A number of terms are listed below:
Belief systems............... Boundary systems
Economic value added (EVA)....... Imputed cost of investment
Interactivity................. Intrinsic motivation
Malus...................... Return on investment (ROI)
Say on pay................. Social responsibility
Weighted-average cost of capital (WACC)
REQUIRED
Select the terms from the above list to complete the following sentences.
Governance, or the management stewardship of assets management does not own, according to laws and regulations is more closely scrutinized than before. Legal reform in the United
States now mandates a shareholder vote on any executive compensation packages, referred to as a ___ __ ___. While we are very familiar with executive bonus, a new claw back of previous compensation, or a _____, is becoming a feature of compensation. One important performance measure that could determine a bonus or malus is the accounting ______ __ __________ (___), calculated by dividing the net income by the investment made. Another measure is the ROR, also called the _______ ____ __ __________, which represents a return forgone from tying up cash in existing investments. A third measure is the ________ _____ _____ (___), which is calculated by subtracting the total assets minus current liabilities multiplied by the ________ _______ ____ __ _______ (____) from the after-tax operating income. But executive performance is not the only factor or even the most important factor affecting corporate profitability, excellent governance, and corporate ______ ______________. Good management control systems will separate the effects of good luck from good management on performance. Additional considerations when designing a good management control system include ________ _______, ______ _______, _________ __________, and _____________.