Management control system Q.1 (a)"In an organization, control involves a variety of functions. What are these functions ?

Briefly escri!e he there"tier s#ectrum of organizational #lanning an control. (!) "$he conce#t of res#onsi!ility is a logical e%tension oil the i ea of elegation of res#onsi!iiity an authority for elective management control," &%#lain. Whale car# he three 'ey #rinci#les elective control an management of o#erations ? Q.( (a) What ifferent conce#ts of #rofit coul !e consi ere in the measurement of #erformance of #rofit canters ? Which one )oul you recommen an )hy ? (!) &%#lain *egotiate +rice an ,##ortunity -ost as !ases for etermining transfer #ricing. What are their merits an emerits from the #ractical #oint of vie) ? Q.. (a) /iscuss the sco#e of 0le%i!le Bu geting, #ointing out its merits an emerits. (!) What !asic factors shoul gutte in esigning #erformance evaluation re#orting system ? &%#lain. Q.1 (a) What shirre !e the o!2ectives of Management -ontrol 3ystem in a Ban' ? /iscuss some of the in icators of #erformance in a Ban'. (!) What #ricing metho s coul !e use in a non#rofit organization ? Why shoul a non" #rofit organization have a reasona!le #ricing #olicy ? Q.4 )rite sho notes on the follo)ing 5 (a) &lements of a control system (!) +rofit centre as motivational tool (c) 6eturn on Investment 7##roach ( ) +erformance Bu geting Q.8 /iscuss the nee for MI3 in an organisation an e%#lain the im#ortant consi erations in esigning Management information 3ystem 9Ml3) for the #ur#ose of Management -ontrol Q.: ;ro)ing geogra#hical reach an e%#loration of ne) mar'ets has necessitate increase elegation an i eation of res#onsi!ility censes. &la!orate this statement giving reasons an e%am#les, Q.< Write short notes on the follo)ing 5 (i) 0le%i!le !ustling (ii) Balance 3core -ar (iii) $otal Quality Management ($QM) (iv) Management !y ,!2ectives (MB,) Q.= &%#lain in etail the ifferent> ty#es of ris's Ice !y the !an's an escri!e horn can these !e containe !y esigning #roffer management control system.

Q.1? &%#lain in etail the main elements of Management -ontrol 3ystem in evelo#ment organisations. Q.11 (a) What changes have to !e afflicte so that 6es#onsi!ility -entres meet the re@uirements of a ecentralize organization ? (!) "6es#onsi!ility 7ccounting forms a vital com#onent of M-3 in an organization." &%#lain the conce#t of 6es#onsi!ility 7ccounting an highlight its role in M-3. Q.1( (a)Why are #rofit centres esta!lishe ? What #ur#oses o they se)er ? (!) /istinguish !et)een 6,I an 6I in the conte%t of measurement of #erformance of investment centres. Which of the t)o retools, o you thin', is su#erior an )hy Q.1. What are the main #ur#oses of a##lying *et)or' 7nalysis in #re#aring !u gets ? &%#lain the istinct stages in #re#aring !u gets !ase on *et)or' 7nalysisA Q.11 (a) &%#lain the characteristics of a #ro2ect organization from the vie)#oint of Management -ontrol. (!) &%amine the #ro!lems relate to measuring the out#ut in non"#rofit organizations. 3uggest some of the )ays in )hich these #ro!lems can !e resolve . Q.14 &%#lain any three of the follo)ing 5 (a) $ransfer #ricing an -or#orate #olicy (!) +ur#ose an #rocess of #re#aring cash !u get (c) Management control in hos#itals ( ) +erformance !u geting (e) Myths a!out MI3 Q.18 (a)Bo) can $QM !e hel#ful in Management -ontrol ? Illustrate your ans)er. (!) Why are !ehavioural as#ects im#ortant in Management -ontrol ? Bo) can the un erstan ing of ifferent styles of management !e hel#ful in Management -ontrol ? Q.1: (a) &%amine the merits an emerits of #rofit centres. (!) /iscuss the issues of cor#orate #olicy that are concerne )ith $ransfer +ricing. Q.1< (a) &%#lain the #rocess of #re#aring 0le%i!le Bu getsA What are the limitations of fle%i!le !u gets ? (!)Bo) )oul you install an o#erate an 7ctivity Base -ost 3ystem ? What are its li'ely !enefits ? Q.1= (a)What are ifferent ty#es of ris's that the !an's ace ? &%amine the role of Management -ontrol 3ystem in containing these ris's. (!)What #ro!lems o the 3M&s generally face ? What are the im#lications of such #ro!lems onManagement -ontrol of 3M&s. Q.(? &%#lain any three of the follo)ing 5 (a) &thics an M-3

