tailieunhanh - Lecture Principles of accounting (2005): Chapter 26 - Needles, Powers, Crosson

Chapter 26 - Performance management and evaluation. Chapter 26 discusses how a manager measures, reports, and evaluates performance for various types of responsibility centers. The balanced scorecard is discussed and linked to the management cycle. The calculation of performance measures such as return on investment, residual income, and economic value added are covered. | Performance Management and Evaluation Multimedia Slides by: Gail A. Mestas, MAcc, New Mexico State University Chapter 26 Learning Objectives Describe how the balanced scorecard aligns performance with organizational goals, and explain the role of the balanced scorecard in the management cycle. Discuss performance measurement, and state the issues that affect management’s ability to measure performance. Learning Objectives (cont’d) Define responsibility accounting, and describe the role that responsibility centers play in performance management and evaluation. Prepare performance reports for cost centers using flexible budgets and for profit centers using variable costing. Learning Objectives (cont’d) Prepare performance reports for investment centers using traditional measures of return on investment and residual income and the newer measure of economic value added. Explain how properly linked performance incentives and measures add value for all stakeholders in performance management | Performance Management and Evaluation Multimedia Slides by: Gail A. Mestas, MAcc, New Mexico State University Chapter 26 Learning Objectives Describe how the balanced scorecard aligns performance with organizational goals, and explain the role of the balanced scorecard in the management cycle. Discuss performance measurement, and state the issues that affect management’s ability to measure performance. Learning Objectives (cont’d) Define responsibility accounting, and describe the role that responsibility centers play in performance management and evaluation. Prepare performance reports for cost centers using flexible budgets and for profit centers using variable costing. Learning Objectives (cont’d) Prepare performance reports for investment centers using traditional measures of return on investment and residual income and the newer measure of economic value added. Explain how properly linked performance incentives and measures add value for all stakeholders in performance management and evaluation. Organizational Goals and the Balanced Scorecard Objective 1 Describe how the balanced scorecard aligns performance with organizational goals, and explain the role of the balanced scorecard in the management cycle The Balanced Scorecard is a framework that links the perspectives of an organization’s four basic stakeholder groups with the organization’s mission and vision, performance measures, strategic plan, and resources Developed by Robert S. Kaplan and David P. Norton Four basic stakeholder groups of an organization Financial (investors) Learning and growth (employees) Internal business processes Customers The Balanced Scorecard (cont’d) To succeed, an organization must add value for all groups in both the short and long terms Must determine each group’s objectives Translate objectives into performance measures that have specific, quantifiable performance targets The Balanced Scorecard (cont’d) Managers must evaluate the company vision from the perspective of each