A Limitation of Using Industry Norms in Financial Performance Evaluation

question 148

True/False

A limitation of using industry norms in financial performance evaluation is that some companies in the same industry may not be strictly comparable.

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Definitions:

Merit Pay Plans

Compensation strategies that reward employees based on their performance, skills, or achievements, rather than seniority or job title alone.

Ineffective Systems

Structures or processes within an organization that fail to achieve the desired outcome or efficiency.

Merit Pay Plans

Compensation strategies that provide financial rewards to employees based on their performance achievements, aiming to motivate and retain talent.

Conventional Merit Pay

A traditional form of compensation where employees are rewarded based on their performance and achievements, typically evaluated through annual reviews.