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Accountant in
Business
Time allowed: 2 hours
ALL FIFTY questions are compulsory and MUST be attempted.
Do NOT open this paper until instructed by the supervisor.
This question paper must not be removed from the examination hall.
Fundamentals Pilot Paper Knowledge module
P
ap
er
F1
The Association of Chartered Certified Accountants
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ALL FIFTY questions are compulsory and MUST be attempted
Please use the Candidate Registration Sheet provided to indicate your chosen answer to each multiple choice question.
1 An organisation which restructures through a major de-layering exercise has as a result moved to a shorter scalar
chain and a narrower span of control.
Is the above statement true or false?
A True
B False
(1 mark)
2 Which of the following is the main function of marketing?
A To maximise sales volume
B To identify and anticipate customer needs
C To persuade potential consumers to convert latent demand into expenditure
D To identify suitable outlets for goods and services supplied
(2 marks)
3 Which one of the following has become an established best practice in corporate governance in recent years?
A An increasingly prominent role for non-executive directors
B An increase in the powers of external auditors
C Greater accountability for directors who are in breach of their fiduciary duties
D A requirement for all companies to establish an internal audit function
(2 marks)
4 In a higher education teaching organisation an academic faculty is organised into courses and departments, where
teaching staff report both to course programme managers and to subject specialists, depending on which course
they teach and upon their particular subject specialism.
According to Charles Handys four cultural stereotypes, which of the following describes the above type of
organisational structure?
A Role
B Task
C Power
D Person(2 marks)
5 At what stage of the planning process should a company carry out a situation analysis?
A When converting strategic objectives into tactical plans
B When formulating a mission statement
C When validating the effectiveness of plans against outcomes
D When formulating strategic objectives
(2 marks)
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6 Which one of the following is potential advantage of decentralisation?
A Greater control by senior management
B Risk reduction in relation to operational decision-making
C More accountability at lower levels
D Consistency of decision-making across the organisation
(2 marks)
7 Which one of the following is an example of a internal stakeholder?
A A shareholder
B An non-executive director
C A manager
D A supplier
(2 marks)
8 According to Mendelow, companies must pay most attention to the needs of which group of stakeholders?
A Those with little power and little interest in the company
B Those with a high level of power but little interest in the company
C Those with little power but a high level of interest in the company
D Those with a high level of power and a high level of interest in the company
(2 marks)
9 What is the responsibility of a Public Oversight Board?
A The establishment of detailed rules on internal audit procedures
B The commissioning of financial reporting standards
C The creation of legislation relating to accounting standards
D The monitoring and enforcement of legal and compliance standards
(2 marks)
10 The ageing population trend in many European countries is caused by a increasing birth rate and an increasing
mortality rate.
Is this statement true or false?
A True
B False
(1 mark)
11 Which one of the following is consistent with a governments policy objective to expand the level of economic
activity?
A An increase in taxation
B An increase in interest rates
C An increase in personal savings
D An increase in public expenditure(2 marks)
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12 Martin is an experienced and fully trained shipbuilder, based in a western European city. Due to significant
economic change in supply and demand conditions for shipbuilding in Martins own country, the shipyard he
worked for has closed and he was made redundant. There was no other local demand for his skills within his own
region and he would have to move to another country to obtain a similar employment, and could only find similar
work locally through undertaking at least a years retraining in a related engineering field.
Which of the following describes the type of unemployment that Martin has been affected by?
A Structural unemployment
B Cyclical unemployment
C Frictional unemployment
D Marginal unemployment
(2 marks)
13 When an organisation carries out an environmental scan, it analyses which of the following?
A Strengths, weaknesses, opportunities and threats
B Political, economic, social and technological factors
C Strategic options and choice
D Inbound and outbound logistics
(2 marks)
14 Which of the following is data protection legislation primarily designed to protect?
A All private individuals and corporate entities on whom only regulated data is held
B All private individuals on whom only regulated data is held
C All private individuals on whom any data is held
D All private individuals and corporate entities on whom any data is held
(2 marks)
15 Which of the following types of new legislation would provide greater employment opportunities in large
companies?
A New laws on health and safety
B New laws to prevent discrimination in the workplace
C New laws making it more difficult to dismiss employees unfairly
D New laws on higher compensation for employer breaches of employment contracts
(2 marks)
16 The total level of demand in the economy is made up of consumption, ____________, government expenditure and
net gains from international trade.
Which of the following correctly completes the sentence above.
A Savings
B Taxation
C Investment
(1 mark)
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17 Which set of environmental factors does a lobby group intend to directly influence?
A Political
B Technological
C Demographic
D Economic
(2 marks)
18 Adrian is the manager of a call centre. Consultants have advised him that by reorganising his teams to complete
highly specific tasks the call centre will be able to increase the throughput of work significantly, as well as
increasing the number of sales calls made to the public. The reorganisation proposals are unpopular with many
workers, who feel that their jobs will become tedious and repetitive.
The proposal to reorganise the work of the call centre utilises principles put forward by which school of
management thought?
A The human relations school
B The empirical school
C The scientific school
D The administrative school
(2 marks)
19 The original role of the accounting function was which one of the following?
A Providing management information
B Recording financial information
C Maintaining financial control
D Managing funds efficiently
(2 marks)
20 Tax avoidance is a legal activity whilst tax evasion is an illegal activity.
Is this statement true or false?
A True
B False
(1 mark)
21 The system used by a company to record sales and purchases is an example of which of the following?
A A transaction processing system.
B A management information system
C An office automation system
D A decision support system
(2 marks)
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22 The implementation of a budgetary control system in a large organisation would be the responsibility of the internal
auditor.
Is this statement true or false?
A True
B False
(1 mark)
23 Which type of organisation would have the retail prices it charges to personal consumers subject to close
scrutiny by a regulator?
A A multinational corporation
B A multi-divisional conglomerate
C A national utilities company
D A financial services provider
(2 marks)
24 The central bank has announced a 2% increase in interest rates.
This decision has the most impact on which department in a large company?
A Auditing
B Treasury
C Financial accounting
D Production
(2 marks)
25 The major purpose of the International Accounting Standards Board (IASB) is to ensure consistency in ___________.
Which two words complete this sentence?
A Financial control
B Corporate reporting
C External auditing
(1 mark)
26 Farrah, Gordon, Helene and Ian work in the finance department of X Co, which has separate financial accounting
and management accounting functions. Farrah deals with payroll, the purchase ledger and sales invoicing. Gordonsduties involve inventory valuation, budgetary control and variance analysis. Helene deals with fraud prevention
and detection, and internal control. Ian carries out risk assessments, investment appraisals and assists in project
planning.
Which member of the department works in the financial accounts function?
A Farrah
B Gordon
C Helene
D Ian
(2 marks)
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27 In an economic environment of high price inflation, those who owe money will gain and those who are owed money
will lose.
Is this statement true or false?
A True
B False
(1 mark)
28 To whom is the internal auditor primarily accountable?
A The directors of the company
B The company as a separate entity
C The shareholders of the company
D The employees of the company
(2 marks)
29 Which one of the following is a DISADVANTAGE of a computerised accounting system over a manual accountingsystem?
A A computerised system is more time consuming to operate
B The operating costs of a computerised system are higher
C The computerised system is more costly to implement
D A computerised system is more error prone
(2 marks)
30 Calum works in the internal audit department of Z Co. His duties involve the identification, evaluation and testing
of internal controls. He produces reports to senior management on these activities.
For which type of audit is Calum responsible?
A Operational audit
B Transactions audit
C Social responsibility audit
D Systems audit
(2 marks)
31 What is the primary responsibility of the external auditor?
A To verify all the financial transactions and supporting documentation of the client
B To ensure that the clients financial statements are reasonably accurate and free from bias
C To report all financial irregularities to the shareholders of the client
D To ensure that all the clients financial statements are prepared and submitted to the relevant authorities on time
(2 marks)
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32 Which of the following are substantive tests used for in the context of external audit of financial accounts?
A To establish whether a figure is correct
B To investigate why a figure is incorrect
C To investigate whether a figure should be included
D To establish why a figure is excluded
(2 marks)
33 In the context of fraud, teeming and lading is most likely to occur in which area of operation?
A Sales
B Quality control
C Advertising and promotion
D Despatch
(2 marks)
34 In order to establish an effective internal control system that will minimise the prospect of fraud, which one of
the following should be considered first?
A Recruitment policy and checks on new personnel.
B Identification of areas of potential risk.
C Devising of appropriate sanctions for inappropriate behaviour.
D Segregation of duties in critical areas
(2 marks)
35 The leadership style that least acknowledges the contribution that subordinates have to make is ___________.
Which word correctly completes this sentence?
A Authoritarian
B Autocratic
C Assertive
(1 mark)
36 Renata has attended a leadership development course in which she experienced a self-analysis exercise using
the Blake and Mouton managerial grid. The course leader informed her that the results suggested that Renata
demonstrated a 9.1 leadership style, which suggested that she is highly focused on achieving the objectives of
the team.
What other conclusion may be drawn in relation to Renatas leadership style?
A She maximises the involvement of her team
B She demonstrates little concern for people in the team
C She balances the needs of the team with the need to complete the task.
D She favours psychologically close managersubordinate relationships
(2 marks)
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37 Jackie leads an established team of six workers. In the last month, two have left to pursue alternative jobs and one
has commenced maternity leave. Three new staff members have joined Jackies team.
Which one of Tuckmans group stages will now occur?
A Norming
B Forming
C Performing
D Storming
(2 marks)
38 Richard is a highly enthusiasticmember of his team. An extrovert by nature, he is curious and communicative. He
responds to new challenges positively and has a capacity for contacting people exploring anything new. However,
his attention span is short and he tends to become less involved in a task once his initial interest has passed.
According to Belbins team roles theory, Richard displays the characteristics of which of the following?
A Monitor-evaluator
B Plant
C Resource-investigator
D Company worker
(2 marks)
39 Which one of the following statements is correct in relation to monetary rewards in accordance with Herzbergs
Two-Factor theory?
A Pay increases are a powerful long-term motivator
B Inadequate monetary rewards are a powerful dissatisfier
C Monetary rewards are more important than non-monetary rewards
D Pay can never be used as a motivator
(2 marks)
40 Which one of the following is a characteristic of a team as opposed to a group?
A Members agree with other members
B Members all have equal status
C Members arrive at decisions by consensus
D Members work in cooperation(2 marks)
41 According to Victor Vroom:
Force (or motivation) = _________ x expectancy
Which of the following words completes Vrooms equation.
A Needs
B Valence
C Opportunity(1 mark)
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42 According to Handys shamrock organisation model, which one of the following is becoming progressively less
important in contemporary organisations?
A The permanent, full-time work force
B The part-time temporary work force
C The role of independent sub-contractors
D The role of technical support functions
(2 marks)
43 Which pattern of communication is the quickest way to send a message?
A The circle
B The chain
C The Y
D The wheel
(2 marks)
44 Poor quality lateral communication will result in which of the following?
A Lack of direction
B Lack of coordination
C Lack of delegation
D Lack of control
(2 marks)
45 Role playing exercises using video recording and playback would be most effective for which type of training?
A Development of selling skills
B Regulation and compliance
C Dissemination of technical knowledge
D Introduction of new processes or procedures
(2 marks)
46 In the context of marketing, the four Ps are price, place, promotion and __________.
Which word correctly completes this sentence?A Processes
B Production
C Product
(1 mark)
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47 In relation to employee selection, which type of testing is most appropriate for assessing the depth of knowledge
of a candidate and the candidates ability to apply that knowledge?
A Intelligence testing
B Personality testing
C Competence testing
D Psychometric testing
(2 marks)
48 A company has advertised for staff who must be at least 1.88 metres tall and have been in continuous full-time
employment for at least five years.
Which of the following is the legal term for this unlawful practice?
A Direct discrimination
B Indirect discrimination
C Victimisation
D Implied discrimination.(2 marks)
49 Gloria has the responsibility to work with selected management trainees in her organisation. Her objective is to help
the trainees over the medium to long-term with their personal career development. Supporting and encouraging
them to fulfil their potential is an integral part of her role. Gloria has no involvement in the technical content of the
trainee managers work.
Which of the following roles does Gloria fulfil?
A Buddy
B Counsellor
C Mentor
D Instructor
(2 marks)
50 Gils is conducting an appraisal interview with his assistant Jill. He initially invites Jill to talk about the job, her
aspirations, expectations and problems. He adopts a non-judgmental approach and offers suggestions and guidance.
This is an example of which approach to performance appraisal?
A Tell and sell approach
B Tell and listen approach
C Problem solving approach
D 360 degree approach
(2 marks)
End of Question Paper
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Answers
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Pilot Paper F1 Answers
Accountant in Business
1 B 26 A
2 B 27 A
3 A 28 A
4 B 29 C
5 D 30 D
6 C 31 B
7 C 32 A
8 D 33 A
9 D 34 B
10 B 35 B
11 D 36 B
12 C 37 B
13 B 38 C
14 B 39 B
15 B 40 C
16 C 41 B
17 A 42 A
18 C 43 D
19 B 44 B20 A 45 A
21 A 46 C
22 B 47 C
23 C 48 B
24 B 49 C
25 B 50 B
Rationale for answers
1 B The span of control is concerned with the number of subordinates reporting directly to one person. The scalar chain conceptrelates to the number of levels in the management structure. Therefore delayering causes a reduction in levels of management,with each manager having more subordinates.
2 B The basic principle that underlies marketing is that it is a management process that identifies and anticipates customer needs.The other distractors in the question refer to specific activities undertaken by a marketing function.
3 A Successive reports on corporate governance (Cadbury, Higgs, etc.) have highlighted the increasingly prominent role that non-executive directors should take in large organisations. This has become an established best practice.
4 B The task culture is appropriate where organisations can accommodate the flexibility required to adjust management and team
structures to address the tasks that must be fulfilled. This is very common in large consultancy firms.
5 D A situation analysis is carried out when deciding on strategic objectives. The organisation will have already decided on itsmission statement and goals.
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6 C Greater accountability at lower levels will lead to greater empowerment of those taking decisions and hence greater motivation
and commitment, but will lead to less control and potentially more inconsistency.
7 C A manager is employed by the organisation and is therefore a constituent part of it. All the others are known as connected
stakeholders.
