BUS 254 Lecture Notes - Lecture 10: Controllability

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 254
• Professor: matt martell

Document Summary

Service companies: critical factor in budgeting is coordinating staff needs w expected services, overstaff problems, disproportionately high labour costs, lower profits due to additional salaries. Increased staff turnover due to no challenging work: understaff problems, lost revenue cuz existing/prospective client needs for service unmet, loss of pro staff due to excessive work loads. Budgetary contrl: mjr fxn of mgm control operations, takes place by means of budget reports comparing actual results w planned objectives, provides mgmt w feedback w operations, works best when a company has a formalized reporting system. Static budget reports: projection of budget data at one lvl of activity, always compares actual results w budget data at activity lvl used in master budget about items. Flexible budget reports: projects budget data for various lvls of activity, essentially, a series of static budgets at diff activity lvls. Focus of top mgms"s review of a budget report: diff btwn actual and planned results, able to focus on problem areas.