Essence, importance and accounting and information support of the controlling process

Abstract

The essence of controlling was studied and it was established that in the modern conditions of the development of information technologies, this concept tends to be treated as «leadership, regulation, management», which is due to the new concept of management, caused by the modern management implementation. It is explained that controlling integrates the processes of collecting, processing, and analyzing information on the company’s activities and, accordingly, is a source of information for making management decisions in a strategic and tactical plan. Four main goals of controlling are identified: informing; predicting; diagnostics; recording and reporting. It has been established that the importance of controlling in the enterprise’s activities is specified by the following features: achievement of goals (it is controlling that ensures the proper implementation of various measures in accordance with plans); revision of standards (an effective control system ensures accurate setting of standards); ensuring effective use of resources (an effective controlling system ensures minimal loss of resources); better motivation (thanks to controlling, employees know what they are expected to perform and how their work will be evaluated); maintenance of order (controlling helps to closely monitor the activities and behavior of employees); ensuring coordination (with proper monitoring, the efforts of different departments can be combined to achieve common goals and objectives of the enterprise). Disadvantages of controlling in the company’s activities are specified: difficulties in establishing quantitative standards (effectiveness of the controlling system is less efficient if the standards cannot be determined in quantitative terms); insufficient control over external factors (the enterprise cannot control external factors, such as government policy, technological changes, competition, etc.); opposition of employees (employees perceive controlling as a limitation of their freedom); an expensive business (controlling requires a lot of money, time and effort). It is established that controlling is usually focused on the accounting information system of the business entity to support management decisions. Thus, the quality of the accounting system affects the quality of management decisions as a result of the controlling process. Therefore, it is important to have access to reliable accounting information for proper and accurate decision-making, profit maximization and optimal use of limited resources.