8 D The organisation must constantly be aware of the needs of stakeholders with a high level of power and the ability to influence the
organisation profoundly. Management decisions must therefore take most account of the needs of this group of stakeholders.
9 D The primary aim of a public oversight board is to eliminate or minimise any actual or potential breaches of legislative requirementsand to ensure compliance with regulations applicable to organisations within their terms of reference.
10 B The ageing population trend is caused by decreasing birth rate and a decreasing mortality rate.
11 D An increase in public expenditure should increase the level of consumer demand and hence the level of economic activity. Thiswould also be achieved by other measures, such as a reduction in taxation or a reduction in interest rates.
12 C Frictional unemployment arises even when there are unfilled vacancies in the economy. It is because there is never a perfectmatch between the types of job available and their location with the skills of those seeking work and where they live.
13 B Any environmental scan analyses the external factors that affect an organisation, often categorised as political, economic, socialand technological factors.
14 B Data protection legislation is formulated to protect the interests of data subjects who are private individuals. Not all data isregulated.
15 B Diversity policies are intended to reduce recruitment and selection policies and processes that enable discrimination to arise onthe basis of gender, race, lifestyle and age, therefore such policies widen access of employment.
16 C The components of effective demand in the economy are consumer spending, investment by enterprises, central and localgovernment expenditure and the net gains from international trade.
17 A Lobby groups are primarily established to influence political decision takers, such as the government and individuallawmakers.
18 C Scientific management principles consider the ways in which the factors of production (land, labour, capital and the
entrepreneurial function) can be combined to maximise efficiency in production. The founding principles are based on thework of Frederick Winslow Taylor. The reorganisation of the call centre follows these principles.
19 B The accounting function originated from the need to record transactions completely and accurately. Other requirements naturally
evolved from this at a later stage.
20 A Tax avoidance enables the individual or entity to apply legitimate rules to reduce the amount of tax payable. Tax evasion is
always based on a deliberate intent not to pay tax that is lawfully due.
21 A A transaction processing system enables all sales and purchase transactions to be recorded by volume and category.
22 B The implementation of a budgetary control system would be the responsibility of the financial controller in many organisations.
The internal auditor is not responsible for implementing systems, but is involved in monitoring the effectiveness of thesesystems.
23 C Public ultilities companies often have national or local monopolies and it is therefore necessary for their pricing structures tobe subject to the scrutiny of a regulatory body.
24 B An interest rate is the price of money. The output of the treasury function is directly affected by the price of funds to theorganisation and the returns that can be made from surplus funds.
25 B The IASB aims to promote consistency in corporate reporting by creating financial reporting standards to which major businessesare expected to adhere.
26 A Payroll, purchase ledger and sales invoicing are core functions within the responsibility of the financial accountant.
27 A Where price inflation is high the value of money reduces consistently over time. Those who owe money (debtors) therefore pay
back less capital in real terms, and interest rates seldom adjust adequately to compensate for this.
28 A The internal auditor must have the right to report and is most accountable to the highest level of management (Directors) in
the organisation. They must be free of influence from any individual manager, irrespective of seniority.
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29 C A computerised system can be costly to set up, though this disadvantage is essentially a short-term issue, as the running costs
should offset this over time. A computer system should also reduce transaction processing time and the incidence of errors.
30 D Systems audit is concerned with the effectiveness of the system itself and not the processes, activities or values of the
organisation.
31 B The external auditor has to ensure that the financial statements of the organisation truly reflect the activities of the business in
the relevant accounting period. This assessment should be independent and therefore free from subjectivity on the part of themanagement of the client organisation.
32 A Substantive tests verify the accuracy of the financial information.
33 A Teeming and lading involves the theft of cash and is a type of fraud that is carried out by manipulating transactions. There
would be most potential for this fraud within the sales department where cash may be received and remitted.
34 B All control systems should be based on an assessment of areas of risk prior to the consideration of other factors.
35 B The Ashridge model identifies four styles: autocratic; authoritarian; consultative; laissez-faire (or participative). The first of theseis the least participative.
36 B The Blake and Mouton managerial grid enables leadership styles to be categorised on a nine point scale with reference toconcern for people and concern for production.
37 B With the recent departures and the new staff joining the group, it will revert to the forming stage.
38 C The words curious and explore confirm that the individual is a resource-investigator.
39 B According to Herzberg, money is a hygiene factor (or dissatisfier). Although it is a powerful short-term motivator, it is questionable
whether each individual increase in monetary reward will have a major long-term effect. According to Herzberg, A reward oncegiven becomes a right.
40 C Consensus implies coming to decisions that are acceptable, paying due regard to the input of all members of the team.
41 B Victor Vroom defines valence as the individuals preference for a given outcome.
42 A Handys theory suggests that full-time, permanent workers are both expensive and inflexible in comparison with other elements
of the shamrock. These other elements are part-time workers and independent contractors. A fourth leaf can be getting thecustomer to do the work.
43 D The wheel facilitates transmission of the message directly to all receivers and therefore transmits most quickly.
44 B Lateral communication is horizontal. Therefore, poor quality communication will result in poor coordination between teammembers.
45 A Role playing exercises are most effectively used for skills development, including sales training. Other common business
applications include effective selection interviewing and performance appraisal interviewing.
46 C Product is the fourth component of the marketing mix. This term can also relate to a service as well as tangible products.
47 C Competence testing evaluates and validates knowledge and the ability to apply these to given situations. It assesses whether
the individual can actually do specified tasks.
48 B A height restriction is a form of indirect discrimination on the grounds of gender. On average, men are taller than women.
49 C A mentor has a longer-term role than buddies, counsellors or instructors.
50 B The tell and listen approach encourages input from the individual, promoting participation the process by the appraisee.
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Managing People
PART 1
MONDAY 9 DECEMBER 2002
QUESTION PAPER
Time allowed 3 hours
This paper is divided into two sections
Section A This question is compulsory and MUST be
answered
Section B FOUR questions ONLY to be answered
Pap
er
1.
3
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Section A This ONE question is compulsory and MUST be attempted
1 The supermarket chain Food is Us has decided to tackle prejudice and discrimination in all its stores by establishing
a policy applicable to all its stores. As part of this, it is challenging all employees, especially managers, to examine
their attitudes towards people of a different race, sex and ability.
The reasons for introducing the policy are threefold. Plainly there is legislation on discrimination which must be
complied with if the company is to avoid the risk of legal action against it. Also, from a marketing point of view, Foodis Us wish to be identified with its customer base by reflecting the racial diversity of the environments in which it
operates. Most positively, the company wants to develop a workforce which can reflect sufficient diversity not only to
avoid risk and to maintain its current market position, but also produce the initiatives which will develop the company
in a successful and sustained manner.
During the course of the coming year, all store employees will be expected to attend an awareness-raising training
programme. This programme is intended to help employees explore their own attitudes and highlight any prejudices
that these employees might have.
The personnel director, Anne Healey, told shop operatives we want to make all our front line employees who deal
closely with the members of the public aware of any subconscious prejudices that they might have.
It is very difficult to quantify the benefits of such specialist training, but it is one of our corporate principles that allpeople are treated fairly by employees, whether they are customers or work colleagues, she added.
Initially small groups of employees will attend sessions to raise awareness. These sessions, to be held in-store, will
take place during time already set aside for staff training and development.
