ACCA Applied Knowledge · Business and Technology · The purpose and types of business organisation
A government-owned agency provides subsidised public transport. Its board states that its primary aim is to deliver an affordable and reliable service to citizens rather than to maximise profit. Which type of organisational objective does this best describe?
The aim of delivering an affordable and reliable public service is a non-financial or service objective. Public sector bodies exist to benefit citizens, not to maximise profit or shareholder wealth, so profit-based objectives do not describe this agency's primary purpose.
- AA profit-maximisation objective
- BA non-financial (service) objectiveCorrect
- CA shareholder wealth objective
- DA short-term liquidity objective
Explanation
Public sector bodies typically exist to provide services and value for money rather than to generate profit for owners. An affordable, reliable service is a non-financial objective. Profit maximisation and shareholder wealth are private sector, owner-focused objectives, so they do not fit.
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