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It sheds light on why the financial results deviated from expectations and what remedies can be included in the next strategic plan in order to ensure that the company improves performance in the next period.
There are differences among budgeting techniques in different companies and it may well be that some generalizations can be made between the budgeting techniques in different countries. In the Netherlands, for example, budgets are often a compilation of departmental budgets set by lower-level managers (De With & Dijkman, 2008). Yet within that country, there is considerable divergence among public companies. The same is true for companies in other major Western nations as well -- a wide range of techniques is used in any given sample of companies.
It should be noted that in the U.S., there is a move towards post-budgeting techniques, such as Beyond Budgeting, Activity-Based Costing or...
This finding holds true to a lesser extent in other countries, but it illustrates that not all companies conduct sophisticated budgeting exercises. Jack Welch of GE was famously anti-budgeting (De With & Dijkman, 2008). For many companies, therefore, the budgeting process is either replaced by other managerial accounting processes, or is simply ignored altogether in favor of other control mechanisms.
Works Cited:
Becker, S., Messner, M. & Schaffer, U. (2010). The evolution of a management accounting idea: The case of beyond budgeting. WHU Otto Beisheim Graduate School of Management.
De With, E. & Dijkman, A. (2008). Budgeting practices of listed companies in the Netherlands. Management Accounting Quarterly. Retrieved November 3, 2011 from http://findarticles.com/p/articles/mi_m0OOL/is_1_10/ai_n31369438/?tag=r%20bxcra.2.a.33
Works Cited:
Becker, S., Messner, M. & Schaffer, U. (2010). The evolution of a management accounting idea: The case of beyond budgeting. WHU Otto Beisheim Graduate School of Management.
De With, E. & Dijkman, A. (2008). Budgeting practices of listed companies in the Netherlands. Management Accounting Quarterly. Retrieved November 3, 2011 from http://findarticles.com/p/articles/mi_m0OOL/is_1_10/ai_n31369438/?tag=r%20bxcra.2.a.33
Managerial Term Managerial Accounting FINAL EXAMINATION Please complete the following by typing your answer letter next to "ANS" (example "ANS: c) and return to your Instructor via Blackboard by midnight, August 1, 2012: A (n) ____ is a review to determine whether the policies and procedures specified by top management have been implemented. A) management audit B) internal audit C) internal control D) internal accounting control 2) Variances A) are quantitative expressions of plans of action B) ignore areas that are
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Managerial Accounting Accounting Managerial accounting is different from financial accounting because it is used primarily by companies and organization to generate weekly, daily and monthly reports to help them forecast future financial events (Birnberg, 1992). The profession of managerial accounting looks at the many ways managers can help facilitate increased revenues over defined times, and the future in general. It is not concerned with investments as much as it is concerned with
Managerial Accounting Elkay is a manufacturer of sinks. The company has three plants, serving different markets. The Ogden plant is high-volume, low-margin production. The company has new technology that makes it an innovator in efficiency. The Lumberton plant focuses on high margin items. Broadview is for commercial, institutional and specialty products. The company's information provides feedback about profits that indicates one customer type provides all of the profits, and the other
That we do not find out about cost overruns until the project is completed creates a climate where managers are motivated to overlook past transgressions yet are powerless to address future ones. Lastly, I would tie performance-based bonuses either to non-financial measures or to ones based on financial accounting, subject to GAAP and other defined rules and procedures. In general, financial incentives are only necessary when there are competing
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