Chapter 3

Question 1

What is Strategic Planning? Give me 4 examples?

Answer 1

Defined as a proposal for the longer-term deployment of resources to meet objectives against competition from rival organisations

	○ Setting objectives
	○ Most appropriate organisational structure
	○ Management duties and restorability's to senior mangers 
	○ Agreeing and setting budgets

Question 2

What is management accounting?

Answer 2

○ Managers use analysis of the performance of factors such as sales levels, expenses ratios, staff costs, raw material costs, property management costs and other operational costs
- Reasonability for the regulatory reporting

Question 3

What are Critical Success Factors (CSF’s)?

Answer 3

SWOT analysis

Question 4

What are examples of KPI’s

Answer 4

○ Results-Oriented
- Sales volumes and revenues
- Rates of return in investment
○ Effort-Oriented
- Number of potential customers contacted
- Number of complaints

Question 5

What are 3 examples of KRI’s

Answer 5

○ IT downtime
○ Fraud
- Complaints

Question 6

What are the 4 perspectives of Balanced Scorecards

Answer 6

§ Internal
§ Financial
§ Customer
§ Learning and Growth
- Using a Holistic view of an organisation

Question 7

3 Perspectives of Benchmarking

Answer 7

○ Internal
○ External
- Functional

Question 8

Define Management of Objectives (MBO)?

Answer 8

○ Process of defining objectives within an organisation so that both management and employees agree to the objectives

Question 9

What are the 5 C’s of decision making?

Answer 9

• Consider
• Consult
• Crunch
• Communicate
• Check

Question 10

What is the Budgeting Process?

Answer 10

• Step by step approach
  ○ Drawn up for individual departments and functions
  
  • Guidelines from the chief executive
    ○ Issues general guidelines for the master budget to the principal heads of departments
    ○ Organisations performance in the financial year
    § Explaining differences
    ○ Expected changes in the business environment
  • Consolation and Preparation
    ○ Require consolation between a manager and their team members in order to gather information
  • Review by budget committee
    ○ Conform to the polices of the master budget
    ○ Show how departmental objectives are going to be achieved
    ○ Realistic?
    ○ Constraints
    ○ Financial reasonability’s of the department concerned
  • Communication
  • Monitoring

Question 11

6 Methods of Budgeting?

Answer 11

• Top Down
• Bottom-up
• Fixed Budget
• Flexible Budget
• Zero Based Budget
• Rolling Budgets

Question 12

What is Variance Analysis?

Answer 12

• Difference between actual and budgeted performance
  
  • Unfavourable
    ○ When budgets are not met
  • Favourable
• When budgets are exceeded

Question 13

4 Causes of variances?

Answer 13

• Inadequate Pricing
• Higher expenses than planned
• Random events
• Operating Efficiency

Question 14

What are the 3 types of information?

Answer 14

• Strategic Information (future objectives)
• Tactical Information (time, money)
• Operational Information (Day to day)

Question 15

What are the two types of knowledge management?

Answer 15

• Codification Strategy
• Personalisation Strategy