operating budgets and limited resources

Question 1

what is feedback control

Answer 1

is the comparison between budget and actual

Question 2

when does feedback control take place and why

Answer 2

after the event - ex post control. the intention is to ascertain where things have not gone as expected

Question 3

what is feedforward control

Answer 3

where we monitor performance of the organisation throughout the budget year and each month based on the actual results we re forecast the whole year. then we compare the new forecast with the original budget to understand why they are different and what needs to happen if we want to get back on track

Question 4

what is contingency theory

Answer 4

the premise of contingency theory is that there is no universally appropriate accounting system applicable to all organisations in all circumstances