Cost Accounting Reading Notes

Reading notes 2

Kaplan & Norton

1. a scorecard should contain outcome measures and the performance drivers of outcomes, linked together cause-and-effect relationships.

2. Financial and non-financial measures should be derived from the business-unit’s unique strategy

3. Should use scorecard as communication, information, and learning system, not as traditional control system.

4. Four perspectives permit linkage between: st and lt, desired outcomes and their drivers, harder and softer objective measures,

5. Stages: early stage (rapid growth), sustain stage (required to earn excellent returns), mature stage (harvest)

6. Three financial themes: revenue growth and mix, cost reduction/productivity improvement, asset utilization/investment strategy

7. Customer: market share, retention, acquisition, satisfaction, profitability, CustomerValue Propositions

8. Product/service: customer relationship, image and reputation, internal business processes

9. Strategic vs. diagnostic measures

Becker, Brian, etc.

1. HR should be managed as a strategic asset

2. The cost of people are easy to see but the value creation is not.

3. HR can be a strategic asset because the ability to execute strategy well is a source of competitive advantage. Also, strategy implementation is driven by employee strategic focus.

4. Link the perspective of HR with the strategy map provides a solution.

Lev, Philip

1. Challenge of intangible asset: valuation and performance measurement. Why? High uncertainty concerning the performance and outcome/ no markets for most intangibles, no comparative data for valuation

2. Linkages:

a. Inputs and outputs

b. R&D: expenditurespatentinnovation revenues

c. Customer acquisition: expenditures retentionrevenue from new customers

Lev’s book:

1. The lac of public information contributes to a higher cost of capital and affords abnormally large gains to insiders at the expense of...