chapter 20

Question 1

strategic management accounting (SMA)

Answer 1

a form of management accounting which places emphasis on information which relates to factors external to the firm, as well as non-financial information and internally generated information. SMA is oriented towards the future and the enterprise’s position relative to that of its competitors. relevant factors include financial and non-financial elements, competitor activities, product characteristics, market share data, and other value-chain-related information.

Question 2

firm’s strategy

Answer 2

best described in terms of how an organisation uses its resources to accomplish specific market objectives.

Question 3

product differentiation

Answer 3

an organisation’s ability to offer products or services that are perceived by its customers to be superior and unique relative to those of its competitors.

Question 4

cost leadership

Answer 4

an organisation’s ability to achieve lower costs relative to competitors through productivity and efficiency improvements, elimination of waste, and tight cost control.

Question 5

balanced scorecard

Answer 5

translates an organisation’s mission and strategy into a comprehensive set of performance measures that provides the framework for implementing its strategy. it focuses on both financial and non-financial objectives.

Question 6

re-engineering

Answer 6

the fundamental rethinking and redesign of business processes in seeking to achieve improvements in critical measures of performance such as cost, quality, service, etc.