Role of Budgets for Cost Control and Performance Evaluation
At TNS RMS Ltd a budget provides standard costs for cost control purposes. As management
constructs budgets, it lays out a road map to guide its efforts. It states a number of
assumptions about the relationships and interaction among the economy, market dynamics,
the abilities of its sales force, and its capacity to provide the proper quantity and quality of
products demanded. Incorporation of such assumptions in to the budget leads to more
accurate planning.
An examination of the details of the budget calculations and assumptions indicates that
management expects the sales force to spend only so much in pursuit of the sales forecast.
The details also reveal that management expects operations to produce the required amount of
units within a certain cost range. Management bases its expectations and projections on the
best historical and current information, as well as its best business judgement.
Management Control Systems and Responsibility Accounting
Managerial accountants role in managerial control
Management Accounting provides a tool that acts as a basis for directing and controlling operational activities.
Managers and employees at TNS RMS Ltd are given tasks that have been broken down to their areas of operations with the departmental procedures on how each of those tasks should be performed. Standards of operations are therefore set and line managers re given the responsibility of ensuring that those procedures and standards are followed at all times within the stipulated time limit.
Controlling and measurement of financial performance
At TNS RMS Ltd, each department has a pre-set target which is used in evaluating
performance at the end of every month and every quarter. The departmental targets are further
broken down into individual targets. Performance evaluations are carried out through gross
profit reports and these are discussed in detail with the respective departmental managers as
well as individuals.
16
The different departments in the organization are classified into cost centers, revenue centers,
profit centres and investment centers which enable the management to equally evaluate their
contribution in terms of operating income and profitability.
Performance Evaluation
This is a critical function at TNS RMS Ltd and through the aspects of decentralization and responsibility accounting, the managers are empowered to make decisions and be accountable for whatever authority they exercise in doing so. Owing to the nature of its dynamic business, the company has to continually evaluate performance to ensure that:
Managers are responsible for certain aspects of the organizational performance.
They are accountable and should provide regular performance reports relating to all matters for which they are responsible.
Managers are motivated to achieve better performance by setting targets for performance, comparing the achievements against these targets, and rewarding good performance.
Managers get control over information to enable them makes decisions that will improve their performance.
Evaluating Investment Center
TNS RMS Ltd ’s main decision center is the investment center which is headed by a manager having a direct responsibility for its performance. The manager uses ratios and absolute measures for performance measurement.
Return on Investment (ROI)
This enables the company to measure how much income each shilling of investment generates and resources or assets used to generate the income. This is used for the organizational performance as well as units and subunits. This is done by using the after tax income and the net book value of assets.
This ensures that all ingredients of profitability are blend together into a single percentage.
Also enables the company to compare its performance against those in the same industry or in different business all together.
This evaluation also assists the management in highlighting the benefits that managers can obtain by reducing invests in both current and fixed assets.
Strategic Performance Measurement: The balance Scorecard
In Kenya today, there are many players in the Research business. Among the key
competitors of TNS RMS Ltd include Synovate Ltd, Research Solutions, AC Nielsen,
Infotrack, Millward Brown and Research Path amongst other players. TNS RMS Ltd uses
17
management accounting information to assess its competitiveness at the face on competition.
Speedy solutions and delivery of goods can be used to compare TNS RMS Ltd’s performance
and also can be a key indicator of the organization’s competitive advantage. The market
share information including customer segmentation and competitor substitutes is obtained
through managerial accounting to assess the organizations competitiveness in the industry.
This has enabled TNS RMS Ltd to cut a niche in the Research market segment.
Long term strategic performance
For future opportunities and market forecasting, TNS RMS Ltd has to have a long term
strategic performance objectives that will translate into sustainable business without which the
survival of the organization is not guaranteed. TNS RMS Ltd has achieved tremendous
growth through long term strategic performance targets and consequent performance
evaluations.
Balanced Scorecard
TNS RMS Ltd managers use balanced scorecard as it consists of variety of indicators both
financial and non-financial. It provides them with a comprehensive performance tool which
reflects all the measures critical for the success of the firm’s strategy. The balanced score
card enables TNS RMS Ltd to focus on:
Customer – what the customers value from the organization like quality products
delivered in good time. This assures TNS RMS Ltd client retention and customer
satisfaction which thus translates to the market share held and its growth.
Internal processes at TNS RMS Ltd have continued to improve and this has
contributed to the efficiency observed in product manufacturing, order processing and
inventory level controls.
TNS RMS Ltd business has also continued to grow through learning and innovation
thus creating a future value. This focus considers the business capacity to maintain its
competitive position via skills and development of better products and services.
Financial perspective – this measures the profitability, shareholder value measures like
revenue growth rate, gross revenue growth, operating rations, selling expense ratios,
growth in stock prices, return on sales or investments.
TNS RMS Ltd uses the balanced scorecard as a means of implementing strategy by drawing
managers’ attention to the critical success factors and rewarding them for the achievements.
18
It is also used as a framework for achieving desired organizational change in strategy drawing
attention and rewarding achievement of factors that are part of the strategy.
The balanced scorecard has also made the direction and nature of change at TNS RMS Ltd
clear to all the stakeholders. It is also used for determining each managers compensation and
advancement as well as coordination of efforts within the firm towards achieving the critical
factors.
References
1. http://bizcovering.com/category/management captured on 23rd March 2011
2. http://wikipedia.org/budgeting captured on 16th April 2011
3. http://managerialaccounting.com captured on 10th April 2011
4. http://www.tnsglobal.com captured on 20th March 2011-04-19
5. http://www.cimaglobal.com captured on 18th March 19, 2011
6. Management Accounting for Decision Makers by Dr Peter Atrill and Eddie McLaney (1st Sep 2009)
19