(!) $ransfer #ricing in actual #ractice (c) Business +rocess 6eengineering (B+6) ( ) ,verri ing o!2ectives of re)ar an com#ensation sCstem (e) -haracteristics of service organizations an their im#lications for M-3 Q.(1 -om#ute the change in 6esi ual Income (6I) from the follo)ing ne) investment

Total original cost of investment Additional net cash flow per year Minimum required rate of return #ife of the equipment

Rs. 2,00,000 Rs. 50,000 !" 0 years

7ssume straight"line e#reciation an no salvage value. Q.(((a) Management control system is gui e !y controlla!ility +rinci#al D&%#lain. (!) $he ultimate #ur#ose of management control is to achieve goal congruence. -omment. Q.(. $he #ro!lems in the esta!lishment of #rofit centre controls revolves areong the @uestions of measurement. -once#t of #rofit to !e use internal transfer #rice an the com#ensation !ase on evaluation. /iscuss. Q.(1 &valuate the 6,I system of #erformance evaluation in relation to management control. ;ive a##ro#riate e%am#les. Q.(4 /iscuss the factorEconsi erations involve in the management control multinational o#eras tiosn inclu ing economic an #olitical ris's. Q.(8 &%#lain any t)o fo the follo)ing (a) -haracteristics of management control system. (!) $ransfer #ricing an cor#orate #olicy. (- ) Measuring an controlling #erformance in an MB, frame)or' Q.(: What consi erations influence the esign fo a management control system in !usiness organisation? &%#lain )ith e%am#les. Q.(< /iscuss the issue that are concerne )ith the i entification of investment hase an the #erformance measurement of investment centres. Q.(= $here are certain im#ortant issue that nee to !e e%amine an sorte out !efore staring the etaile !u ge setting e%ercise. What are these issues? /iscuss )hat 'in of #roce ures oes a #rogressive com#any generally a o#t in relation to the !u get setting e%ercise? Q..? What #articulars issue may have to !e face in the management control system of a multinational enter#rise? /iscuss !riefly )ith suggestion to resolve them.

Q..1 What #lanning an control techni@ues can !e use in a #ro2ect organisation? /iscuss !riefly. Q..( /efining the !oun ary con itions in #rofit centres is an im#ortant as#ect of the esign of #rofit centres e%#lain Q... What measures can !e use or measuring #erformance of investment centres? /iscuss their relative merits an ementias. Q..1 (a) Managerial #erformance in a foreign su!si iary is ifferent form managerial #erformance sin omestic ivision. /o you agree )ith the statement? ;ive reasons. (!) )hat a 2ustments are commonly re@uire to the #rofit or loss figure of a foreign su!si iary in or er to arrive at the correct figure of #rofit or loss? Q..4(a) In )hat )ays is the management control in a non"#rofit organisation ifferent form a #rofit organisation? (!) /evelo# a #rogramme structure of a hy#othetical large non"#rofit organisation ( escri!e it o!2ective a actini es) #ointing out its out#uts an in icators for measuring out#uts. Q..8 (a) 6es#onsi!ility accounting )ithout res#onsi!ility re#orting is incom#lete. -omment on the statement !y fully e%#laining an illustrating the t)o terms. (!) 7n investment centre is necessarily a #rofit centre !ut a #rofit centre may to necessarily !e an investment centreF e%#lain )hat are the ifferent ty#es of influences )hich an investment centre meager may e%ercise on their vestment ecision realign to this /avi son? Q..: 7ssume that a com#any his #rofit centre !ase ivisions structure. What #ac'age of criteria coul the com#any a o#t? What oes each criterion #ur#ort to measure? Bo) )oul you ran' ifferent criteria an )hy? Q..< It is often state that management control ma'es the manager short term oriente . Bo) can this ten ency !e misname ? &%#lain !riefly. Q..= 7ll investment centres are #rofit centres, !ut all #rofit centres nee not necessarily !e investment centres &%#lain ho) )hat ifferent ty#es of influences may an invest met centres manager e%ercise on investment relating to his ivision? Q.1? /istinguish !et)een #erformance !u geting an zero"!ase !u geting. Which ty#es of actives are more suita!le for #erformance !u geting? Q.11 What ma2or management control issues are involve in #ro2ect organization? &%#lain the in icators that coul !e use for measuring the #rogress of #ro2ect.

