ACCA · Question 19 · Budgeting and control
Section B - Case 1: GreenHarvest
GreenHarvest operates a large-scale organic farm producing two main crops: Quinoa and Kale. The farm is transitioning from traditional absorption costing to Activity-Based Costing (ABC).
The Farm Manager is frustrated with the annual budgeting process, claiming it is too rigid for the unpredictable agricultural sector. She suggests adopting a 'Beyond Budgeting' approach.
Which TWO of the following are principles of Beyond Budgeting?
Answer options:
Setting fixed, unchangeable annual financial targets.
Setting relative performance targets (e.g., beating the market average).
Centralizing all financial decision-making at the board level.
Decentralizing decision-making to front-line managers who are closer to the action.
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