Day: July 30, 2024

Alex plc is a large group listed in the UK, with a head office in London and strategic business units (SBUs) spread across the world.

Only overall strategy, research and development and consolidated financial reporting is done in London.

All SBUs manage their own marketing and operations, and report directly to the regional centres across the world for all other forms of functional support.

Alex Insurance is an SBU operating in France and reporting to the Alex Northern European regional centre, based in Belgium.

Alex Insurance is engaged in providing home and car insurance direct to French consumers.

Which of the following areas of functional support would be provided to Alex Insurance by the Alex Northern European regional centre?

Select ONE answer:

1. Sales management
2. Financial reporting for the London Stock Exchange
3. Periodic management accounts
4. Research and development

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct –> Periodic management accounts would be provided by the Regional Office as they are neither marketing/operations, nor are they related to strategic direction, R&D or consolidated financial reporting.
4. Not correct

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