ACCT10001 Chapter Notes - Chapter 9: Balanced Scorecard, Budget, Strategic Planning
5 Aug 2018
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Strategic planning relates to longer term planning (3-5 years) by senior management expansion, business takeovers, deletion of business segments, and radical product/ service development. Larger entities more formal smaller entities less formal. Budgeting: short term possibly one year focuses on setting the financial framework for that period they operationalize the strategic plan. Performance management: setting targets in other than just financial terms, for example improving customer service, corporate governance, management techniques and human resources management. Recent innovation of balanced scorecard: balanced mix of financial/non-financial measures. Non financial measures developed at two levels: And more specific operational measures suitable for specific segments/ activities of the entity. A budget is basically the quantitative expression of an entity"s plans. May take 9 months of year to finalize budget. Three wheels: cash, profit, return on investment. Commonly used to set expected level of activity for budget period; important consideration for many of other budgets. Simon"s three wheels of planning? (operating) expenses budget:
