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ASSOCIATION OF ACCOUNTING TECHNICIANS OF SRI LANKA

LEVEL II EXAMINATION - JANUARY 2021
(204) BUSINESS MANAGEMENT
21-03-2021
• Instructions to candidates (Please Read Carefully):
Afternoon
(1) Time Allowed: Reading : 15 minutes. [01.45 – 05.00]
Writing : 03 hours. No. of Pages : 06
No. of Questions : 07
(2) All questions should be answered.
(3) Answers should be in one language, in the medium applied for, in the booklets provided.
(4) State clearly assumptions made by you, if any.
(5) Action Verb Check List with definitions is attached. Each question will begin with an action verb
excluding OTQ’s. Candidates should answer the questions based on the definition of the verb given
in the Action Verb Check List.
(6) 100 Marks.

SECTION A
Objective Test Questions (OTQs)
(Total 25 marks)

Question 01

Select the most correct answer for question No. 1.1 to 1.5. Write the number of the selected answer
in your answer booklet with the number assigned to the question.

1.1 The main functions of the management process are:

(1) Planning, Unity of Command, Motivation and Leading.

(2) Planning, Organizing, Leading and Controlling.
(3) Planning, Decision Making, Communication and Leading.
(4) Planning, Effectiveness, Efficiency and Productivity.

1.2 Which one of the following is not a principle of planning?

(1) Principle of flexibility. (2) Principle of team work.

(3) Principle of influence. (4) Principle of complexity.

1.3 A support activity of the Porter’s Value Chain is:

(1) Operations. (2) Firm infrastructure.

(3) Inbound logistics. (4) Services.
1.4 Which one of the following is an internal determinant of rewards?

(1) Labour market conditions. (2) Worth of a job.

(3) Cost of living. (4) Government’s policy.

1.5 Consider the following:

(a) Work from home.

(b) Employees’ outsourcing.
(c) Work life balance.

Of the above, the correct innovation/s in Human Resource Management is/are:

(1) (a) only. (2) (a) and (b) only.

(3) (a) and (c) only. (4) All of the above.
(02 marks each, 10 marks)

Select the correct word/words from those given within brackets to fill in the blanks of question
No. 1.6 to 1.10. Write the selected word/words in your answer booklet with the number assigned to
the question.

1.6 Organizational culture can be identified as one of the …………………… (internal / external)
factors that influence the organizational strategy.

1.7 …………………… (Authority / Responsibility) flows from top to bottom.

1.8 …………………… (Growth / Recognition) of an employee is an example for esteem need of

Hierarchy of Needs theory.

1.9 …………………… (Selection / Induction) is the process of introducing and familiarizing new
employees to the organization.

1.10 …………………… (Educational qualification / Main duties to be performed) is an element of

Job Description (JD). (01 mark each, 05 marks)

Write answers for question Nos. 1.11 to 1.15 in your answer booklet with the number assigned to
the question.

1.11 List two(02) advantages of group decision making.

1.12 List two(02) elements of supply chain management.

1.13 State two(02) objectives of Human Resource Management (HRM).

1.14 State two(02) causes for grievances of employees of an organization.

1.15 State two(02) characteristics of Business Process Re-engineering (BPR).

(02 marks each, 10 marks)
(Total 25marks)
End of Section A
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 SECTION B
(Total 50 marks)

Question 02

The business environment is highly volatile and every business organization has to face changes
in the dynamic environment. Hence managers need to be innovative in their thinking in order to
face the challenges. Management thinking has continued to change in line with the social,
cultural, political and economic changes that have been taking place in the business environment
over the years.

You are required to:

(a) State three(03) characteristics of Bureaucratic Management Theory. (03 marks)

(b) Explain three(03) skills required by a manager. (03 marks)

(c) Explain two(02) new trends in management emerged due to COVID-19 global pandemic.
(04 marks)
(Total 10 marks)

Question 03

The production manager of XYZ Ltd., had argued that planning is useless, because all the plans
that they have developed did not achieve the expected results in the past few years. The CEO of
XYZ Ltd. advised at the management meeting that all the plans should be developed in a realistic
way by analysing all the relevant factors and suggested that decision making also should be more
rational.

