Non-financial performance

Which is not a non-financial performance indicator?

• Customer satisfaction

• Market share

• Quality

• Working capital

What is the formula for market share?

• Operating profit/Capital employed x100

• Sales revenue - Cost of sales

• Sales of a business/Total sales in a market x100

• Fixed cost/Contribution per unit

What is window dressing?

• Techniques for improving a business’ balance sheet position, in particular its apparent liquidity

• A snapshot of the financial position of a company at a particular moment in time

• Description of what a business sets out to achieve in the long term

• The amount of money your business needs to meet its everyday financial obligations

How can a business window dress its account?

• Sales and lease back

• Hiding poor investments

• Brand valuation

What is the drawback of assessing performance based on productivity?

• Lower unit costs

• Greater revenue

• Reduced quality

• Better customer service

If a business conforms to British standards, what award can the business receive?

• Investors in People (IIP)

• Customers Service Excellence

• Kitemark (ISO 9001)

Why would a firm NOT want to make itself look as successful as it has been?

• To reduce the risk of a hostile takeover

• To raise finance from a bank

• To please the shareholders of public limited companies

• To show growth in terms of sales

Select the statement you believe to be true from the choices below

• Increasing market share will result in a business attracting more customers

• To increase sales revenue, a business may need to spend less on advertising which could result in profits

• Increased productivity may result in higher unit costs

• Improving quality can lead to less profit

What is the benefit of assessing performance based on sales targets?

• Targets can be unrealistic

• Unforeseen circumstances can affect sales

• Businesses can act unethicallly to meet the target

• It provides a clear path for the business

Which one is the best way for an airline company to measure non-financial performance?

• Revenue

• Acid test ratio

• ROCE

• Measuring the proportion of flights that take off and land on time