Unit 7 Management Reports

Unit 7 Management - BFA103 FINANCIAL ACCOUNTING AND DECISION MAKING TUTOR NOTES Unit 7 Management reports Chapter 9 Budgets Discussion Questions

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BFA103 FINANCIAL ACCOUNTING AND DECISION MAKING TUTOR NOTES Unit 7 – Management reports Chapter 9 - Budgets Discussion Questions 9.1 A budget can be defined as a financial plan for a future period of time. Thus, it sets out the intentions which management has for the period concerned. Achieving the budget plans should help to achieve the long-term plans of the business. Achievement of the long term plans should mean that the business is successfully working towards its objectives. A budget differs from a forecast in that a forecast is a statement of what is expected will happen without the intervention of management, perhaps because they cannot intervene as with a weather forecast. A plan is an intention to achieve. Normally management would take account of reliable forecasts when making its plans. 9.2 A series of long-term plans identify how the objective is to be pursued and budgets identify how the long-term plan is to be fulfilled. 9.19 Management by exception focuses on the aspects of the business where targets are not being met rather than on the areas where performance is on or above expectations (budget). 9.21 That aspect of the business that will stop it from achieving its objectives to the maximum extent (eg finance; specialist skills; scarce raw materials; machine time etc). The budgeting process must be geared to maximise the return on the scarce input factor (limiting factor). F ACULTY OF B USINESS UNIVERSITY OF TASMANIA 39
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BFA103 FINANCIAL ACCOUNTING AND DECISION MAKING TUTOR NOTES Chapter 10 – Projected financial statements Discussion Questions 10.3 There are a variety of methods: Aggregating sales force projection Statistical techniques Economic models 10.4 Realised in an accounting sense is related very much to assumptions that underlay
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This note was uploaded on 04/30/2011 for the course ECONOMIC 0053665 taught by Professor Allen during the Spring '10 term at American Baptist.

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Unit 7 Management - BFA103 FINANCIAL ACCOUNTING AND DECISION MAKING TUTOR NOTES Unit 7 Management reports Chapter 9 Budgets Discussion Questions

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