Deck 12: Strategy and Control

Question 1

Management accounting is now seen as a useful vehicle by which to implement economic theory and social and environmental change.

Answer 1

A

Question 2

Porter classifies strategy into either cost leadership or product differentiation.

Answer 2

A

Question 3

The value-based management (VBM) technique was proposed by Kaplan and Norton.

Answer 3

B

Question 4

A Ferdinand's 'flattner' in his discussion of 'flat world' theory is:

A) the development of the Internet
B) outsourcing
C) the rise of the personal computer
D) all of the above are 'flattners'.

Question 5

Ferdinand's view of the 'Flat World' involves moving back to embrace the best of the past features of management accounting.

Question 6

The author of many works that attempt to define strategy is:

A) Ferdinand
B) John Marsden
C) Porter
D) Tim Winton

Question 7

Management control systems have one main role; to facilitate decisions by providing relevant and timely information to support decision making.

Question 8

'Control' in the text, is commonly used as a short-form term for managerial control and/or managerial control system tools.

Question 9

Prior to the 1980's accounting for internal control did not have a strategic component.

Question 10

In management accounting, designing and managing global networks, controlling them through techniques such as empowerment and creating value through integration is known as:

A) network orchestration
B) management control
C) flat earth theory
D) inter-globalisation

Question 11

'The Forgotten Garden' by Kate Morton, was published in 2008.

Question 12

Lean accounting initiatives are based on the belief that only a small fraction of the total time and effort in an organisation actually adds value for the end customer.

Question 13

Rather than having a backward focus strategic management accounting looks to the future.

Question 14

Good internal control systems should aim to eliminate risk.

Question 15

Overproduction is a non-value added activity.

Question 16

Which of these are is not included within the scope of current management accounting?

A) Consideration of environmental issues
B) Consideration of intangible assets
C) Compliance with international accounting standards
D) None of the above, i.e. all are included within the scope of current management accounting

Question 17

Strategic management accounting is essentially theoretical in nature.

Question 18

The value-based management (VBM) technique takes a holistic approach to the management of an organisation and focuses on the underlying 'drivers' of value.

Question 19

Ferdinand's 'flattners' involve accelerating the connecting of the unconnected.

Question 20

Early writers on strategic management believed that better control would occur within an organisation if the management accounting function was more closely aligned to the financial accounting.

Question 21

Which of these is not a financial performance measure?

A) share price
B) economic value added
C) return on investment
D) none of the above, i.e. all are financial performance measures

Question 22

Under the Ittner and Larcker management framework which of these is not a limitation of using Economic Value Added (EVA) as a measure of value added by management?

A) It is based on short-term performance
B) EVA can only be calculated for stock exchange listed companies.
C) It is a measure of the past
D) None of the above, i.e. all are limitations

Question 23

A broad view of management control might encompass which of the following?

A) coordination
B) communication
C) planning
D) all of the above

Question 24

Contemporary management accounting topics include all of these, except:

A) sustainable accounting
B) central planning versus an unplanned economy
C) risk management control
D) none of the above, i.e. all of these topics are covered by contemporary management accounting

Question 25

Managers consider a few general strategy types in their decision making processes, including: I $\quad$ Cost leadership
II $\quad$ Product differentiatior
III $\quad$ Target costing

A) II and III only
B) I and III only
C) I and II only
D) I, II, and III

Question 26

Strategy can be viewed at which level?

A) Business unit level
B) Task level
C) Corporate level
D) both a and b

Question 27

The person(s) most closely associated with the 'levers of control framework' that has informed study in the area of management accounting and control is:

A) Simons
B) Kaplan and Norton
C) Otley
D) Ittner and Larcker

Question 28

The 'lean' accounting principle is:

A) cost volume profit
B) capital budgeting
C) just in time inventory management
D) all are lean accounting principles

Question 29

In Porter's competitive forces model which of the following is a decision influencing control tool rather than a decision facilitating control tool?

A) cost data for pricing purposes
B) discounted cash flow analysis
C) budget targets
D) all are decision influencing control tools

Question 30

Which of these is not one of the key questions in Otley's performance management systems framework?

A) What are the key performance measures?
B) What products or services does the organisation provide
C) What are the key success factors?
D) None of the above, i.e. all are key questions

Question 31

Which of these is a key influence on the nature of control systems in the Simons's 'levers of control' framework ?

A) boundary systems
B) diagnostic systems
C) belief systems
D) a and b

Question 32

The statement that is incorrect concerning the 'StratEx' (strategic expenditure) component under the Kaplan and Norton's framework, is:

A) This type of expenditure should have its own line in the income statement.
B) This type of expenditure is generally given priority by the firm above more routine types of expenditure
C) This type of expenditure generally involves investment assets that require a different form of analysis to tangible assets,
D) This type of expenditure does not always have a simple causal relationship with sales and operating levels
E)g. research and development, training.

Question 33

A future direction which enables the focusing of an organisation's resources and decision making around a common theme, is a definition of:

A) budgeting
B) control
C) planning
D) strategy

Question 34

Which of these is an informal control mechanism as opposed to a formal mechanism?

A) social work settings
B) one-on-one consultations between senior managers
C) the influence of the owner/founder
D) all are informal control mechanisms

Question 35

Under the Kaplan and Norton strategy map framework preparing budgets comes under which stage?

A) Translating the strategy
B) Planning operations
C) Developing the strategy
D) Monitoring and learning