Conservation of Forests

The study by Otley et al. reviews management control literature and looks into the development of management control literature through organizational theories.  The article uses management and accounting control through Scots (1981) framework to organize the literature.  As highlighted by Otley and others, there is a major difference between management control and financial control. Management control entails everything that a manager does in order to attain goals and objectives within an established timetable. On the other hand, Otley and others argues that financial control refers to different strategies that are taken to regulate financial performance of the business. Financial control is a measure of how a company department controls financial costs.  According to Otley et al., systems theory helps us to understand management control in different ways. Systems theory helps us to understand how different department in the organization play complementary role in management control. – As highlighted by Otley et al, Scott looks into organizations as open, closed, rational and natural. Closely system looks into the organization as independent from their environment while open system model sees the organization as an open system that has permeable and variable boundaries with their environment. Rational model assumes that organizations are designed to pursue explicit objectives while the natural system model emphasizes the importance of unplanned and spontaneous process. He argued that the distinction between rational and natural systems can be applied in both sides of closed and open system divide.  A review of the model provided by Scott shows that accounting is still an important element in management control. Accounting is still seen as a pre-eminent technology which can be used to integrate diverse activities ranging from strategy to operation in ensuring accountability.  Reducing the values to accounting measurements is therefore likely to slide management control into mere technical practices, which means increasing emphasis on accounting will limit understanding of broader importance of management control. Although the focus of management control has been leaned towards financial performance, non financial performance can as well help us to understand management control within an organization. Non financial performance management can helps us understand management control by revealing how the company can control management in unquantifiable manner.  This means it can reveal the human relations side of the organization and how it affects management control

The article by Nkhoma (2009) also looks at evolution of performance and management control taking case example of companies in Malawi.  The article by Nkhoma (2009) shows that management control practices are evolving especially in developing countries like Malawi. This article also contains a small part that explains management control systems in the perspective of less developed countries pointing out to the differences that exists between developed and less developed countries.   In this article Nkhamo shows that firms looks into the possible of using management control systems in order to reduce cost. In the context of the organizations analyzed in this study, which emphasized on management control systems post-privatization, the study showed that the quality of products and services for these firms are much better with effective management and accounting controls than before privatization. Although Nkhamo does not make a clear distinction between management control and financial control, findings from this research shows that management controls are important in improvement of costing systems.  Nkhamo does not delve in the relationship between management controls and systems theory but his finding shows the importance of close knit organizational department that are geared towards achieving organizational goals. In addition, Nkhamo (2009) also shows that financial/accounting control. Nkhamo shows that financial control is important to ensure the firm recovers from financial losses in the process of privatization.

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