Q.1( (a) Gn er )hat cor ites can an e%#enseEcost centre !ecome a res#onsi!ility sector? (!) -ontrolla!ility is an im#ortant conce#t in 6es#onsi!ility 7ccounting un er )hat circumstances can an control lia!le item !ecome controlla!le? &%#lain )ith e%am#les. Q.1. Write short notes on5 (a) Informal Management -ontrol (!) 0le%i!le Bu get ( -) +erformance &valuation of a ;overnment Bos#ital Q.11 /iscuss the general characteristics of a management control system. In )hat )ays is a management control system hel#ful to a large in ustiral enter#rise? Q.14 $he im#lementation of the #rofit centre conce#t necessitates the use of the transfer #ricing mechanism. /isuses. Briefly e%#lain some metho s of transfer #ricing an e%#lain their merits an ements. Q.18 What !u getary control? /iscuss the role of (i) Hero !ase Bu geting (iii) +erformance Bu geting an (iii) 0le%i!le Bu geting in !ucigetary control. Q.1: In )hat )ays oes the management control system in a non #rofit organization iffer form the one in an #rofit organisation? What 'ing of control in icators coul !e use for measuring the #erformance of a non #rofit organisation? Q.1< &%#lains any t)o of the follo)ing (a) Management control in !an's (!) -ontrolla!ility conce#t an 6es#onsi!ility 7ccor ing ( -) 6,I as a measure of #erformance for ivisions of a com#any Q.1= What is 6es#onsi!ility 7ccounting an )hat are the essential re@uirement for its effective function? 7re res#onsi!ility 7ccounting an 6es#onsi!le 6e#orting the same? Q.4? What coul !e some of the !ases for measuring #erformance of cost centres #rofit centres an investment centres? What are the merits an emerits of 6,I as a metho Emeasure of #erformance of investment centres? What alternative can !e there an ho) oes it ta'e care of the emerits of 6,I? &luci ate. Q.41 It is sometimes argue that the fle%i!le !u getary control a##roach (to cost control a##roach (to cost control) in #ro uction e#artments is o!solete. $he main arguments seem to !e that5 (a) +ro uction costs are ten ing to !ecome more an more fi%e #olicy costs. ,utsi e the of the e#artment manger. (!) Because of (a) there is no #oint in fle%ing the cost !u gets for ultimate com#arisons )ith actual costs an that this is a meaningless an )asteful e%ercise

