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ACCA Applied Skills · Performance Management · Performance analysis

Which of the following is the most significant criticism of the balanced scorecard as a performance measurement tool?

A key criticism is that the balanced scorecard can generate too many measures, leading to information overload and unclear priorities when measures conflict. It does not ignore non-financial indicators, is usable in not-for-profit bodies, and aims to balance short-term and long-term performance.

  1. AIt ignores non-financial performance indicators entirely
  2. BIt cannot be applied to not-for-profit organisations
  3. CIt focuses only on short-term financial results
  4. DIt may produce too many measures, causing information overload and unclear prioritiesCorrect

Explanation

A common criticism is that scorecards can contain many measures, which may conflict and make it hard to prioritise or to calculate an overall performance result. It includes non-financial measures by design, can be used by not-for-profit bodies, and balances short- and long-term goals.

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