What is Responsibility Accounting

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Responsibility accounting is based on the notion that managers should be held responsible for those (and only those) cost/revenue items that the manager can control to a significant extent.

However, while some costs may be uncontrollable, a manager may still be able to mitigate the incurrence of the cost through appropriate actions.
From a control point of view, someone in the organization must “take ownership” for each budget item or else no one will be responsible.

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