Bsc and Tableau de Bord Essay Example

systems. The underlying principle of responsibility accounting is economic accountability.

The previous economic responsibility system does not have a clear connection with accounting. However, responsibility accounting combines economic responsibility with accounting practices and theories, making it a part of the accounting field (MBAlib, 2011). ACCA (2001) defines responsibility accounting as an accounting system that separates revenues and costs into areas of personal responsibility to monitor and evaluate the performance of each part of an organization.

According to Drury (2008), responsibility accounting entails the establishment of responsibility centres, which refer to specific parts of an organization led by managers who have direct accountability for their performance (ACCA, 2001). Additionally, Drury (2000) emphasized that the aim of responsibility accounting is to track costs and revenues for each individual responsibility centre. Consequently, any deviations from performance targets, particularly the budget, can be attributed to the person in charge of the responsibility centre (Drury, 2004).

In Elliott's (2008) classification, responsibility centres are divided into four categories: 'cost centres', 'revenue centres', 'profit centres', and 'investment centres'. These centres play a vital role in ensuring the effective functioning of different units under their jurisdiction, with the aim of achieving each centre's objectives (Edwards et al, 1994). Furthermore, Jones (2006) argues that responsibility accounting holds managers accountable for controllable expenses but not uncontrollable costs.

The inclusion of social responsibility accounting within management accounting is crucial for achieving long-term strategic goals. The integration of the Balanced Scorecard (BSC) helps overcome the challenge of aligning short-term objectives with long-term strategy in traditional management systems. Acting as a tool for strategy implementation, the BSC enhances the connection and effectiveness between social

responsibility accounting and an organization's strategic goals, allowing it to assume a more suitable position (Drury, 2008; Jones, 2006; ACCA, 2001).

Drury (2008) states that the Balanced Scorecard (BSC) aims to monitor and adjust business strategy through comprehensive performance measurement. This approach offers a holistic understanding of financial outcomes resulting from non-financial measures that contribute to long-term financial success. The BSC typically includes four perspectives for organizations: Financial, Customer, Internal business, and Learning and growth.

The use of financial performance indicators allows organizations to evaluate the effectiveness of their strategy and its impact on profitability (Drury, 2008). While the financial perspective focuses on measures such as operating income, return on capital employed (ROCE), and economic value added (EVA) for assessing profitability, it is important to acknowledge that not all long-term strategies will immediately yield short-term financial benefits. Therefore, it becomes crucial to enhance non-financial performance indicators like quality, production time, productivity, and new product introductions in order to accomplish organizational objectives (ACCA, 2001).

According to Drury (2008), the customer perspective can be defined as the customer and market segments in which the business unit will compete. It includes the operational measures of the business unit for these target customers and markets (Jones, 2006). Drury (2004) emphasized that the customer perspective is crucial for achieving financial perspective objectives related to revenue. Additionally, customer perspective typically involves aspects such as market share, customer profitability, return policy, and handling of claims and complaints (ACCA, 2001).

The balanced scorecard approach necessitates businesses to delineate specific goals and indicators related to customer satisfaction in accordance with their overall vision and strategy (Locke ; Lowe, 2009). To

effectively address the needs of customers, it is crucial for enterprises to consider whether they are meeting customer demands in terms of time, quality, performance, service, and cost. By establishing and attaining clear objectives guided by their vision and strategy, enterprises can effectively cater to their customers.