ACC 312 Midterm: Control
Document Summary
Control budgets are used for management motivational purposes and in this way influence improved departmental performance. Control and monitoring are the continuous comparison of actual results with those planned, both in total, and for the separate divisions within the organisation, and taking management action to correct adverse variances and to exploit favourable variances. Management control is the process by which managers assure that resources are obtained and used effectively and efficiently in the accomplishment of the organisation"s objectives. Operational control is concerned with day-to-day activities of organisations, and is the process of assuring that specific tasks are carried out effectively and efficiently. Whereas planning is achieved by means of a fixed master budget, control is generally exercised through the comparison of actual costs with a flexible budget. A flexible budget is a budget, which, by recognising different cost behaviour patterns, is designed to show changes in variable costs as the volume of activity of the organisation changes.