The new policy is to be an extension of Food is Us current equal opportunities scheme for managers. So far more
than 1500 managers have attended one day awareness-raising courses over the past 18 months.
The same course is to be revised and updated following feedback from previous participants and will also be extended
to include senior executives for the first time.
Required:
With reference to the above scenario:
(a) Equal opportunities encompass many features. For Food is Us
(i) What would be the main features of a sex discrimination policy? (10 marks)
(ii) What would be the main characteristics of a race relations policy? (6 marks)
(b) Why should an organisation like Food is Us have an equal pay policy? (6 marks)
(c) What are the key points of a disability discrimination policy? (8 marks)
(d) What is the difference between an equal opportunities policy and a managing diversity initiative within an
organisation? (10 marks)
(40 marks)
2
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Section B FOUR questions ONLY to be attempted
2 In seeking organisational success, some managers are adopting a Theory Z approach to managing.
Required:
(a) Describe the characteristics of an organisation which uses a Theory Z approach. (10 marks)
(b) Are the ideas of Theory Z universally applicable? (5 marks)
(15 marks)
3 An organisation is recruiting additional staff and has decided to compare the benefits of appointing existing internal
staff with that of appointing external candidates.
Required:
(a) Define and describe the advantages of internal promotion. (5 marks)
(b) Define and describe the advantages of external recruitment. (5 marks)
(c) Describe three factors that should be taken into account when deciding upon whether to use recruitment
consultants. (5 marks)
(15 marks)
4 Modern business organisations require trained employees, but individuals approach learning in different ways.
Required:
(a) Briefly describe the four stages in the experiential learning cycle. (4 marks)
(b) Describe the four learning styles identified by Honey and Mumford and their implications for training
programmes. (11 marks)
(15 marks)
5 Motivation is fundamental to the task of management.
Required:
(a) What is meant by the term process theory of motivation? (5 marks)
(b) What is meant by the equity theory of motivation? (5 marks)
(c) Briefly describe the response an individual might have to feelings of negative inequity. (5 marks)
(15 marks)
3 [P.T.O.
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6 A key part of an accountants job is communicating information to others.
Required:
(a) Explain the importance of good communication. (5 marks)
(b) List five possible barriers to good communication. (5 marks)
(c) Describe how these barriers to communication can be overcome. (5 marks)
(15 marks)
End of Question Paper
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Answers
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Part 1 Examination Paper 1.3
Managing People December 2002 Answers
1 Overview
Organisations and businesses are made up of many individuals all working together. These individuals have different attitudes,
perceptions and learning experiences, which together with gender and personality differences can be either a good source for
developing creativity within an organisation or the root of an organisations problems.
Managers need to be aware of the many factors that affect individual differences and their own attitudes and assumptions. They
should recognise individual potential and harness talent to achieve the organisational goals.
(a) Equal Opportunities is a generic term which describes the belief that there should be an equal chance for all workers in an
organisation to apply and be selected for jobs, to be trained and promoted in employment and to have that employment
terminated fairly. Employers should only discriminate according to ability, experience and potential. All employment decisions
should be based solely on a persons ability to do the job in question; no consideration should be taken of a persons sex,
age, racial origin, disability or marital status.
(i) A Sex Discrimination Policy would look at equality in all areas of employment. Such areas would include the selection
process, opportunities for training, promotion, the provision of benefits and facilities and dismissal.
This policy would deem it wrong to make any form of discrimination within employment matters because of marital
status or sex.
The policy should cover the three main categories of sex discrimination: direct discrimination, indirect discrimination and
victimisation.Direct discrimination incorporates the treating of a person on sexual or marital grounds less favourably than others would
be treated. One act of discrimination is sufficient and must be directed against an individual. Such as a clause in the
employment contract which states that it would be terminated on marriage.
Indirect discrimination consists in applying a term or condition applicable to both sexes but which one sex has
considerably smaller ability to comply with it than the other. Such as all applicants for a post must be six feet tall.
Victimisation is the discrimination against an individual who has brought proceedings or given evidence in another case.
Such persons should not be treated less favourably than any other individual in the same circumstances.
(ii) A race relations policy would adopt the same approach as the sex discrimination policy. However this policy would look
at racial grounds and racial groups. These phrases refer to colour, race, nationality or other ethnic or national origins.
The same three categories of direct and indirect discrimination and victimisation can be used.
(b) An equal pay policy means that a woman is entitled to identical pay with men and vice versa in respect of like work or work
that is rated as equivalent or equal value to that of a man in the same employment.
Like work means work of a broadly similar nature where differences are not of a practical nature. Work rated as equivalent
requires equal pay. This is when work has been evaluated and graded to be equivalent as other work in relation to effort, skill
and decision-making. Work of equal value is that of a womans to that of a mans in the same organisation.
This should apply equally to men and women.
In addition to any statutory equal pay policy and indeed social responsibility toward its workforce, Food is Us would benefit
from an equal pay policy in other ways. It would avoid the costs and poor publicity that might arise from legal action brought
to enforce the law would be important for a business of this size and profile. In addtion it would project a caring image to its
diverse customer base and in terms of good people management, attract the best employees from a wider range of sources
and with more diverse characteristics, and help build its customer base to include a wider constituency.
(c) A disability discrimination policy should contain the following key points:
a disabled person is defined as a person who has a physical or mental impairment that has a substantial and long-term,
more than 12 months, adverse effect on his/her ability to carry out normal day to day activities. Severe disfigurement is
included, as are progressive conditions such as HIV even though the current effect may not be substantial.
the effect includes mobility, manual dexterity, physical co-ordination, and lack of ability to lift or speak, hear, see,
remember, concentrate, learn or understand or to perceive the risk of physical danger.
the policy should also make it clear that it is wrong to discriminate against disabled people in the interviewing and
selection process, for promotion, transfer or training and by dismissal.
the employer has the duty to make reasonable adjustments to the physical features of the workplace where they
constitute a hazard to the disabled person.
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(d) Equal Opportunities and Managing Diversity
There is a new generation of managers within organisations who regard the quality of their people as the distinguishing feature
of a successful organisation.
People are the single sustainable source of competitive advantage. Nurturing high performance through the development of
people is essential if organisations are to remain viable and competitive.
The promotion of equal opportunities has made good business sense. Equal opportunities has been promoted as a key
component of good management as well as being legally required, socially desirable and morally right.
Managing diversity expands the horizons beyond equality issues and builds on recognised approaches to equal opportunities.
It adds new impetus to the development of equal opportunities and the creation of an environment in which enhanced
contributions from all employees will work to the advantage of business, people themselves and society more generally.
It offers an opportunity for organisations to develop a workforce to meet their business goals and to improve approaches to
customer care.
Managing diversity is about having the right person for the job regardless of sex, colour or religion. Essentially the management
of diversity is a quality assurance approach. It helps identify hidden organisational barriers which make it more difficult for
people who are perceived as being different from the majority of their colleagues to succeed and develop careers.
It also helps to effect cultural change and to create an environment in which people from all backgrounds can work together
harmoniously. The management of diversity combats prejudice, stereotyping, harassment and undignified behaviour.
2 Overview
In the search for organisational success, many business organisations have sought to adopt what appear to be successful Japanese
management methods. The leading theorist in this field is William Ouchi, who, drawing on earlier work, has described the Japanese
approach to management as Theory Z.