(- ) $his mechanistic form fo control re@uires the involvement of managers in the selling of !u gets an this they can har ly o !ecause of the a!sence of necessary stan ar ata. /iscuss these #oints se#arately an a##raise the general argument. Q.4( In )hat )ays is the management control system in service organization ifferent form the management contra systems air manufacturing organisation? What changes have ta'en #lace the service in ustry over the last eca e or so an )hat im#lications o they have for management control. Q.4. Briefly e%#lain the follo)ing5 (a) $echni@ues for #lanning an control in a #ro2ect organisations (!) $ransfer #ricing an cor#orate #olicy Q.41(a) What are the ifferent conce#ts of #rofit that can !e use for measuring #erformance of #rofit centres? Which conce#t )oul you recommen an )hy? (!) /efining !oun ary con itions for #rofit centres is an im#ortant as#ect in the esign of #rofit centres &%#lain. Q.44 (a) What is economic ris'? What can a manager of an M*- su!si iary o to minimise the effect of such ris'? (!) What factors ma'e evaluation of an M*- su!si iary more ifficult than evaluation of a omestic ivision of a com#any? Briefly iscuss. Q.48 (a) &very res#onsi!ility centre manger in an organization is an e%#ense centre manager also. /o you agree )ith this statement? &%#lain your ans)er )ith suita!le e%am#les. (!) /ifferentiate !et)een fi%e an fle%i!le !u ges. What im#lication oes fle%i!le !u geting have for management control? Q.4: (a) What ste#s are involve esta!lishing res#onsi!ility centres? /iscuss. (!) In esigning an effective management control system some !asic consi erations shoul not !e overloo'e . What are these consi eration? &%#lain Q.4< &%#lain any t)o of the follo)ing (a) /ecision 3u##ort 3ystem (!) Minimising the si e effects of transfer #ricing system (c ) Measuring #erformance f investment centers Q.4= ,ne nee s to 'ee# some !asic consi erations in esigning an effective management control system. What are these !asic consi erations? &%#lain !y given e%am#les. Q.8? What metho s coul !e use for measuring the #erformance of investment centres? &%#lain the metho s !y clearly !ringing out the merits an eer its of each.

Q.81 ,ne nee s to 'ee# some !asic consi erations n esigning an effective management control systemF )hat are these !asic conservation ? e%#lain !y giving e%am#les. Q.8( What metho s coul !e use for measuring the #erformance of investment centres? &%#lain the metho s !y clearly !rining out merits an emerits of each. Q.8. What criteria coul !e use for evaluating the #erformance of a foreign su!si iary? Which one of the criteria is commonly use ? Whist factors coul create com#lication #erformance evaluation fo ifferent su!si iaries? Q.81 &%#lain any t)o of the follo)ing (a) Issue involve in )or'ing out a transfer #ricing systemE (!) -on itions that ma'e it necessary for a com#any to create res#onsi!ility centres. (- ) Ma2or issue involve in management control in #ro2ect organisations Q.84 (a) Management control system is gui e !y controlla!ility +rinci#le &%#lains (!) $he ultimate #ur#ose of management control is to achieve goal congruence. -omment. Q.88 the #ro!lems in the esta!lishment of #rofit centre controls revolves aroun the @uestion of measurement, conce#t of #rint to !e use . Internal transfer #rice an the com#ensation !ase on evaluation. /iscuss. Q.8: &valuate the 6,I system of #erformance evaluation in relation to management control. ;ive a##ro#riate e%am#les. Q.8< /iscuss the factorsEconsi eration involve in the management control of multinational o#erations, inclu ing economic an #olitical ris's. Q.8= &%#lain any t)o of the follo)ing (a) -haracteristics of management control system (!) transfer #ricing an cor#orate #olicy (c ) Measuring an controlling #erformance in an MB, frame)or' Q.:? (a) $he three tiers of organisation #lanning an control corres#on to the three levels of management foun in most #rivate sector organisations. &%#lain? (!) Management control is usually !it aroun financial res#onsi!ility D&la!orate an illustrate. Q.:1 (a) What ma2or ste#s are involve in the #rocess of esta!lishing res#onsi!ility centres? /iscuss (!) form management control #oint of vie), #rofit centres are su##ose to have motivational value. What arguments are usually a vance in su##ort of this statement.

Q.:( What im#ortant issues nee !e i entifie e%amine an resolve !efore stating etaile !u get e%ercise? /iscuss5 (a) &%#lain the main ementsEconsi erations of management control in #rofessional firms (!) Briefly iscuss the ifferent characteristics form manumit control #int of vie) !et)een #rofit an non"#rofit organist ionsE. Q.:. &%#lain any t)o of the follo)ing (a) -ontrol in icators in multi #ro2ect organisation. (!) Metho s of transfer #ricing other than mar'et or mart !ase #ri