Accounting for decision making: when there are no resource constraints

Abstract

For planning, management will need to make decisions about future business opportunities to ensure that the organization’s objectives are met. A large proportion of these decisions will relate to the short term and will be expressed in financial terms in the organization’s budget (see Chapter 17). Management will also he required to make decisions of a more immediate nature which relate to opportunities that were not anticipated at the planning stage. To ignore profitable opportunities because they have not been specifically included in the budget would clearly be irresponsible in a dynamic business environment. These decisions can be categorized as follows.