ABSENT fiat, the form of organization that survives in an activity is the one that delivers the product demanded by customers at the lowest price while covering costs.1 Our goal is to explain the survival of organizations characterized by separation of "ownership" and "control"-a problem that has bothered students of corporations from Adam Smith to Berle and Means and Jensen and Meckling.2 In more precise language, we are concerned with the survival of organizations in which important decision agents do not bear a substantial share of the wealth effects of their decisions. We argue that the separation of decision and risk-bearing functions observed in large corporations is common to other organizations such as large professional partnerships, financial mutuals, and nonprofits. We contend that separation of decision and risk-bearing functions survives in these organizations in part because of the benefits of specialization of

/pdf/separation-of-ownership-and-control-3cs1pezwz4.pdf

Separation of ownership and control

This paper analyzes the survival of organizations in which decision agents do not bear a major share of the wealth effects of their decisions. This is what the literature on large corporations calls separation of ownership and control. Such separation of decision and risk bearing functions is also common to organizations like large professional partnerships, financial mutuals and nonprofits. We contend that separation of decision and risk bearing functions survives in these organizations in part because of the benefits of specialization of management and risk bearing but also because of an effective common approach to controlling the implied agency problems. In particular, the contract structures of all these organizations separate the ratification and monitoring of decisions from the initiation and implementation of the decisions.

https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID924170_code9.pdf?abstractid=94034&mirid=1&type=2

Separation of Ownership and Control

Contingency theories of management accounting have become a current vogue but have produced few significant new results. By surveying the development and content of these theories it is argued that they have been based on an inadequate and insufficiently articulated model. An improved model, based on ideas of organizational control and effectiveness, is put forward which suggests appropriate directions for future work that will be both perceptive and cumulative.

The contingency theory of management accounting: Achievement and prognosis

Innovative e-commerce ideas are characterised by commercial products yet unknown to the market, enabled by information technology such as the Internet and technologies on top of it. How to develop such products is hardly known. We propose an interdisciplinary approach, e3-value, to explore an innovative e-commerce idea with the aim of understanding such an idea thoroughly and evaluating it for potential profitability. Our methodology exploits a requirements engineering way of working, but employs concepts and terminology from business science, marketing and axiology. It shows how to model business requirements and improve business---IT alignment, in sophisticated multi-actor value constellations that are common in electronic commerce. In addition to the e3-value approach methodology, we also present the action research-based development of our methodology, by using one of the longitudinal projects we carried out in the field of online news article provisioning.

/pdf/value-based-requirements-engineering-exploring-innovative-e-3wbx1acmxm.pdf

Value-based requirements engineering: exploring innovative e-commerce ideas

Several accounting and other signals are generally available for the construction of a managerial performance evaluation measure on which an optimal compensation contract is based. The demand for aggregation in evaluating managerial performance arises because reporting all the basic transactions and other nonfinancial information about performance is costly and impracticable (see Ashton [1982], Casey [1978], and Holmstrom and Milgrom [1987]). We identify necessary and sufficient conditions on the joint density function of the signals under which linear aggregation, a simple and commonly employed way to construct a performance evaluation measure, is optimal. This characterization suggests that the linear form of aggregation is optimal for a large class of situations. Focusing on performance measures that are linear aggregates enables us to determine the relative weights on the individual signals in the optimal linear aggregate, since these weights are invariant for all realizations of the signals. We interpret these weights in terms of statistical characteristics (sensitivity and precision) of the joint distribution of the signals.

