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Unformatted text preview: PA2 重重重重 Performance measure - Bonus system ( Case 3 ◇ 重5重6重16重17重18 ) : (1) 发发发发发发发发 1 It should align manager / staff’s interests to that of the overall firm. ( 发发发 align manager decisions with corporate long-term goal) 2 Consider the cost-volume-profit factors 3 Different performance evaluation and controls should be implemented in order to ensure motivation is consistent with desired result and behavior and ensure there are no conflicts. (发发发发发发发发发发发发发发发发) 4 Consider the long-term effects (interests) for the company as well as short-term. ( Goal congruence between long-term and short-term and reduce the incentive to engage in short-range practices to pump up current earnings to the detriment of future earnings) 5 Using balanced scorecard approach to assess management performance based on the qualitative and quantitative factors. (consider the key success factors) (2) 发发发发发发发发发发发It should avoid the behavior of earnings management using by mangers (Earnings management often involves managers aiming earnings to an amount that maximizes their compensation package. Tools for control of earnings management include auditors, regulators, the board of directors, and the managerial labour market) (3) 发发发发发发发发发发The bonus may sets expectations for future projects and other employees may expect similar rewards in the future. (4) 发发发发发发Motivate better performance, control, long-term development of company. (5) 发发发发 current bonus system: Redesign the performance incentive program to ensure that employee (or manager) and company goals are more congruent. 1 Evaluating performance based on a longer term instead of one year result. 2 Allocate the bonus based on several months instead of a year. 3 Increase the considering factors for whether to award for bonuses. ( balanced scorecard: financial performance发learning and growth发customer satisfactory发internal business efficiency) Strategic leadership (Case 1 ◇ 重3重4重5重17重18重20) <1> 发发发发发 (Budget and Benchmarks) : Benchmarks: The Company can establish annual benchmarks to measure its success in moving toward this goal. ① Budget: The Company should establish a budget based ② on the Benchmarks and reasonable expectation. <2> 发发发发发发发发发发发(strategic-planning tool)发SWOT Analysis (发发发发发发发发发发发发发发) Strengths ① 发发发发: People发technology发management发corporate policies发brand and high reputation (wide client group)发bonus system发supplier Weaknesses ② 发发发发: 发发发发 ( turnover of people) Opportunities ③ 发发发发: Expansion （ Increasing demand （ Threats: Potential Competitors ④ 发发发发发high technology requirement(high-tech staffs)发potential threats for the weak internal control <3> 发发发发发发( Business strategy to create a competitive advantage)发Cost leadership (Cost control – ABC to better...
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- Spring '11
- Balance Sheet, Generally Accepted Accounting Principles