System of performance indicators in cecofis. presentation

Financial

The specification of objectives A better distribution of costs according to the corresponding activities and programs The development of performance indicators to evaluate the achievement of the previously identified objectives

The COSO report (Sponsoring Organizations of the Treadway Commission)

It is about materializing a fundamental objective: defining a new conceptual framework of Internal Control, capable of integrating the various definitions and concepts that had been used on this subject, thus achieving that at the level of public or private organizations, external auditing or internal or from academic to legislative levels, there is a common conceptual framework, with an integrating vision that satisfies the generalized demands of all the sectors involved.

system-of-performance-indicators-in-cecofis-1

Res 297 \ 03 raises the concepts of Internal Control, its correspondence with the current particular conditions of our economy, the content of its components and its application rules.

It is well stated that each entity must prepare its schedules, procedure manuals, performance indicator system and any other tool that facilitates the consequent application of the aforementioned resolution.

Every entity must assume:

Performance measurement methods Reliable, clear and precise information A system of indicators in correspondence with the characteristics, mission and functions of the organization

The indicators must be necessary and sufficient, since many indicators could bring confusion and ambiguity and few indicators could leave out key objectives, actions, areas and sectors for the entity's performance.

Quantitative indicators Qualitative indicators

Verification Guide in the section on Control Activities, subsection XII on Performance Indicators, the need to:

Check the existence of a system of performance indicators that provides feedback to the entity's management regarding the progress of corrective actions that reduce or eliminate significant variations in plans and goals.

INDICATOR

It is a quantitative and / or qualitative measure associated with the performance (effectiveness and efficiency) of an organization.

The information used for the development of these indicators includes both elements of the organization's strategic plan (objectives) and constitutive elements of the same that include inputs (resources), processes and products (goods or services).

(Carter 1992).

Performance indicators are instruments whose purpose is to measure the efficiency and effectiveness of an entity with the final purpose of developing strategies that favor the fulfillment and performance of functions, processes and procedures, within a system, as well as the fulfillment of the organizational goals and objectives.

This instrument should provide systematic and reliable information

ADVANTAGE

Helps determine the level of achievement of the organization's goals and objectives Provides performance information to both managers and clients Encourages an increase in the company's commitment to its customers Allows managers to free up decision-making on operational details Allows dedication More time for decision-making in the strategic field Improves the decision-making process It allows a more effective use of resources It allows to implement solutions that generate more effective results

Errors detected:

They are not representative of some areas, which can be very important They are ambiguous, they are too general, they do not allow an objective evaluation They focus on the short term, and they do not take into account the long-term effects so it is difficult to quantify the benefits at the end of a given period Most of the work is done on indicators that are common to a set of entities without taking into account those processes that are particularly representative of the entity and that generate a set of particular indicators Excessively rigid, inflexible performance indicators Lack of objectivity, no the Real State of the entity is taken into account when identifying the indicators, it falls into the game of assuming behaviors and results from past periods, such as current performance

EFFECTIVE IMPLEMENTATION OF PERFORMANCE INDICATORS

Create a team in charge of the design and / or implementation Create awareness about the need to evaluate the performance of the organization Ensure the support and commitment of senior management Ensure the commitment of staff, in the design and implementation of indicators