Performance Measure Congruity and Diversity in Multi-Task Principal外文书.pdf

Performance Measure Congruity and Diversity in Multi-Task Principal/Agent Relations Author(s): Gerald A. Feltham and Jim Xie Reviewed work(s): Source: The Accounting Review, Vol. 69, No. 3 (Jul., 1994), pp. 429-453 Published by: American Accounting Association Stable URL: /stable/248233 . Accessed: 26/09/2012 20:47 Your use of the JSTOR archive indicates your acceptance of the Terms Conditions of Use, available at . /page/info/about/policies/terms.jsp . JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@. . American Accounting Association is collaborating with JSTOR to digitize, preserve and extend access to The Accounting Review. The Accounting Review Vol. 69, No. 3 July 1994 pp. 429-453 Performance Measure Congruity and Diversity in Multi-Task Principal/Agent Relations Gerald A. Feltham University of British Columbia Jim Xie University of Alberta SYNOPSIS AND INTRODUCTION: Accounting numbers are frequently used in evaluating management performance, and performance evaluation is an important ingredient in motivating managers. Three significant factors generally create difficul- ties in developing performance measures for a given manager. First, the actions and strategies implemented by the manager are not observable directly, so the manager cannot be compensated directly for his input into the firm. Second, the full conse- quences of the managers actions are not observable, in large part because the impact of those actions extend beyond his subunit of the firm and beyond his time as managerof that subunit. Third, uncontrollable events influence the consequences that are observed. The agency theory literature has explored extensively the implications of the nonobserva