听说ACCA考试挺难，是真的吗？

正确答案：

(iii) The marketing director is certainly correct in recognising that success is dependent on levels of service quality provided
by HFG to its clients. However, whilst the number of complaints is an important performance measure, it needs to be
used with caution. The nature of a complaint is, very often, far more indicative of the absence, or a lack, of service
quality. For example, the fact that 50 clients complained about having to wait for a longer time than they expected to
access gymnasium equipment is insignificant when compared to an accident arising from failure to maintain properly a
piece of gymnasium equipment. Moreover, the marketing director ought to be aware that the absolute number of
complaints may be misleading as much depends on the number of clients serviced during any given period. Thus, in
comparing the number of complaints received by the three centres then a relative measure of complaints received per
1,000 client days would be far more useful than the absolute number of complaints received.
The marketing director should also be advised that the number of complaints can give a misleading picture of the quality
of service provision since individuals have different levels of willingness to complain in similar situations.
The marketing director seems to accept the current level of complaints but is unwilling to accept any increase above this
level. This is not indicative of a quality-oriented organisation which would seek to reduce the number of complaints over
time via a programme of ‘continuous improvement’.
From the foregoing comments one can conclude that it would be myopic to focus on the number of client complaints
as being the only performance measure necessary to measure the quality of service provision. Other performance
measures which may indicate the level of service quality provided to clients by HFG are as follows:
– Staff responsiveness assumes critical significance in service industries. Hence the time taken to resolve client
queries by health centre staff is an important indicator of the level of service quality provided to clients.
– Staff appearance may be viewed as reflecting the image of the centres.
– The comfort of bedrooms and public rooms including facilities such as air-conditioning, tea/coffee-making and cold
drinks facilities, and office facilities such as e-mail, facsimile and photocopying.
– The availability of services such as the time taken to gain an appointment with a dietician or fitness consultant.
– The cleanliness of all areas within the centres will enhance the reputation of HFG. Conversely, unclean areas will
potentially deter clients from making repeat visits and/or recommendations to friends, colleagues etc.
– The presence of safety measures and the frequency of inspections made regarding gymnasium equipment within
the centres and compliance with legislation are of paramount importance in businesses like that of HFG.
– The achievement of target reductions in weight that have been agreed between centre consultants and clients.
(Other relevant measures would be acceptable.)

正确答案：

This question requires candidates to consider the law relating to terms in contracts. It specifically requires the candidates to distinguish between terms and mere representations and then to establish the difference between express and implied terms in contracts.
(a) As the parties to a contract will be bound to perform. any promise they have contracted to undertake, it is important to distinguish between such statements that will be considered part of the contract, i.e. terms, and those other pre-contractual statements which are not considered to be part of the contract, i.e. mere representations. The reason for distinguishing between them is that there are different legal remedies available if either statement turns out to be incorrect.
A representation is a statement that induces a contract but does not become a term of the contract. In practice it is sometimes difficult to distinguish between the two, but in attempting to do so the courts will focus on when the statement was made in relation to the eventual contract, the importance of the statement in relation to the contract and whether or not the party making the statement had specialist knowledge on which the other party relied (Oscar Chess v Williams (1957) and Dick
Bentley v Arnold Smith Motors (1965)).
(b) Express terms are statements actually made by one of the parties with the intention that they become part of the contract and
thus binding and enforceable through court action if necessary. It is this intention that distinguishes the contractual term from
the mere representation, which, although it may induce the contractual agreement, does not become a term of the contract.
Failure to comply with the former gives rise to an action for breach of contract, whilst failure to comply with the latter only gives rise to an action for misrepresentation.

