• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for March and June 2025 exams.
Get your discount code >>

VALUE BASED MANAGEMENT

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA APM Exams › VALUE BASED MANAGEMENT

  • This topic has 4 replies, 3 voices, and was last updated 10 years ago by afridi9rizwan.
Viewing 5 posts - 1 through 5 (of 5 total)
  • Author
    Posts
  • May 11, 2015 at 2:38 pm #245266
    afridi9rizwan
    Participant
    • Topics: 11
    • Replies: 15
    • ☆

    Sir can you please brief me on VBM and which questions i should attempt regarding this topic. Thanks

    May 11, 2015 at 5:29 pm #245303
    samiirah
    Member
    • Topics: 22
    • Replies: 20
    • ☆

    i think vbm is the main aim of an org is value creation.ie creating value for sharholders..all people at all level (strategic,tactical n operational) in an org should work towards same aim ie creating value.each one should identify the key drivers for value creation.At strategic level will use measure such as eva.n operational level measures such as profit margin. Pls correct me if am wrng

    May 11, 2015 at 5:48 pm #245304
    afridi9rizwan
    Participant
    • Topics: 11
    • Replies: 15
    • ☆

    ill let Mr gromit correct you:). I think its the same concept as lynch and cross where all the levels work together to meet the corporate vision or mission and mixed with performance prism which focuses on shareholders. We could also then mention about the quality,idle time,flexibility and productivity as they all create value so im wondering if we will get credit in the exam if we mention these particular points. Activity based management can also be mentioned here as it will identify those areas with high costs and then rectifying it will help set competitive prices and too will add value.

    May 11, 2015 at 7:59 pm #245325
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10589
    • ☆☆☆☆☆

    VBM is managing companies consistently to maximizing shareholder value.

    This means that the decisions made today are not simply driven by short-term profit considerations. Instead, the longer-term effects that the decisions will have on organizational sustainability and profitability, reflected in future cash flows.

    A fundamental principle of VBM is the belief that future cash flow and growth are the source of a company’s value. Looking at accounting-based measures (such as quarterly earnings, earnings per share, and the price/earnings ratio) is not how decisions should be made under VBM. Making decisions based on long-term, future cash flows can be difficult, particularly if there is significant pressure from short-term investors.

    See December 2010 Q3

    May 11, 2015 at 8:03 pm #245327
    afridi9rizwan
    Participant
    • Topics: 11
    • Replies: 15
    • ☆

    thank you for the reply, shall practice it more.

  • Author
    Posts
Viewing 5 posts - 1 through 5 (of 5 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • bpop on Risk and uncertainty (part 2) – ACCA (AFM) lectures
  • kamo7293 on Financial performance – Example 2 – ACCA Financial Reporting (FR)
  • nevertoolate on CIMA BA2 – Regression analysis
  • Ken Garrett on The nature and structure of organisations – ACCA Paper BT
  • Ark1 on The nature and structure of organisations – ACCA Paper BT

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in