Scope of control
MANAGEMENT CONTROL SYSTEM is an important process in which accounting information is used to accomplish the organizations objectives. Therefore the scope of control is very wide which covers a very wide range of management activities.
Policies control:
Success if a business depends on formulation of sound policies and their proper implementation.
Control over organization:
It involves designing and organizing the various departments for the smooth running of the business. It attempts to remove the causes of such friction and rationalizes the organizational structure as and when the need arises.
Control over personnel:
Anything that the business accomplishes is the result of the action of those people who work in the organization. It is the people, and not the figures, that get things done.
Control over costs:
The cost accountant is responsible to control cost sets, cost standards, labour material and over heads. He makes comparisons of actual cost data with standard cost. Cost control is a delicate task and is supplemented by budgetary control systems.
Control over techniques:
It involves the use of best methods and techniques so as to eliminate all wastage sin time, energy and material. The task is accomplished by periodic analysis and checking of activities of each department with a view to avoid an eliminate all non-essential motions, functions and methods.
Control over capital Expenditure:
Capital budget is prepared for the whole concern. Every project is evaluated in terms if the advantage it accrues to the firm. For this purpose capital budgeting, project analysis, study of cost of capital etc are carried out.
Overall control :
A master plan is prepared for overall control and all the departments of the concern are involved in this procedure.