Such express statements may be made by word of mouth or in writing as long as they are sufficiently clear for them to be enforceable. Thus in Scammel v Ouston (1941) Ouston had ordered a van from the claimant on the understanding that the balance of the purchase price was to be paid ‘on hire purchase terms over two years’. When Scammel failed to deliver the van Ouston sued for breach of contract without success, the court holding that the supposed terms of the contract were too
uncertain to be enforceable. There was no doubt that Ouston wanted the van on hire purchase but his difficulty was that
Scammel operated a range of hire purchase terms and the precise conditions of his proposed hire purchase agreement were
never sufficiently determined.
Implied terms, however, are not actually stated or expressly included in the contract, but are introduced into the contract by implication. In other words the exact meaning and thus the terms of the contract are inferred from its context. Implied terms can be divided into three types.
Terms implied by statute
In this instance a particular piece of legislation states that certain terms have to be taken as constituting part of an agreement, even where the contractual agreement between the parties is itself silent as to that particular provision. For example, under s.5 of the Partnership Act 1890, every member of an ordinary partnership has the implied power to bind the partnership in a contract within its usual sphere of business. That particular implied power can be removed or reduced by the partnership agreement and any such removal or reduction of authority would be effective as long as the other party was aware of it. Some implied terms, however, are completely prescriptive and cannot be removed.
Terms implied by custom or usage
An agreement may be subject to terms that are customarily found in such contracts within a particular market, trade or locality. Once again this is the case even where it is not actually specified by the parties. For example, in Hutton v Warren (1836), it was held that customary usage permitted a farm tenant to claim an allowance for seed and labour on quitting his tenancy. It should be noted, however, that custom cannot override the express terms of an agreement (Les Affreteurs Reunnis SA v Walford (1919)).
Terms implied by the courts Generally, it is a matter for the parties concerned to decide the terms of a contract, but on occasion the court will presume that the parties intended to include a term which is not expressly stated. They will do so where it is necessary to give business efficacy to the contract.

Whether a term may be implied can be decided on the basis of the officious bystander test. Imagine two parties, A and B, negotiating a contract, when a third party, C, interrupts to suggest a particular provision. A and B reply that that particular term is understood. In just such a way, the court will decide that a term should be implied into a contract.
In The Moorcock (1889), the appellants, owners of a wharf, contracted with the respondents to permit them to discharge their ship at the wharf. It was apparent to both parties that when the tide was out the ship would rest on the riverbed. When the tide was out, the ship sustained damage by settling on a ridge. It was held that there was an implied warranty in the contract that the place of anchorage should be safe for the ship. As a consequence, the ship owner was entitled to damages for breach of that term.
Alternatively the courts will imply certain terms into unspecific contracts where the parties have not reduced the general agreement into specific details. Thus in contracts of employment the courts have asserted the existence of implied terms to impose duties on both employers and employees, although such implied terms can be overridden by express contractual provision to the contrary.

正确答案：
(b) Recent corporate scandals have increased the critical awareness of the need for business to operate ethically and in a socially
responsible way. This is seen largely in the context of large firms and their governance but as the Concrete Solutions scenario
shows small owner-managed firms are not immune from taking difficult decisions that have differing and significant impacts
on the firm’s stakeholders and their expectations. Johnson, Scholes and Whittington see corporate social responsibility as
‘concerned with the ways in which an organisation exceeds the minimum obligation to stakeholders specified through
regulation and corporate governance’. They argue it is useful to distinguish between contractual stakeholders including
customers, suppliers and employees, who have a legal relationship with an organisation and community stakeholders – such
as local communities – who do not have the same degree of legal protection as the first group. Clyde’s local community and
its representatives will face a dilemma – jobs v pollution – not an easy choice! Clearly there will be considerable negotiation
between the key stakeholders and Clyde as the owner/manager should act ethically and with integrity in reaching a decisionhaving profound effects for all parties concerned.

正确答案：

Tutor note: This is a detailed solution and candidates would not be expected to produce an answer of this length.

(a) Weaknesses in the current budget process at Perkin

Perkin uses a traditional approach to budgeting, which has a number of weaknesses.

First of all the budgeting system does not seem aligned with Perkin’s corporate objective which focuses on innovation and continuous product improvement. Innovation is a key competitive advantage to both component and device manufacturers in this industry and the products which incorporate Perkin’s components are subject to rapid technological change as well as changes in consumer trends. The markets in which the two divisions operate appear to be evolving, as seen by the high popularity of the smartphone model which was designed for playing games. This may mean the distinction between smartphone and gaming devices could be becoming less clear cut. Management time would probably be better spent considering these rapid changes and currently the budgeting process does not facilitate that.

