This case is designed for the introductory MBA course management accounting or MBA course in planning management and control systems. It provides the impact (1) the basic assumptions in the creation of an operational plan, (2) an analysis of the differences in the actual and projected financial results, including the development of flexible expenditure budgets, quantitative earnings impact of various business risks that affect earnings, and preparing a comprehensive reconciliation of actual and planned profit, and (3) thinking through some of the major issues related to the implementation of assessment of functional managers. CEO of Bellaire Clinical Labs, Inc, has just completed its initial review of the 1998 results of the CFO of the company. In comparison, in 1998 the actual results from 1998 operational plan, CEO expressed concern, because income was much higher than expected, but the higher income did not increase profits. Financial officer asking for an investigation. "Hide
by Luann J. Lynch, Richard Brownlee Source: Darden School of Business 5 pages. Publication Date: February 10, 2000. Prod. #: UV4034-PDF-ENG
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