Management Control System
Subject Overview
Management Control System covers the design and implementation of control systems in organizations — strategic planning and behavioural aspects of control, responsibility centers and transfer pricing, the management control process (budgeting, balanced scorecard, variance analysis, activity-based costing), and management compensation and control in differentiated and multinational settings. A 4-credit core theory paper.
Unit-wise Syllabus
4 units — click WhatsApp below to get the full notes for each
Unit 1: Foundations of management control
Management control system basic concepts and boundaries, formal and informal systems, understanding strategies, interrelationship among strategic planning/management control/operational control, responsibility accounting, use of IT in control systems, behavioural aspects — goal congruence, motivation and morale, participative management
Unit 2: Structure of management control and transfer pricing
Responsibility centers — revenue, expense, administrative/support, R&D, marketing and profit centers, transfer pricing objectives and methods, arm's length principle, managing inter-departmental conflicts, international transfer pricing, measuring and controlling assets employed (EVA, ROI)
Unit 3: The management control process
Strategic planning and analysis of programmes, budget preparation process and budgetary control, balanced scorecard perspectives and implementation, interactive control and variance analysis, activity-based costing and management, ethical dimensions in management control, management audit
Unit 4: Compensation and control in complex settings
Types and principles of management compensation, linking rewards to performance, controls for differentiated strategies, control in service and non-profit organizations, management control in multinational and multi-project corporations — cultural differences, exchange rates, transfer pricing, ethical issues