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Public sector entities have performance measures laid down by government, based on Key Performance Indicators (KPIs). Which Four of the following are likely to be financial Kpis for a local council.
Rent receipts outstanding
Interest cover
Dividend cover
Financial actuals against budget
Return on capital employed
The answer seems to suggest that return on capital employed and dividend cover are not the answer but the question asks for four so which is the fourth one out of these two.
Also why are rent receipts outstanding a financial key performance indicatorHi,
Public sector entities will be renting out properties to tenants and so will still be collecting rent. Think about local councils/government who will be supporting people on low incomes by providing affordable housing.
A public sector will not be paying dividends as there are no shareholders and so this would not be relevant to them, plus a public sector entity would not be looking at the amount of profit it can generate as it is government owned. It will be assessed on how effectively it is using the funds given within its government department.
Thanks
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