Question Answer Marks 6 Discuss the view that the limitations of Income statements and 20 statements of financial position significantly reduce their usefulness as measures of business performance. Level Description Marks 5 Effective evaluation of the view that the limitations 17-20 of these two financial statements significantly reduce their usefulness as measures of business performance. 4 Limited evaluation and good analysis of the view 13-16 that the limitations of these two financial statements significantly reduce their usefulness as measures of business performance. 3 Analysis of the view that the limitations of these 11-12 two financial statements significantly reduce their usefulness as measures of business performance 2 Limited analysis, with application, of the view that 5-10 the limitations of financial statements affect their usefulness 1 Understanding of financial statements / business 1-4 performance. 0 No creditable content. 0 Answers could include: A focus on the component parts of the two financial statements. A reference to those aspects of the statements that could be used as measures of business performance such as profit, level of sales, stock levels, value of assets, long-term liabilities. Some analysis of the value/usefulness of such measures. Leading to a recognition of the limitations of such quantitative measures: Numbers may be incomplete or approximate. Trends not shown. Assumptions made by accountants. Window dressing of accounts. Historic costs may not reflect economic reality. Conventions, assumptions, judgements may lead to imprecision. Non-monetary factors ignored.Question Answer Marks 6 Evaluation could include: 0 Reference to the limitations of financial accounts and consideration of what might be missing, such as qualitative factors reputation, morale of staff, nature of organisation culture, capability of senior management etc. 0 Opportunity to add ressievaluate the relative usefulness of quantitative and qualitative measures of business performance. How significant are the limitations? Do we need both to get a full understanding of health I strength of a business? The case for a balanced scorecard approach? 6 Discuss how Maslow's 'hierarchy of needs' theory could be used by the managers of a retail business to motivate employees. [20]