Straightening the tortuous - and treacherous - ROI path

Article Abstract:

Return on investment (ROI) is a commonly used measure of financial performance. Because ROI is based on accounting income and book values - which can be manipulated by different accounting methods - rather than on the true rate of return, ROI can often give a distorted view of financial performance. ROI analyses or improvements can be especially harmful if managers manipulate short-term income to look good, at the expense of long-term performance. Examples and calculations are provided which show how ROI can be misused, and how it can lead to poor investments. Strategies for preventing the misuse of ROI data are also identified and discussed.

Return on investment, Capital assets pricing model, Capital asset pricing model, Rate of return

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Controlling the costs of decentralized information systems

Article Abstract:

The decentralization of data processing has created problems with cost allocation and computing management. Data processing has become separated into information centers, data processing centers, and end-users' departments. Successful management of decentralized computing services involves: increasing planning flexibility; assigning overall planning to higher levels of management; and assigning comprehensive charges to responsible users in terms they understand.

Management information systems, Information resources management, Data processing, Electronic data processing

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Controlling service center costs

Article Abstract:

Controlling service center costs involves controlling costs within the service department and controlling the use of the service within the organization. Two factors that affect cost control are the control that the users have over the consumption of services, and the availability of external services to substitute for internally provided ones.

Services industry, Service industries, Cost accounting

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