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- February 26, 2017 at 8:58 am #374279
Hello sir.
Ive noticed that in F5 all the chapter and idea of Performance Management is concered about profit. So it is P/L account and except little bits in the chapters we dont even concern about Balance sheet. Budgeting for example, we are we budgeting on sales, Cost of sales (opening closing purchases), operating expenses, and etc. Why dont we do budgeting for Assets and Balance sheet?… Little bit of light to this question would be helpful.
P.S. I know that P/L statement shows the Perforance throughout the year so its logical here. But i mean why there is no Management techniques in Balance sheet according to the syllabus. Im sure that there are some techniques, e.g for Gearing, allocation of loan or share capital from investors( balance sheet item), or Inventories… I lack some deeper understanding why dont we study Balance sheet items now…
February 26, 2017 at 2:34 pm #374335Performance management in F5 is not simply about the Statement of profit and loss at all!!!
Although certainly measures of profitability are important, we also have measures of liquidity (which are looking at figures from the SOFP) and of course gearing.
Also, much more important than financial performance in the exam are measures of non-financial performance (and transfer pricing).
I do suggest that you watch my free lectures on this. The lectures are a complete free course for Paper F5 and cover everything needed to be able to pass the exam well.
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