Control,
Motivation,
Congruence
Technical &
Method of
Control
Balanced
Scorecard
Approach
Empowering
Employees
Incentive
Systems
100
In management accounting, control is a set of ____ that organizations use to guide employees to achieve objectives. Fill in the blank with: A. Procedures B. Tools C. Performance measures D. Systems E. Incentives F. All of the above
F
100
What are the two broad technical characteristics that designers of MACS must address? How do they measure these characteristics?
What is 1. Relevance of the information generated - Accurate - Timely - Consistent - Flexible 2.Scope of the system - Comprehensive
100
True or false? Using multiple measures of performance helps employees focus on several dimensions of their jobs rather than just one dimension
What is True
100
What are the two essential elements of empowering employees in MACS design?
What is 1. Allowing employees to participate in decision making 2. Ensuring that employees understand the information they are using and generating (and being evaluated on)
100
True or False: All studies show a positive correlation between executive compensation and shareholder wealth.
What is False
200
1. What is the role of management according to the Scientific Management School (Taylorism)? 2. What are two of the central assumptions of this view?
What is : Role of management -Behavior should be monitored and controlled very carefully -Provide incentives to perform job in the designated “best way” Central assumptions -People find work objectionable and do not want to make decisions or exercise creativity on the job -Money is the major driver of performance -Employees should follow highly detailed, prescribed procedures developed by experts (industrial engineers) by breaking down tasks to small parts (“science” for each part; time and motion studies)
200
Define task control and results control
What is 1) Task control - process of finding ways to control behavior so that a job is completed in a pre-specified manner 2) Results control - measuring employee performance against stated objectives
200
True or false? Many organizations have begun to move away from organizations with fewer layers (flat organizations) to those with many layers of management (tall organizations).
What is False
200
Which of the following types of budgets empowers employees the most? A. Authoritative B. Participative C. Consultative D. None of the above
What is B. Participative
200
Name and describe the two types of reward systems that motivate employees.
What is 1) Intrinsic rewards (not affected by MACS): reflect Satisfaction from doing the job Growth opportunities the job provides 2) Extrinsic rewards: motivate desired behavior by providing an explicit (often financial) reward based on assessed performance
300
What is the role of management according to the Human Resources Model of Motivation (HRMM)? What are two of the central assumptions of this view?
What is : Role of management - Improve the quality of working life - Introduce employee responsibility for and participation in decisions in the work environment Central assumptions - Organizations operate under a system of beliefs about the values, purpose, and direction of their organization - People find work enjoyable and desire to participate in developing objectives, making decisions, and attaining goals in their work environment - Individuals are motivated by both financial and nonfinancial means of compensation - Employees have a great deal of knowledge and information about their jobs, and can therefore improve the way they perform tasks and benefit the organization as a whole - Individuals are highly creative, ethical, and responsible - Employees desire opportunities to produce constructive changes in their organizations
300
Provide and explain the two task control categories
What is 1. Preventive control - Little discretion in performing a task; possibly performed by machine or computer 2. Monitoring - Inspecting the work or behavior of employees while they are performing a task (listening or camera surveillance)
300
Nonfinancial measures of performance include all of the following EXCEPT: A. Market share B. Cycle time C. Defect rate D. Gross margin
What is D. Gross margin
300
____ exceed previous targets by a significant amount and usually require an enormous increase in a goal over the next budgeting period. A. Tight budgets B. Participative budgets C. Stretch targets D. Consultative budgets
What is C. Stretch targets
300
Name three features of performance-based incentive systems.
What is 1) Clear relationship between actions and rewards 2) Salary, bonus, or stock rewards? (Current or deferred rewards?) 3) Reward individual or group (firm) performance? 4) Reward only controllable performance? 5) Reward inputs or outputs? 6) Financial or nonfinancial performance? 7) Absolute or relative performance? 8) Objective or subjective evaluation?
400
Name three consequences of failing to consider behavior when implementing a MACS
What is 1) Low (or no) goal congruence 2) Low motivation 3) Dysfunctional behavior
400
Task control is most effective in which of the following situations: A. When organization members understand the organization’s objectives and their contribution to those objectives B. When organization members have the knowledge and skill to respond to changing situations by taking corrective actions and making sound decisions C. When the organization can control its environment and eliminate uncertainty and the need for judgment. D. When the performance measurement system is designed to assess individual contributions so that an individual can be motivated to take action and make decisions that reflect his or her own and the organization’s best interests.
What is C. When the organization can control its environment and eliminate uncertainty and the need for judgment.
400
What is the single most important factor in making major changes to an organization? A. Having employee support B. Having top management support C. Maintaining a static balanced scorecard D. Communicating the changes to shareholders
What is B. Having top management support
400
Problem 9-77 Part (a)?
What is Consultative
400
Which of the following incentive compensation plans does NOT rely on internal measures provided by the management accounting system? A. Cash bonus B. Profit sharing C. Stock options D. Gainsharing
What is C. Stock options
500
Name and describe three dysfunctional behaviors.
What is 1) Gaming the performance indicator - Altering job-related actions in an attempt to manipulate a performance indicator (for example, sales pressure or on-time delivery) 2) Data falsification - Knowingly altering records 3) Smoothing - A form of earnings management that accelerates or delays the flow of data without altering the organization’s activities
500
Results control is most effective for which of the following individuals: A.Pharmacist B. Vacuum cleaner salesman C.Banker D.Pilot
What is B. Vacuum cleaner salesman
500
An employee may feel threatened by change for all of the following reasons EXCEPT: A. Potential loss of job B. Increase in responsibility C. Change in compensation D. None of the above
What is D. None of the above
500
What are advantages and disadvantages associated with each of the three different types of budgets (authoritative, participative, and consultative)?
What is Solution discussed with class.
500
Which of the following incentive compensation plans can be based on individual, as opposed to group, performance? A. Cash bonus B. Profit sharing C. Stock options D. Gainsharing
What is A. Cash bonus
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