How To Rejuvenate A Mature Bus

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as controversial by Drury but is now considered of key importance to manufacturing industries aiming to become world class. This essay aims to discuss the ways in which new management accounting techniques can bring life into mature businesses, in particular those using non-financial measures.
Most companies still use the same cost accounting and management control systems that were developed decades ago in a competitive environment drastically different from today. These systems have major drawbacks described below:
�h They distort product costs i.e. absorption of production overheads into product costs for the purpose of stock valuation. The external financial reporting process was purely driving this allocation of overheads for stock valuation.
�h They do not produce the key non-financial data required for effective and efficient operations, hence they are of little help to operating managers�� seeking to reduce costs and improve productivity.
�h The data produced reflected on ...

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that during hard times, when sales were decreasing and operating costs were increasing, ROI targets could still be achieved through financial entrepreneurship by reducing discretionary expenses and exploiting accounting conventions. The creation of wealth through these activities will not help companies survive as world-class competitors.

Problems of ROI are only surfacing now because of:
�h the difference in size of organisations, changes in the competitive environment and the rapid movement of technology
�h less pressure for short-term financial performance in the last two decades
�h current managers have little knowledge of their organisation��s technology hence they rely ...

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