A study on divisional performance analysis of Shree Renuka Sugar Ltd.
Purushottam N Vaidya, Savita Bhairappanavar
One of the fundamental functions of management accounting is facilitating managerial control. Various devices are used by the management in performing this important function. Decentralization is a necessary response to the increasing complexity of the environment that organisations face and the increasing size of most organisations. Nowadays it would be impossible for one person to make all the decisions involved in the operation of even a small company, hence senior managers delegate decision-making responsibility to subordinates. The work of all the divisions must be conducted in such a manner that the work of no division comes in the way of profitability of other divisions or the profitability of company as a whole. The essence of divisional performance measurement is that all divisions must be so motivated as to maximise the profit of the company and not merely of division itself. Most large organisations adopt divisionalised structures. The manner in which divisional performance is controlled and measured is, therefore, of particular importance. In this paper, an attempt made to introduce divisional performance analysis; briefly discuss divisional performance measures; analyse the performance of five segments at Shree Renuka Sugars Ltd. over a period of last five year and communicate the results to readers thereof.