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ACCA Applied Skills · Performance Management · Specific performance analysis issues in not-for-profit organisations and the public sector

Which of the following is a recognised difficulty in controlling the performance of a not-for-profit organisation, compared with a profit-seeking company?

Multiple, non-financial objectives that are hard to prioritise make NFP control difficult. Unlike a company, there is no single profit measure, outputs are hard to value in money, and many stakeholders have differing expectations of the organisation.

  1. AObjectives are often multiple, non-financial and hard to prioritiseCorrect
  2. BProfit is always available as a single measure of success
  3. COutputs are always easy to measure in monetary terms
  4. DThere are no external stakeholders to satisfy

Explanation

NFP organisations commonly have several non-financial objectives that may conflict, so no single measure like profit exists. The other options are the opposite of the real position: profit is not the main aim, outputs are hard to value, and stakeholders are many.

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