(a) William Ouchi, a Japanese American, has concerned himself with comparing Japanese management techniques with
American. Ouchi uses the term Theory Z for firms which use Japanese methods adapted to the Western system. Such
organisations display certain characteristics:
workers and managers trust their superiors
a much longer time horizon is the norm; the idea of short-term profit is rejected in favour of long-term growth
there is a team approach. Departments see their position within the organisation as a whole
a caring, paternal management unhampered by unions, demarcation or professional prejudices
generalised training. Managers learn the business, not just parts of it
a flexible organisation structure
collective values and company wide rewards
slow, but known promotion
lifelong employment.
(b) Theory Z requires an emphasis on interpersonal skills and group and team working; decisions are based on consensus, but,
unlike in Japan from where the idea originates, responsibility remains with the individual.
Trust and informal relationships are the keystone of Theory Z organisations, even though the formal hierarchy and
organisational traditional structure remain.
It is often compared to Macgregors Theory Y approach in that it is seen as a more caring, sensitive and effective way of
achieving organisational success.
The theory is dependent upon the demands of the organisational situation. Some organisations, as a consequence of their
product or service do not provide a suitable environment for the use of motivational techniques associated with Theory Z.
Its strength lies in the fact that because of improved standards of education and changed social and political values, many
employees have wider expectations from the workplace and expect to be consulted and to participate.
The application of Theory Z will therefore depend upon:
the organisational culture, structure and objectives
the procedures and practices involved in the organisation
the technology, environment and product or service
the organisations history and attitude
the level of satisfaction that already exists in an individuals task or role.
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3 Overview
Recruitment of staff, especially if large numbers are involved, may be time consuming and a drain on resources. Additionally, the
expertise may not exist within the organisation, requiring the organisation to seek suitable candidates outside.
(a) Internal promotion describes the situation where an organisation has an explicit policy to promote from within and where
there is a clear and transparent career structure. This is typical of many management and administrative staff and of certain
sectors of the economy such as the public services.
The advantages of internal promotion:
it acts as a source of motivation and provides good general morale amongst employees
staff seeking promotion are known to the employer
inexpensive in terms of time and money
training and induction costs are minimised
further training can be product and organisational specific
the culture of the organisation is understood by the individual
illustrates the organisations commitment to encouraging the staff
the individual will already be familiar with the other members of the organisation.
(b) External recruitment describes the situation where the organisation decides to recruit someone from outside the organisation
to fill a staff vacancy.
The advantages of external recruitment:
may be essential if particular skills or expertise are not available within the organisation
is necessary to restore staffing levels or where an organisation urgently needs new employees
can bring new ideas and novel approaches to the organisation and to the specific task
provide experience and work methods from other employers.
(c) Any organisation which is considering the use of external recruitment consultants would make its decision upon the following:
the availability, level and appropriateness of expertise available within the organisation and its likely effectiveness
the cost of using consultants against the cost involved in using the organisations own staff, recognising the level of the
vacancy or vacancies against the consultants fee the particular expertise of the consultants and the appropriate experience with any particular specialised aspect of the
recruitment process
the level of expertise required of potential employees and therefore the appropriate knowledge required of the consultants
the need for impartiality; this may be of particular importance with public sector appointments, organisations with
particular needs of security or impartiality or where it is felt that an external, objective assessment is required
the time involved in the consultants needing to learn about the organisation, its requirements and the vacancy or
vacancies
if there is a ready supply of labour then consultants may be less useful, standard vacancies may be readily filled by
advertising or similar inexpensive means
the views of internal staff as to the likely effect of using outside consultants
what effect the use of consultants might have on the need to develop expertise within the organisation, the use of
consultants will not assist with developing internal organisational expertise
the likelihood of existing staff to have misgivings about the presence of, or recommendations of, outside consultants
which can lead to mistrust and rejection of any candidates recruited by the consultants.
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4 Overview
Individuals are often reluctant to undertake further learning, especially in the workplace. It is important therefore that managers
understand the way in which individuals actually learn, if any training programme is to be succesful.
(a) David Kolb suggests that learning is a series of steps based on learning from experience. He suggested that classroom learning
is false and that actual learning comes from real life experiences. Learning is experiential and comes from doing, this ensures
that learners actually solve problems.
Kolbs experiential learning cycle
concrete experiences
testing the observation
implications of and
concepts in new situation reflection
formation of abstract
concepts and generalisations
The first stage (concrete experiences) is the situation where the person is learning something new.
The second stage (observation and and reflection) is so called because the experience is being reviewed.
The third stage (concepts and generalisations) is when the experience has been accepted or rejected.
The fourth stage (concepts in new situations) is when the person calculates how and when to apply that which has been learned.
(b) HONEY AND MUMFORD have identified four learning styles.
Theorists are concerned with forming principles or how does this relate to that? They think problems through in a vertical,
step by step logical way and tend to be perfectionists who do not rest easy until things are tidy and fit into a rational scheme.
Theorists are usually detached, analytical and dedicated to rational objectivity rather than anything subjective or ambiguous.
Often known as CONCLUDING.
For them training must be:
programmed and structured
designed to allow time for analysis
provided by others who share the same preference for ideas and analysis.
Reflectors are concerned with observation and reflection or I would like time to think about this. They like to stand back and
ponder experiences and observe them from many different perspectives. They collect data, both first hand and from others,
and prefer to think about it thoroughly before coming to any conclusion. Thoughtful people, they prefer to take back seats in
meetings and discussions. Often known as REVIEWING.
Reflectors need an observational approach to training
need to work at their own pace
do not find learning easy, especially if rushed conclusions are carefully thought out
slow, cautious and non-participative.
Activists are concerned with actual experience Whats new? Im game for anything. They involve themselves fully and
without bias in new experiences, are open minded, not sceptical and this tends to make them enthusiastic about anything
new. They are gregarious people constantly involving themselves with others but, in so doing, they seek to centre all activities
around themselves. Often known as DOING.
Activists have a practical approach to training
prefer practical problems, a dislike of theory
insist on having hands on training
enjoy participation and challenge
flexible, optimistic
tend not to prepare
are easily bored.
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Pragmatists are concerned with deliberate testing or How can I apply this in practice? They are keen on trying out ideas,
theories and techniques to see if they work in practice, positively search out new ideas and take the first opportunity to
experiment with applications. They are essentially practical, down to earth people who like making practical decisions and
solving problems. Often known as PLANNING.
Pragmatists need to see a direct value and link between training and real problems.
enjoy learning new techniques and tasks
good at finding improved ways of doing things
aim to do things better
impatient if new ideas are not reflected in practical applications.
5 Overview
Motivation is fundamental to the task of management. Many different theories have been presented on how management might
motivate employees; Adams equity theory is an attempt to bring a more modern approach to the topic, based on the idea of
distributive justice.
(a) The process theory of motivation asks the question How can people be motivated?
The process theory of motivation does not emphasise the need for fulfilment through work (as in the content theory), but
concentrates upon the processes through which individuals are motivated. They attempt to explain how individuals start,sustain and direct behaviour and assume that individuals are able to select their own goals and means of achieving those
goals through a process of calculation. Process theory emphasises the importance of rewards, often financial.
