Flashcards
Financial control L2
Cards in this deck (11)
- 1What are the benefits of tight system controls- increase the probability that organisational objectives will be achieved.
- lower the probability that major consequences will occur.
- provide a higher degree of certainty that people will act in the interest of the organisation. - 2What factors should be considered in the achievement of tight system controls- Defining the desired results areas
- The performance measures
- The reinforcement provided/ incentives - 3What should be considered when "defining the desired result areas"1) Congruence - suffer if managers don't interpret OO or performance dimensions used do not reflect true objectives
2) specificity & timeliness - Targets should be specific (aggregated & quantified) and in short time periods.
3) Communication & internalisation - Degree to which goals are understood and internalised are affected but several factors*.
4) Completeness - RC should encompass all information about an employees affect on a firms value and weighted accordingly to maintain balanced effort in various dimensions. - 4In what conditions is internalisation likely to be low- when goals seem unachievable
- desired result is considered uncontrollable
- those whose behaviour is being controlled have no participation in goal setting. - 5Explain performance measures in the achievement of tight system controls- Tight RC rely on the effective measurement of performance (POTU)
- 6Explain "reinforcement provided/ incentives" in the achievement of tight system controls- RC tighter when rewards/ punishments are significant and directly linked to accomplishment/ failure of desired results
- Direct-links between results and rewards have no buffer or ambiguity
- Definite - no excuses tolerated - 7Explain tighter preaction reviews- Reviews are more frequent, detailed and performed by diligent knowledge people.
- 8Explain tighter action accountability controls- The amount of controls generated depends on the characteristics of "the definitions of (un)desirable actions & effectiveness of action tracking system + reinforcement (rewards/punishment) provided.
- 9Explain definitions of (un)desirable actions (tight action accountability)- Definitions must be congruent, specific, well communicated and complete.
- Understood & accepted by those who behaviour is being controlled
- All significant (un) acceptable actions are defined. - 10Explain effectiveness of action tracking system (tight action accountability)- Employees should feel like their actions are noticed and quickly.
- 11Explain tighter action reinforcement- Making rewards and punishments more significant to affected employees
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- Flashcards on Financial control L2, created by Eric Sea on 29/12/2015.
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- Eric Sea
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