/pdf/sensitivity-precision-and-linear-aggregation-of-signals-for-3ym7maoizr.pdf

Sensitivity, Precision, and Linear Aggregation of Signals for Performance Evaluation

1. The Accountant's Role in the Organization. 2. An Introduction to Cost Terms and Purposes. 3. Cost-Volume Profit Analysis. 4. Job Costing. 5. Activity-Based Costing and Activity-Based Management. 6. Master Budget and Responsibility Accounting. 7. Flexible Budgets, Variances, and Management Control: I 8. Flexible Budgets, Variances, and Management Control: II. 9. Inventory Costing and Capacity Analysis. 10. Determining How Costs Behave. 11. Decision Making and Relevant Information. 12. Pricing Decisions and Cost Management. 13. Strategy, Balanced Scorecard, and Strategic Profitability Analysis. 14. Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis. 15. Allocation of Support Department Costs, Common Costs and Revenues. 16. Cost Allocation: Joint Products and Byproducts. 17. Process Costing. 18. Spoilage Rework, and Scrap. 19. Quality, Time, and the Theory of Constraints. 20. Inventory Management, Just-in-Time, and Backflush Costing. 21. Capital Budgeting and Cost Analysis. 22. Management Control Systems, Transfer Pricing, and Multinational Considerations. 23. Performance Measurement, Compensation, and Multinational Considerations.

/pdf/cost-accounting-a-managerial-emphasis-4wrngoxrq7.pdf

Cost Accounting: A Managerial Emphasis

Detailed contents Guided tour Guided tour of the MyLab Guide to the case studies Preface Acknowledgements Publisher's Acknowledgements PART I: MANAGEMENT AND COST ACCOUNTING FUNDAMENTALS 1 The accountant's role in the organisation 2 An introduction to cost terms and purposes 3 Job costing systems 4 Process costing systems 5 Cost allocation 6 Cost allocation: Joint cost situation 7 Income effects of alternative stock costing methods Part I Case study problems PART II: ACCOUNTING INFORMATION FOR DECISION MAKING 8 Cost-volume-profit relationships 9 Determining how costs behave 10 Relevant Information for decision making 11 Activity-based costing 12 Pricing, target costing and customer profitability analysis 13 Capital investment decisions Part II Case study problems PART III: PLANNING AND BUDGETARY CONTOL SYSTEMS 14 Motivation, budgets and responsibility accounting 15 Flexible budgets, variances and management control: I 16 Flexible budgets, variances and management control: II 17 Measuring yield, mix and quantity effects Part III Case study problems PART IV: MANAGEMENT CONTROL SYSTEMS AND PERFORMANCE ISSUES 18 Control systems and transfer pricing 19 Control systems and performance measurement Part IV Case study problems PART V: QUALITY, TIME AND THE STRATEGIC MANAGEMENT OF COSTS 20 Quality and throughput concerns in management costs 21 Accounting for just-in-time systems 22 Strategic management accounting and emerging issues Part V Case study problems Appendix A: Solutions to selected exercises Appendix B: Notes on compound interest and interest tables Bibliography Glossary Index of names General index

Management and Cost Accounting

Part 1 Focus on Decision Making 1 Managerial Accounting, the Business Organization, and Professional Ethics 2 Introduction to Cost Behavior and Cost-Volume Relationships 3 Measurement of Cost Behavior 4 Cost Management Systems and Activity-Based Costing 5 Relevant Information for Decision Making with a Focus on Pricing Decisions 6 Relevant Information for Decision Making with a Focus on Operational Decisions Part 2 Accounting for Planning and Control 7 Introduction to Budgets and Preparing the Master Budget 8 Flexible Budgets and Variance Analysis 9 Management Control Systems and Responsibility Accounting 10 Management Control in Decentralized Organizations Part 3 Capital Budgeting 11 Capital Budgeting Part 4 Product Costing 12 Cost Allocation 13 Accounting for Overhead Costs 14 Job-Costing and Process-Costing Systems Part 5 Basic Financial Accounting 15 Basic Accounting: Concepts, Techniques, and Conventions 16 Understanding Corporate Annual Reports: Basic Financial Statements 17 Understanding and Analyzing Consolidated Financial Statements

Charles T. Horngren

Papers

Cost Accounting: A Managerial Emphasis

Management and Cost Accounting

Introduction to Management Accounting