(b) Equity theory focuses on the feelings of the individual and how fairly they feel they have been treated in comparison with
treatment received by others. It is sometimes referred to as exchange theory; individuals expect certain outcomes in exchange
for certain efforts and contribution to the organisation. When an individual perceives that his or her efforts are equal to others
and the rewards are the same, then equity exists. If the perception is that the efforts and rewards of one person are unequal
to others, then there is inequity.
(c) When an individual has feelings of negative inequity, he or she can
change the amount of effort put into the task
change the nature or amount of reward required
change the basis of comparison
distort the comparisons psychologically
leave the work situation or employer.
6 Overview
The need for clear and concise communication and the consequences of poor communication must be understood by a profession
which exists to provide information to others. Poor communication leads to ineffective control, poor co-ordination and management
failure.
(a) Good communication is important because:
individuals know what is expected of them
better co-ordination within the organisation
improves control of the organisations plans, procedures and staff
the instructions of management are understood
encourages group and team cohesiveness
can lead to the reduction of stress
bias, distortion or omission can be removed
secrecy and misunderstanding is reduced or removed
information is received by appropriate person
conflict in the workplace is reduced
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(b) Barriers to communication include:
the personal background of the persons communicating
language differences
use of jargon
different education levels
noise; that is the message confused by extraneous matters
the perception of individuals
conflict within the organisation
overload; that is too much information being communicated at once
problems of distance
basic misunderstanding
accidental or deliberate distortion of information.
(c) Barriers to communication may be overcome by:
consideration of the needs and understanding of recipients
careful and clear reporting at all levels
express information clearly and concisely
not using jargon or abbreviations
using more than one communications system
encouraging dialogue rather than monologue
ensuring as few links as possible in the communication chain
ensuring feedback.
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Part 1 Examination Paper 1.3
Managing People December 2002 Marking Scheme
1 (a) (i) Description of the main features of a sex discrimination policy Up to 10 marks
(ii) Description of the main characteristics of a race relations policy Up to 6 marks
(Maximum for Part (a) 16 marks)
(b) Reasons for an equal pay policy Up to 6 marks
(Maximum for Part (b) 6 marks)
(c) Description of key points of policy and means of discrimination Up to 8 marks
(Maximum for Part (c) 8 marks)
(d) Discussion and recognition of the differences Up to 10 marks
(Maximum for Part (d) 10 marks)
(Total for Question 40 marks)
2 (a) Description of Theory Z Up to 10 marks
(One mark per characteristic) (Maximum for Part (a) 10 marks)
(b) Discussion on Theory Z Up to 5 marks
(Maximum for Part (b) 5 marks)
(Total for Question 15 marks)
3 (a) Description of the advantages of internal recruitment Up to 5 marks
(Maximum for Part (a) 5 marks)
(b) Description of the advantages of external recruitment Up to 5 marks
(Maximum for Part (b) 5 marks)
(c) Description of three factors Up to 5 marks
(Maximum for Part (c) 5 marks)
(Total for Question 15 marks)
4 (a) Brief description of the four stages in the experiential learning cycle Up to 4 marks
(Maximum for Part (a) 4 marks)
(b) Description of the learning styles and their implications for training programmes Up to 11 marks
(Maximum for Part (b) 11 marks)
(Total for Question 15 marks)
5 (a) Description of process theory Up to 5 marks
(Maximum for Part (a) 5 marks)
(b) Description of equity theory Up to 5 marks
(Maximum for Part (b) 5 marks)
(c) Description of negative inequity Up to 5 marks
(Maximum for Part (c) 5 marks)
(Total for Question 15 marks)
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6 (a) Explanation of the importance of good communication
(One mark per factor) Up to 5 marks
(Maximum for Part (a) 5 marks)
(b) List five barriers to communication
(One mark per barrier) Up to 5 marks
(Maximum for Part (b) 5 marks)
(c) Description of overcoming barriers
(One mark per factor) Up to 5 marks
(Maximum for Part (c) 5 marks)
(Total for Question 15 marks)
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Managing People
PART 1
MONDAY 9 JUNE 2003
QUESTION PAPER
Time allowed 3 hours
This paper is divided into two sections
Section A This question is compulsory and MUST be
answered
Section B FOUR questions ONLY to be answered
P
aper1.3
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Section A This ONE question is compulsory and MUST be attempted
1 Sunshine Sweets is a manufacturer of additive free, organic childrens candies. With the rise in demand for additive
free childrens products, Sunshine Sweets has expanded its production capacity to almost double what it was two
years ago and trebled the number of employees. Until recently the board of directors, made up of the two founders
Emma Watkind and Jenna Pain, took charge of day to day business. Both have now allowed management more
freedom than before.
Despite success in the market, as the company has grown some problems have begun to arise. Phil Short, the factory
manager has been with the company since the beginning and since the expansion in the number of employees, finds
controlling and communicating with such a large workforce difficult. He has resorted to pinning notices and memos
of all kinds to notice boards, circulating his own reports to colleagues who should not be receiving them and refusing
to organize meetings.
The newly appointed production manager Mark Mason is an engineer and deputy to Phil. He has found that he has
little idea of whats going on in the factory and is finding communication channels are non existent between the
management team, supervisors and directors. The financial controller, Debbie Purple is equally frustrated and finds
communicating with anyone in the production area of the factory to be almost impossible.
In addition, the workforce, despite being well paid and trained, is fragmented and not working together. The rapid
expansion of the company has led to poor internal communication. As a consequence workers are suffering from
absenteeism, low morale and confusion brought about by endless rumours about the future of the company. This is
because the line supervisors are also unaware of what is going on and consequently are unable to communicate
managements plans and objectives to the workforce, or to make management aware of the concerns of the workforce.
Required:
You are a consultant brought in by the directors to advise on the current problems. They believe the current
problems stem from poor and mis-directed communication and think that establishing committees will improve
communication. You have been asked to:
(a) Explain the need for good communication within any organisation. (5 marks)
(b) Identify five barriers to communication that might exist in Sunshine Sweets. (5 marks)
(c) Explain how the barriers identified in (b) can be overcome and identify the alternative methods of
communication available to the management. (10 marks)
(d) Explain to the management of Sunshine Sweets the importance of communication, the form it takes and the
directions in which it might flow in an organisation. (10 marks)
(e) Advise on the suitability of committees as methods of communication, outlining their usefulness and
shortcomings. (10 marks)
(40 marks)
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Section B FOUR questions ONLY to be attempted
2 Performance Management is defined as a means of achieving better results by understanding and managing overall
organisational performance.
Required:
Describe the five stages typically involved in the process of performance management.
(15 marks)
3 All organisations need to recruit new employees. An important step in the process is the selection interview.
Required:
(a) Explain the purpose of the selection interview. (4 marks)
(b) Explain the advantages and the disadvantages of:
(i) the interview by one person defined as the face to face interview; (6 marks)
(ii) the interview with many people defined as the panel interview. (5 marks)
(15 marks)
4 The health and safety of employees has become increasingly a matter for management.
Required:
(a) Briefly describe three hazards to health and safety that might be found in the workplace and demonstrate
why they are hazards. (5 marks)
(b) Briefly describe general policies that an organisation might take to avoid risks in the workplace. (10 marks)
(15 marks)
5 An organisation has decided to create a team oriented approach to business.
Required:
Describe Tuckmans stages of team development.
