Responsibility Accounting

This comprises summarizing the information for each responsibility center. "Responsibility center" refers to the division of an enterprise into segments, lines of production, regional offices, etc. For example, fertilizers and petroleum products within the diversity of the business group as a whole; or the project complex near city X vs. the project complex near city Y vs. regional offices of the same organisation, and so on. Thus, accounts are prepared not only for the organisation as a whole but also for its segments. A form of budgeting is the subject of this approach. Three elements are reported in this form; both periodically and on 

completion of a distinct piece of work. These are 

1. budgeted or planned performance, 
2. actual performance, and 
3. differences between the budgets and actual performances.