TRADITIONAL NON BUDGETORY CONTROL TECHNIQUES

TRADITIONAL NON BUDGETORY CONTROL TECHNIQUES
Reviewed by Hammad Naziron Apr 01 2013
Rating: 5

There are also many traditional non-budgetary control techniques used for budgetary

control. The more important are

1. STATISTICAL DATA

Statistical analysis of an operation and the clear presentation of statistical data

(historical forecast nature) are important to control. Most managers understand

statistical data best when the data are presented in chart or graphic form. In chart or

graphic trends and relationship are easier to see. Moreover, if data are meaningful,

when presented on chart then data should be formulated in such a way that

comparison with some standard can be made. What is the significance of a 3 or 10

percent rise or fall in sales or costs? Who is responsible clear presentation of

statistical data in chart in an art that requires imagination?

Moreover, since no manager can do anything about history so the data, presented an

charts should be made available about information like variations due to accounting adjustment and other periodic difference.

SPECIAL REPORTS AND ANALYSIS

Special reports and analyses help in problems for control purposes.Althouh

accounting and statistical reports gives necessary information’s but there are some

problems in which they are inadequate. One successful manager of a completed

operation hired a small staff of trained analysts and gives them no assignment other

then investigating and analyzing activities under his control. This group developed of

a surprising sense for situations in which things did not seem just right. Almost

invariable, their investigation disclosed opportunities for cost improvement.

OPERATIONAL AUDIT

Another effective tool of managerial control is the internal audit or operational audit.

Operational auditing is the regular and independent appraisal of the accounting,

financial and other operations of an enterprise by a staff of internal auditors. The

operational auditors reflect the fact, appraise polices procedure, use of authority,

quality of management, effectiveness of methods, special problems and other phases

of operations.

PERSONAL OBSERVATION

One should never over-look the importance of control through personal

observation.Budgets, charts, reports, ratios, auditors, recommendations and other

devices are essential to control. But the manager who depends wholly on these

devices and sit cannot make effective control. Managers should have task of seeing

the enterprise objectives are accomplished by people. A manager can get information

and experience from personal observation.