(15 marks)
3 [P.T.O.
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6 Your manager has been called upon to provide advice, guidance and counselling to employees.
Required:
(a) Explain what is meant by counselling in the work place. (2 marks)
(b) Describe the skills a manager would require to fulfil the role of the counsellor. (7 marks)
(c) Briefly describe three advantages of counselling for the organisation. (6 marks)
(15 marks)
End of Question Paper
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Answers
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Part 1 Examination Paper 1.3
Managing People June 2003 Answers
1 Communication is a core activity of management and the accounting profession. It is the process of transmitting information from
one person to another, or from one organisation to another, or a combination of both.
Communication can be described as the process by which ideas and information are transmitted to others for the purpose of
effecting a desired result. Ideas and information are the content of the message communicated.
(a) The function of communication is to ensure that every member of the organisation knows what is expected of them and toallow an opportunity for feedback. Good communication in an organisation is critical in ensuring coordination and control of
individuals, groups and departments.
The management of Sunshine Sweets need to understand that good communication ensures individuals know what is
expected of them, the correct information is received by the appropriate person and consequently there is co-ordination within
the organisation. Good communication ensures that there is control of the organisations plans, procedures and the
instructions to staff by management are understood. Group and team cohesiveness is encouraged and stress can be reduced.
Many problems such as bias, distortion and omission can be reduced and removed, as can secrecy, rumour and innuendo,
resulting in a reduction of conflict.
(b) The need for clear and concise communication and the consequences of poor communication should be understood by the
management of Sunshine Sweets. Poor communication leads to ineffective control, poor co-ordination and management
failure. Very often barriers to communication are not recognised as such. In Sunshine Sweets the directors, managers and
staff are using different phrases and expressions.Barriers to communication are many; the personal background of the persons communicating, including language differences,
the use of jargon, especially by different professions and different education levels as is often the case in factories and is the
case here. The concept of organisational noise is often an issue. The message is confused by matters unrelated to the matter
in hand, or there is overload, where too much information is being communicated. The different perception of individuals can
lead to conflict within the organisation and thus to a communication barrier. The distance between those individuals
communicating with each other is often overlooked in the business environment. This often leads to distortion of information
and thus to misunderstanding between departments and individuals.
(c) Communication cannot take place if there are barriers to the communication process. These must be recognised and removed.
Barriers to communication can be overcome by a consideration of the needs and understanding of the message recipients
with careful and clear reporting. Information should be expressed clearly, avoiding jargon or abbreviations. The use of more
than one communications system can assist, as does the encouragement of dialogue rather than monologue and ensuring
that there are as few links as possible in the communication chain.Communication can often be improved by identifying appropriate written, verbal or electronic methods. Meetings, interviews
and video conferencing involve personal, face to face communication.
Telephone, email, faxing and public address systems can be used where personal communication methods are difficult.
Written communication is often the most suitable and clearest means of communication. This takes the form of memoranda,
internal and external reports, forms, notices, house journals, rules and procedures, standard documentation, manuals and
job descriptions.
Visual communication is a powerful communication media. Charts, files, slides, videos or films provide an immediate and
clear message.
Electronic means of communication are increasingly becoming more relevant. Electronic mail, document imaging, telex, fax,
internet and email are instantaneous and provide clear communication possibilities.
(d) Communication is vital in all organisations and the communication process may take many forms. It is important that
managers and supervisors recognise the nature of channels of communication.
There are many forms of communication within an organisation, both formal and informal, but in the main, communicated
information often flows through quite clear channels and in defined directions. The direction of the three main information
flows are downwards, upwards and lateral.
Downwards communication (or superior-subordinate communication)
This form of communication is often the one most easily recognised. Its purpose is to give specific directives, provide
information about procedures and practices or provide information about the task in hand. Control of subordinates and
information about their performance is an important use of downward communication, as is the provision of information on
organisational and departmental objectives.
Upwards communication (or subordinate initiated communication) tends to be non directive in nature and generally takes
two forms, personal problems or suggestions or technical feedback as part of the organisations control system.
Lateral or horizontal communication is increasingly important and necessary in modern organisations, especially astraditional communication theory assumes only vertical communication. It can take the form of task co-ordination, such as
departmental managers or supervisors meeting regularly, problem solving through departmental meetings to resolve an issue,
and sharing ideas with other departments. Properly understood, this form of communication can resolve conflict and
interdepartmental friction.
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(e) One traditional and well tried formal communication method is the establishment of a committee. Properly structured and
understood, they are a useful method of communication. They can however be wasteful and time consuming if not structured
and managed effectively.
A committee is a group of people who meet for a particular purpose. Committees differ from other forms of communication,
notably teams, because they are often a permanent part of the organisations structure and communication mechanism.
Committees make formal recommendations and are able to make decisions, or if need be, have the authority to delay
decisions if insufficient information is available. Committees provide inter departmental co-ordination, can relay decisions in
the form of briefings, represent different people, departments and disciplines and through their membership provideinformation and feedback to others.
Committees are often used as a task force or working party to solve problems by consultation, through synergy by
brainstorming in an effort to arrive at different or difficult decisions that cannot or will not be made by an individual.
If the workforce is fragmented, committees can be useful to bring co-ordination and the sharing of information and viewpoints.
2 Accountants as managers should develop and understand the process that links employee performance with organisational goals
and organisational success. However, before the process of performance management begins the organisation must itself have
developed a clear, planned strategy.
The process of performance management typically involves five stages:
Stage One identify and describe the essential job functions and competencies and relate them to the objectives of the organisationas laid out in the corporate plan.
Stage Two develop realistic and appropriate performance standards which will form the basis of a performance agreement.
This defines the expectations of the individual or team and includes the establishment of performance standards and indicators,
together with the skills and competencies needed.
Stage Three draw up an individually agreed performance and development plan. This details the action needed to improve
performance and involves identification of areas in need of development, agreement on performance and development and training
requirements.
Stage Four performance is evaluated throughout the year, counselling and guidance is given as appropriate. Activity requirements
are updated and control action taken. Communicating constructive performance evaluation is important as is the giving and
receiving of feedback about performance.
Stage Five the performance review. At an agreed time during the year, actual performance is measured against the agreed
performance plan. The meaningful part of stage five is the planning and providing of education and development opportunities to
build upon and improve employee performance in the future.
3 Interviews are extensively used for the recruitment of new employees, but have been criticised for failing to identify appropriate
candidates suitable for the organisation. It is essential that professional accountants recognise both the problems and opportunities
that formal selection interviews present.
(a) The purpose of the selection interview is to find the best possible person for the position and who will fit into the organisation.
Those conducting the interview must also ensure that the candidate clearly understands the job on offer, the associated career
prospects and that he or she feels that fair treatment has been provided throughout the selection process.
In addition, the interview also provides the opportunity to provide a good impression of the organisation, whether the
candidate has been successful or not.
(b) (i) The face to face interview is the most common form of interview. In this situation the candidate is interviewed by a
single representative of the employing organisation.
The advantages of such interviews are that they establish an understanding between the participants, are very cost
effective for the organisation (as compared with panel interviews) and, because of the more personal nature, ensure that
candidates feel comfortable.