In reality, the budget process at Perkin is time consuming and probably therefore a costly exercise. Divisional budgets go through a lengthy process of drafting and then revision by the main board before they are approved. The approval often happens after the start of the period to which they relate, at which point the budgets are already out of date. This also means divisional managers are trying to plan activities for the next financial year without a set of finalised targets agreed, which could impact the effectiveness of decisions made.

Another weakness is that the budgets are only prepared annually, which is clearly too infrequent for a business such as Perkin. The process is also rigid and inflexible as deviations from the planned targets are not tolerated. Sticking to rigid, annual budgets can lead to problems such as P Division not being able to cope with increasing popularity of a particular product and even other short-term changes in demand like those driven by seasonal factors, or one-off events such as the factory fire. Linked to this problem of budgetary constraints is that to cut costs to achieve the budgeted net profit, managers closed one of the three research and development facilities in G Division. As identified at the outset, a successful research and development function is a key source of long-term competitive advantage to Perkin.

It also appears that Perkin fails to flex the budgets and consequently the fixed budgets had discouraged divisional managers from deviating from the original plan. P Division did not make technical modifications to its components due to the cost of doing so, which meant they were unable to supply components for use in the new model of smartphone and had to discount the inventories of the old version. It is unclear why G Division did not take on additional staff to cope with increased demand following reopening of their customer’s factory, but it may be because managers felt constrained by the budget. This then caused long-term detriment to Perkin as they lost the preferred supplier status with their main customer.

Another problem created by annual budgeting is the management of short-term changes in costs and prices. A key component of Perkin’s products is silver, which fluctuates in price, and though it is not clear how much effect this has on Perkin’s costs, any problems in supply could disrupt production even if only a small amount of silver were required. Also Perkin exports goods worldwide and probably also purchases materials, including silver, from overseas. The business is therefore exposed to short-term movements in foreign currency exchange rates which may affect costs and selling prices.

Similarly, there also seems to be considerable uncertainty in sales volumes and prices which creates problems in the forecasting process for the two divisions. P Division did not anticipate the high demand for the new component which meant P Division had to discount products it had already manufactured in order to achieve its forecast sales volumes. G Division did correctly forecast the demand, but based on past growth in the market which may be too simplistic in a rapidly changing industry. Lack of up-to-date information will hinder decision-making and overall performance at Perkin. Perkin would perhaps be better adopting a rolling basis for forecasting.

The two divisions share manufacturing facilities and are likely to compete for other resources during the budgeting process. The current budgeting system does not encourage resource, information or knowledge sharing, for example, expertise in forecasting silver requirements. Divisional managers are appraised on the financial performance of their own division and hence are likely to prioritise the interests of their own division above those of Perkin as a whole. P Division would not re-allocate its manufacturing facilities to G Division, even though G Division needed this to cope with extra demand following reopening of the customer’s factory. The current system is therefore not encouraging goal congruence between the divisions and Perkin as a whole and a budgeting system, if done effectively, should encourage co-ordination and co-operation.

Managers may find the budgeting process demotivating because it is time-consuming for them and then the directors override the forecast which they had made. It is also unfair and demotivating to staff to appraise them on factors which are outside their control. This also identifies another weakness in Perkin’s budgeting system related to control as there does not seem to be any planning and operating variance analysis performed to assess exactly where performance is lacking and so no appropriate management information is provided. In fact it is not even clear just how often divisional managers receive reports on performance throughout the year. Any budgeting system without regular feedback would be ineffective. It should even be noted that for the industry in which Perkin operates the use of only budgetary targets as a measure of performance is narrow and internal. It should be utilising information from external sources as well to assess performance in a more relevant and contextual way.

Given the rapidly changing external environment and the emphasis on innovation and continuous product development, the current traditional budgeting method does not seem appropriate for Perkin.

(b) Beyond budgeting moves away from traditional budgeting processes and is suitable for businesses operating in a rapidly changing external environment and has the following features:

1. Encourages management to focus on the present and the future. Performance is assessed by reference to external benchmarks, utilising rolling forecasts and more non-financial information. This encourages a longer term view.

