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Q. Show the Arguments against the controllability principle?
- Political arguments may occur over such costs which are more subjective than objective when determining controllability. It is not always black and white when determining controllability from uncontrollability.
- Just because a cost is uncontrollable does not mean a manager being assessed should ignore it altogether. As an example if managers recognise there is an interest charge by head office based upon the capital employed used within a division, then to hold them more accountable could help improve efficiency by the minimisation of capital employed. In the case of head office charges, lack of accountability could encourage over consumption of these resources provided centrally.
groups and or teams will solve all the effectiveness and efficiency challenges facing the 21st century organisations.discuss
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LD is the owner and manager of her own florist business, LD Flowers. Although starting out initially as a hobby, it has developed into a sustainable business. LD's original busines
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Merits of economic value added (EVA): - Cash not accounting based measure therefore less distorted for performance measurement. - Consistent or goal congruence with profit
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Q. Arguments for the controllability principle? - It would be considered fairer by a manager if they were not assessed on costs which are not within their own control. This is
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