The disadvantages however are that the selection relies on the views and impression of a single interviewer which can
be both subjective and biased. In addition, the interviewer may be selective in questioning and it is easier for the
candidate to hide weaknesses or lack of ability.
(ii) Panel interviews are often used for senior appointments and consist of two or more interviewers.
The advantages of such interviews are that they allow opinion and views to be shared amongst the panel. They have
the authority to reach immediate decisions and provide a more complete picture, hence the problems or any bias
inherent in face to face interviews can be removed.
The disadvantages however are that they can be difficult to control. Interviewers may deviate or ask irrelevant questions
and they can be easily dominated by a strong personality who is able unduly to influence others. In addition, such
interviews can often result in disagreement amongst the panel members.
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4 Health and safety is an issue for all organisations. It is something that has only recently become a responsibility for management.
Few managers and employees take safety seriously or indeed recognise the dangers in the workplace.
(a) All places of work contain hazards, including the accounts or finance office. Work and office based hazards can include
slippery and wet floors, especially after cleaning. Torn and worn floor coverings can lead to slips or falls.
In many offices, computer, telephone and electrical leads are left to hang loose over which employees may trip, as they could
do over obstacles in corridors or stairways used for storage.
Poor lighting and unlit areas, especially corridors and stairs can also lead to trips, falls or collision with other objects.
Unmarked glass doors are particularly dangerous since not only could employees collide with them, but sufficient force could
cause breakages and significant injury. Filing cabinets which are top heavy, or left open can fall on to employees whilst the
lifting of heavy items, papers and files can often lead to physical injury to the back. Perhaps the most dangerous of all is the
deliberate removal of safety guards or screens from machines or machines being operated by untrained staff, which can lead
to very serious injury.
Other, less obvious physical hazards to employees are the danger from staff using drugs or abusing alcohol, for which the
organisation must have a disciplinary procedure. Computer screens and repetitive strain injury are other, less obvious dangers
but can be alleviated by screen covers, careful use of computers, breaks and exercise.
(b) Management should be aware that appropriate preventative action can reduce the risks in the workplace. These include:
Consultative participation The most important and involves formal participation between management and employees (or
their representatives) such that health and safety rules are relevant, understood, accepted and followed.
Safety rules and instructions Should be formalised, issued to all employees and form part of any training programme.
Encourage safety consciousness Ensures that safety forms a part of the culture, practice and duties of all the workforce, that
pride is taken in maintaining a good record of safety.
Materials handling A major cause of accident and injury, even in an office environment. Management should ensure that
materials handling is minimised or designed for safe working and operation and that appropriate training and equipment is
provided.
Satisfactory safety standards - Should be adopted so that everyone is aware of the standards required to maintain a safe
workplace and against which safety measures can be measured.
Adoption of an ongoing maintenance programme So that temporary measures to keep equipment working do not prejudice
safety.
5 Much has been written about the need for teams and team working; they have to develop, mature and often eventually terminate.
It is possible to identify distinct stages of development through which teams pass.
B W Tuckman has described these stages as:
Forming the members meet and decide upon the purpose of the team and how it will operate. At this stage the team is no more
than a collection of individuals, finding out about one another and about the task, although objectives may be unclear. This stage
is wasteful and time consuming, although essential since the prospective team members are not at this stage comfortable with
each other.
Storming the phrase storming is a deliberate reference to this stage which is characterised by conflict. Previous ideas, ideals,
norms, attitudes and behaviour is challenged and often rejected. There is competition for the roles within the team. This is a
constructive and often fruitful stage with trust developing. If the individuals come successfully through this stage then a stronger
team will result.Norming the norms under which the team will operate are established. The team is settling down, members investigate ideas
and test the reactions of the team as a whole and consequently, norms are established. In addition, it is at this stage that the team
establishes patterns of behaviour, levels of trust and the methods by which decisions will be taken.
Performing the team is now complete and able to perform to its full potential. Difficulties with team roles, individual conflicts
and problems of adjustment have been resolved.
Dorming has been suggested as a final and fifth stage. This is when the team becomes complacent, has lost interest in the task
and exists only for self preservation.
(Some students may refer to this final phase as adjourning or mourning.)
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6 Situations can arise in the workplace which require particular and careful people-centred skills. In such circumstances, professional
accountants as managers may be called upon to act as counsellors. What constitutes counselling and the sensitive skills required
in this process is often misunderstood.
(a) Counselling can be defined as when a person agrees explicitly to offer time, advice, guidance and support to another person
(or persons) temporarily in the role of client; in the organisational context, the client being a fellow employee or subordinate.
It may be used in giving career development advice and in coaching and mentoring staff.
(b) In assuming the role of the counsellor, the manager should be able to:
help others to identify problems, issues and possible solutions to problems
adopt a passive role and avoid leading or suggesting
encourage reflection and discussion of past issues
allow the employee to lead and talk around issues
use open questions to help the employee explore ideas and feelings
maintain active listening and not interrupt the employee
speak only to clarify issues and elicit answers when appropriate
(c) For the organisation, the advantages of counselling are that:
it provides a confidential service to the employee to discuss problems
allows human resources policy to be developed based upon an understanding of individual problems
provides a service to external agencies to assist with personal problems if appropriate
prevents under performance and increases commitment
demonstrates organisational commitment to the employees demonstrates commitment for particular matters such as career development, redundancy or retirement
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Part 1 Examination Paper 1.3
Managing People June 2003 Marking Scheme
1 (a) Brief description of those factors that ensure good communication Up to 5 marks
(one mark each)
(Maximum for Part (a) 5 marks)
(b) Identification of five barriers Up to 5 marks
(one mark each)(Maximum for Part (b) 5 marks)
(c) Explanation of how communication barriers can be overcome Up to 5 marks
Identification of alternative communication methods Up to 5 marks
(Maximum for Part (c) 10 marks)
(d) Explanation of different channels Up to 10 marks
(Maximum for Part (d) 10 marks)
(e) Outline of the usefulness of committees Up to 10 marks
(Maximum for Part (e) 10 marks)
(Total for Question 40 marks)
2 (a) Description of the five stages in performance management Up to 15 marks
(Three marks awarded for description of each of the five stages)
(Total for Question 15 marks)
3 (a) Explanation of the purpose of the selection interview Up to 4 marks
(Maximum for Part (a) 4 marks)
(b) Explanation of, and the advantages and the disadvantages
(i) the face to face interview Up to 6 marks
(ii) the panel interview Up to 5 marks
(Maximum for Part (b) 11 marks)
(Total for Question 15 marks)
4 (a) Brief description of any three hazards that might be found in the workplace Up to 5 marks
(Maximum for Part (a) 5 marks)
(b) Brief description of preventative action Up to 10 marks
(Maximum for Part (b) 10 marks)
(Total for Question 15 marks)
5 Description of the five steps in team development Up to 15 marks
(Three marks for each step, including dorming)
(Total for Question 15 marks)
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6 (a) Explanation of the term counselling in the workplace Up to 2 marks
(Maximum for Part (a) 2 marks)
(b) Explanation of the role of the manager as counsellor Up to 7 marks
(Maximum for Part (b) 7 marks)
(c) Brief description ofthree advantages of counselling for the organisation Up to 6 marks)
(Two marks for each of the advantages described) (Maximum for Part (c) 6 marks)
(Total for Question 15 marks)
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