2. More freedom is given to managers to make decisions, which are consistent with the organisation’s goals and achieving competitive success.

3. Resources are made available on demand, for example, to enable a division to take advantage of an opportunity in the market, rather than being constrained by budgets.

4. Management focus is switched to the customer and managers are motivated towards actions which benefit the whole organisation, not just their own divisions.

5. Effective information systems are required to provide fast and easily accessible information across the whole organisation to allow for robust planning and control at all levels.

Taking each of the elements of beyond budgeting in turn, the impact of introducing this technique into Perkin can be assessed.

At Perkin, there are rapid technological changes in the products being produced by customers and competitors as a result of changes demanded by the market, which mean that Perkin must respond and continuously innovate and develop its products. This will support Perkin’s corporate objective. Consequently, this means that Perkin must change its plans frequently to be able to compete effectively with other component manufacturers and therefore will need to move away from annual incremental budgeting to introducing regular rolling forecasts. This process will need supporting by KPIs which will have a longer term focus. The impact of this will be that Perkin will need to develop a coherent set of strategies which supports its corporate objective, which will then need to be translated into targets and appropriate KPIs selected and developed. It will also mean that performance measures at the operational level will need to be revised from annual budgetary targets to these longer term objectives. Management at all levels will require training on the production of rolling forecasts and Perkin will need to assess if additional resources will also be required to run this new system.

Beyond budgeting focuses on the long-term success of the business by division managers working towards targets which may be non-financial. The use of external benchmarks and non-financial information will mean Perkin will need to put processes in place to collect this information and analyse it to assess performance. This will be a learning process as Perkin does not currently do this. The status of preferred supplier with key customers, for example, would be important to the long-term success of the business and this could be an objective which Perkin sets for its divisional managers.

Beyond budgeting allows authority to be delegated to suitably trained and supported managers to take decisions in the long-term interests of the business. It allows managers to respond quickly and effectively to changes in the external environment, and encourages them to develop innovative solutions to external change. In Perkin, budgets proposed by divisional managers are changed by the board to reflect its overall plans for the business. This means that a change in the approach to communication between the board and the divisions will be necessary as Perkin would need to switch from the top down process currently adopted to a more devolved decision-making structure. This will again require training for management to enable them to be ready to deal with this delegated authority as it will be very different from their existing approach.

Traditional budgeting may constrain managers who are not allowed to fail to meet the approved budget. This can be seen when P Division did not adapt its components because it did not want to incur the costs of doing so, which had not been budgeted for. Similarly, prices of raw materials are known to be volatile. Beyond budgeting makes resources available for managers to take advantage of opportunities in the market, such as the smartphone designed for playing games. Managers would also be able to react to changes in the price of materials or changes in foreign currency exchange rates, for example, by having the authority to purchase silver for inventory at times when the price of silver is low. This will mean that as a result there will be fewer budgetary constraints; however, these resources and targets will still need to be effectively managed. This management will mean that strategic initiatives invested in will need monitoring rather than closely scrutinising departmental budgets, which will be a significant change in Perkin.

In Perkin, the two divisions share some manufacturing facilities and are likely to compete for other resources, for example, when setting budgets. When manufacturing facilities are in short supply, each division will prioritise its own requirements rather than those of the business as a whole. Beyond budgeting encourages managers to work together for the good of the business and to share knowledge and resources. This is important in a business such as Perkin where product innovation is key and where the activities and products of the two divisions are similar. This coordinated approach will be new to Perkin so there will be a culture change. Also, the customer-oriented element of beyond budgeting is key here and will require the setup of customer focused teams which will require more harmonised actions in the divisions.

Each division currently has its own IT systems. In order to effectively share knowledge and to be able to respond to the external environment, which are key elements of beyond budgeting, it would be preferable for them to have shared IT facilities. This will mean that Perkin may have to invest in new technology capable of sharing information across the organisation in a rapid and open fashion but also be able to collect all relevant comparative data to allow for continuous monitoring of performance. This will facilitate better planning and control across all levels of Perkin.

With appropriate training of managers and investment in information systems, it would be relevant for Perkin to adopt beyond budgeting because of the rapid changes in the external environment in which it operates.