Performance Measures Flashcards
1
Q
Benefits of PM
A
- Internal Measures- help investors see what managers think is important
- Better comparisons of other entities in the same sector.
- Strip out items not relevant to current or future operating performance
2
Q
Limitations of Measures
A
- Overly optimistic
- Disguise weak performance
- No standards- comparability harder
- No reconcilliation to FS
- Could be misleading if prominently displayed.
3
Q
A
