Managerial Accounting
Managerial Accounting
17th Edition
ISBN: 9781260247787
Author: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Publisher: RENT MCG
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Chapter 11, Problem 1Q
To determine

Decentralization

It refers to the process of delegating authority and tasks to lower levels of management instead of being accumulated at the middle or top-level management.

Meaning of the term Decentralization.

Expert Solution & Answer
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Answer to Problem 1Q

Solution:

Decentralization is the process of disbursing authority and tasks to those who are at lower levels in the organizational hierarchy.

Explanation of Solution

  • Decentralization takes care of this problem by ensuring delegation of work to those at middle and lower levels of management and making them accountable for the same. This can result in efficient utilization of resources, pooling of mental faculties of people at the same level, and also acts as an incentive to perform better.
  • Decentralization refers to the process of delegation of the authority and responsibilities from a central point to lower levels in the organizational structure. In an organization this can be seen in the form of corporate responsibilities and authority being given to the middle and lower level management.
  • Decentralization is also practiced in other fields such as political science, economics, team dynamics in personal and professional situations
Conclusion

Hence it can be seen that the process of delegation of the authority and responsibilities from a central point to lower levels in the organizational structure is Decentralization.

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