Study Notes management accounting acca f2

Brevity
Easy to understand and remember
 
▪ 
Flexibility
To accommodate change
 
▪ 
Distinctiveness
To make the firm stand out
 
 
Mission statement can play an important role in the planning process.
 
▪ Plans should outline the fulfilment of the organization’s mission. 
▪ Evaluate and screening (mission helps to ensure consistency in decisions) 
▪ Implementation (mission also affects the implementations of a planned strategy, in the culture and 
business practice of the firm)
 
Goals:
The goals set for different parts of the organization should be consistent with each other (
goal 
congruence
). There are two types of goals: 
Operational goals: 
Can be expressed as objectives. It can be measurable. For example, cut
cost, objective reduce budget by 10%. 
 
Non-operational goals: 
Not all the goals can be measured. For example, a university goal might 
be to seek the truth, this goal cannot be measured. 
 
Distinguish between goals and objectives 
Goals: 
▪ Goals will support the mission.
▪ This is primary long term objective of the organisation 
▪ Goals are the main purpose of the organization.
▪ This is at overall organizational level.
▪ Goals are decided at corporate planning stage by strategic management. 

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F2 Management Accounting
Page 108 of 147 
Objectives: 
▪ Objectives are sub-division of goals.
▪ Objectives are at departmental level.
▪ If the departments achieve their objectives, the organization will achieve its goal.
 
Objectives usually are smart 
▪