ACCT 725 Q1WW - Assignment 6-2 - Multiple Versions of the Plan ACCT 725

Assignment 6-2: Multiple Versions of the Plan Franklin University ACCT 725-Q1WW: Management Control Processes and Systems Professor Alisa Di Salvo March 31, 2019 Case and Background Information Anthony Rizzo, a financial analyst for Thom Thomson, chairman/CEO for Anderson Industries, Inc., was scheduled to present the “Corporate Restructuring Program” (p. 332) to the Board of Directors for the annual strategic planning meeting (Merchant & Van der Stede, 2017). This study source was downloaded by from CourseH on :18:28 GMT -06:00 2 Mr. Rizzo’s presentation focused on providing detailed information to further clarify the program with its 83 projects to the Board of Directors (Merchant & Van der Stede, 2017). Only hours before the presentation Mr. Rizzo was contacted by Sharon Carpenter, head of financial planning, of budgetary issues that may adversely affect his planned and approved presentation (Merchant & Van der Stede, 2017). Mr. Rizzo tried to no avail to contact Mr. Thomson regarding the lastminute discovery concerning the calculated operating expense ratios of the budget submissions of the business units, but he was in a meeting with the Audit Committee (Merchant & Van der Stede, 2017). Mr. Rizzo was undecided on how to proceed with his presentation given this new information provided by Ms. Carpenter (Merchant & Van der Stede, 2017). Case Analysis Mr. Thomson, chairman/CEO, developed the “Corporate Restructuring Program” (p. 332) which not only comprised of 83 projects, but also the central component of “reduced expenses by $100 million while maintaining current revenue levels” (p. 332), thus reducing the operating expense ratio (Merchant & Van der Stede, 2017). Management viewed the central component as a difficult target to meet, but they wanted the opportunity to prove the company’s capability to meet such a target (Merchant & Van der Stede, 2017). The case indicated no input from subordinates and no mention of incentives. The main point in the case is Sh