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February 2016 32.00

Paper F5

Performance Management

This ACCA Study Text for Paper F5 Performance Management has been comprehensively reviewed by the ACCA examining team. This review guarantees appropriate depth and breadth of content and comprehensive syllabus coverage.

In addition to ACCA examining team reviewed material you get:

A user-friendly format for easy navigation Exam focus points describing what the examining team will want you to do Regular Fast Forward summaries emphasising the key points in each chapter Questions and quick quizzes to test your understanding A practice question bank containing exam- standard questions with answers A full index All you need in one book

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Performance M

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For exams in Septem

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17

Paper F5Performance Management

For exams in September 2016, December 2016, March 2017 and June 2017

ACCA ApprovedStudy Text

ACF5ST16 (RICOH).indd 1-3 05/02/2016 16:03

File Attachment9781472746641.jpg

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S T U D Y T E X T

PAPER F5 PERFORMANCE MANAGEMENT

BPP Learning Media is an ACCA Approved Content Provider. This means we work closely with ACCA to ensure this Study Text contains the information you need to pass your exam.

In this Study Text which has been reviewed by the ACCA examination team we:

Highlight the most important elements in the syllabus and the key skills you will need

Signpost how each chapter links to the syllabus and the Study Guide

Provide lots of exam focus points demonstrating what is expected of you in the exam

Emphasise key points in regular fast forward summaries

Test your knowledge in quick quizzes

Examine your understanding in our practice question bank

Reference all the important topics in our full index

BPP's Practice & Revision Kit also supports this paper.

FOR EXAMS IN SEPTEMBER 2016, DECEMBER 2016, MARCH 2017 AND JUNE 2017

ii Introduction

First edition 2007 Ninth edition February 2016

ISBN 9781 4727 4422 7 (Previous ISBN 9781 4727 2675 9)

e-ISBN 9781 4727 4664 1

British Library Cataloguing-in-Publication Data

A catalogue record for this book is available from the British Library

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BPP Learning Media Ltd BPP House, Aldine Place London W12 8AA

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Printed in the United Kingdom by

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We are grateful to the Association of Chartered Certified Accountants for permission to reproduce past examination questions. The suggested solutions in the practice answer bank have been prepared by BPP Learning Media Ltd, unless otherwise stated. BPP Learning Media Ltd 2016

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Contents iii

Contents Page

Introduction Helping you to pass v Studying F5 vii The exam paper and exam formulae viii Syllabus and Study Guide ix

Part A Specialist cost and management accounting techniques 1 Costing 3 2a Activity based costing 19 2b Target costing 31 2c Life cycle costing 39 2d Throughput accounting 49 2e Environmental accounting 65

Part B Decision-making techniques 3 Cost volume profit (CVP) analysis 77 4 Limiting factor analysis 101 5 Pricing decisions 127 6 Short-term decisions 163 7 Risk and uncertainty 183

Part C Budgeting and control 8 Budgetary systems 217 9 Quantitative analysis in budgeting 247 10 Budgeting and standard costing 267 11 Variance analysis 287 12 Planning and operational variances 311 13 Performance analysis and behavioural aspects 327

Part D Performance measurement and control 14 Performance management information systems 345 15 Sources of management information and management reports 363 16 Performance measurement in private sector organisations 381 17 Divisional performance and transfer pricing 411 18 Further aspects of performance management 433

Practice question bank 449 Practice answer bank 479 Index 533

Review form

iv Introduction

Introduction v

Helping you to pass

BPP Learning Media ACCA Approved Content Provider

As an ACCA Approved Content Provider, BPP Learning Media gives you the opportunity to use study materials reviewed by the ACCA examination team. By incorporating the examination team's comments and suggestions regarding the depth and breadth of syllabus coverage, the BPP Learning Media Study Text provides excellent, ACCA-approved support for your studies.

The PER alert

Before you can qualify as an ACCA member, you not only have to pass all your exams but also fulfil a three year practical experience requirement (PER). To help you to recognise areas of the syllabus that you might be able to apply in the workplace to achieve different performance objectives, we have introduced the 'PER alert' feature. You will find this feature throughout the Study Text to remind you that what you are learning to pass your ACCA exams is equally useful to the fulfilment of the PER requirement.