Final Examinations

Module E
The Institute of 8 June 2016
Chartered Accountants 3 hours 100 marks
of Pakistan Additional reading time 15 minutes

Business Management
Q.1 Platinum Limited (PL) is planning to set up a business as internet service providers. PL has
carried out a market survey which shows that the internet services provided by the existing
firms are rated as unsatisfactory by a significant number of customers. PL has therefore
plans to target customers who are willing to pay premium rates in return for the highly
efficient services.

Explain briefly the factors which would enable PL to adopt quality as a strategic variable
and offer superior services to its customers. (06)

Q.2 Established in the year 2006 in Karachi, Good Food Restaurants (GFR) has achieved
remarkable growth and presently owns and operates a chain of ten restaurants in Karachi,
Lahore and Islamabad. GFRs operations have been highly profitable because it has a
significant base of loyal customers who are not only a source of repeat business but they also
promote its image through word-of-mouth advertisement.

Identify the strengths, weaknesses, opportunities and threats for GFR. (Mention any four
points in respect of each)

Note: Only list the parameters explanations are not required. (08)

Q.3 What is meant by the term distribution/marketing channel? Describe briefly the different
matters which a manufacturer must take into consideration while selecting/designing a
distribution/marketing channel for marketing of its products. (10)

Q.4 In the present rapidly changing and highly competitive environment, strategic management
has become an extremely challenging task for business leaders.

Explain the key factors/actions, which in your opinion are important for ensuring that the
functions of strategic planning and management are performed in a coordinated manner to
achieve the pre-determined goals set in the strategic plans. (09)

Q.5 Ahmed Limited follows a policy of periodically introducing employee incentive schemes to
motivate the employees and ensure high levels of performance.

Describe briefly the considerations which management must keep in perspective for
successful implementation of employment incentive schemes. (06)

Q.6 Meridian Limited has recently been incorporated for establishing large manufacturing
facilities in three major cities with plans to induct 15,000 employees of diverse skills in
various cadres.

As Director of Human Resources, identify six types of human resource professional staff
that you would hire for performing specific human resource activities on sound professional
lines and briefly describe their particular roles. (06)
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Q.7 Identify the types of expansion/integration strategies pursued by the companies in the
following scenarios:
(a) ABC Limited, a manufacturer of a wide range of confectionary products has merged
with XYZ Confectioners. It is envisaged that the proposed merger would offer
significant economies of scale and further consolidate its competitive advantages. (01)
(b) Coolair Fan Company, a Gujranwala-based manufacturer of ceiling fans presently
markets its products in Punjab and KPK. The company has decided to promote its
products in Sindh and Baluchistan and has appointed distributors for marketing its
products in these two provinces. (01)
(c) Superior Sugar Mills Limited has developed its own plantations for growing sugar
cane to ensure steady supply of good quality sugar cane. (01)
(d) Climax Pipes Limited, a manufacturer of PVC pipes has established facilities for
manufacture of auto rickshaws. (01)
(e) Household Appliances Company a manufacturer of home appliances has sold the
division for manufacture of vacuum cleaning machines because it involved wholly
different manufacturing competencies and marketing efforts which did not blend well
with the companys overall strategies. (01)

Q.8 (a) What do you understand by the term competency-based reward system? (02)

(b) As the Director Human Resource of a recently established listed company, what types
of managerial competencies would you seek while hiring managers for your company? (08)

Q.9 (a) Global companies are stateless corporations who view the whole world as a single
market. State any five important strategic and leadership attributes of global
companies. (05)

(b) State the advantages an MNC would seek to achieve by pursuing a highly
decentralised strategy in the management of its overseas business operations. (04)

(c) State four reasons why MNCs prefer to enter into international collaboration
arrangements with companies in foreign countries. (04)

Q.10 (a) Explain briefly the purpose of each of the following types of recruitment tests which
are administered to candidates in the selection process.
(i) Intelligence Tests
(ii) Proficiency Tests
(iii) Aptitude Tests
(iv) Psychometric tests (06)

(b) Identify three different steps which a firm may take subsequent to the successful
interview and prior to the issuance of appointment letter to a candidate. (02)

Q.11 Astute marketers pursue different strategic approaches depending on the type of their
orientations towards the customers or competitors.

(a) Briefly explain the difference between customer oriented and competitor oriented
market approaches with one practical example of each. (03)

(b) List four characteristics which, in your opinion, would determine the direction of
marketing strategies in each of the above types of marketing orientations. (06)
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Q.12 Write short notes on the following:

(a) Concept of Business Ethics and reason for its increasing importance (03)
(b) Market research and why it is conducted (04)
(c) Steps involved in the process of decision making (03)

(THE END)