You are required to:

(a) State the steps of the rational decision making process. (03 marks)

(b) Explain three(03) reasons as to why planning is important for an organization. (05 marks)

(c) State two(02) possible reasons for the failure of plans developed by the Production
Manager of XYZ Ltd. (02 marks)
(Total 10 marks)

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 Question 04
Operations Management is an important function of the organization and it helps to continue the
day to day activities of the organization effectively and efficiently. To run the business operations
smoothly, authority is required to be delegated properly.

You are required to:

(a) Identify four(04) key functions of Operations Management. (02 marks)

(b) State two(02) new technologies used in Operations Management in today’s context.
(02 marks)
(c) Explain three(03) advantages of delegation of authority. (06 marks)
(Total 10 marks)

Question 05
New health guidelines issued by the government to control COVID-19 pandemic have created
new set of controls inside organizations. This leads managers to use different communication
methods to inform their staff about these controls. But some employees of most of the
organizations do not adhere to these guidelines because those guidelines have not been
effectively communicated to staff by the respective organization.

You are required to:

(a) List two(02) benefits that can be obtained by effective communication for an organization.
(02 marks)

(b) State the main steps in a process of controlling. (04 marks)

(c) Explain two(02) factors to be considered in controlling by an organization due to new

health guidelines. (04 marks)
(Total 10 marks)

Question 06

Marketing plays a key role in an organization. Success or the failure of an organization might
depend on the quality of marketing techniques it uses. Therefore, organizations must properly
handle its marketing activities in developing the organizational strategies. Most of the
organizations give more prominent for their “branding” as a main marketing activity.

You are required to:

(a) State the four(04) variables of marketing mix (4Ps). (02 marks)

(b) State two(02) requirements of a successful brand. (02 marks)

(c) Explain three(03) reasons as to why branding is important for a business organization.
(06 marks)
(Total 10 marks)
End of Section B
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 SECTION C
(Total 25 marks)

Question 07

Susantha is a pottery businessman who inherited his business from his father. He has managed
to grow his traditional business to a certain level of success. He is the only person who involves
in all marketing activities which are done using his personal connections. Now he is planning to
establish an online platform for his business. But Susantha’s father has not agreed with
Susantha regarding using the advanced technology for their business.

Susantha has taken initiatives to introduce a strategic plan to the business and his strategy is to
make this business more focused on the “Made to Order” business. E-commerce and social media
platforms are some of the new initiatives which Susantha is planning to introduce.

Changes which were planned by Susantha, have a high impact on daily wage workers due to the
risk of loosing their jobs. Further, some of the senior employees who are committed at work are
unhappy with these changes. Susantha is planning to recruit skilled employees for their
business to cater the new demand as the Sri Lankan government has also taken initiatives to
promote traditional businesses in Sri Lanka.

As employees resist to change, Susantha decided to conduct a workshop targeting all the staff to
inform regarding the new changes and why those changes are required.

You are required to:

(a) Explain three(03) ways by which digital marketing could be used for Susantha’s business.
(06 marks)

(b) Explain using the PESTEL analysis, how the environment analysis could be considered by
Susantha when developing a strategic plan for his business. (08 marks)

(c) Identify four(04) strategies to overcome human resource surplus. (04 marks)

(d) Explain two(02) ways that Susantha can use to overcome resistance to change. (04 marks)

(e) State three(03) characteristics of a successful modern leader. (03 marks)

(Total 25 marks)

End of Section C

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 ACTION VERBS CHECK LIST
Level of
Description Action Verbs Verb Definitions
Competency
Draw Produce a picture or diagram.
Relate Establish logical or causal connections.
Recall Facts
Knowledge (1)
and Basic State Express details definitely or clearly.
Concepts.
Identify Recognize, establish or select after consideration.
List Write the connected items.

Level of
Description Action Verbs Verb Definitions
Competency
Show validity or otherwise, using knowledge or
Recognize
contextual experience.
Explain &
Comprehension Elucidates Interpret Translate into understandable or familiar terms.
(2) Ideas and Describe Write and communicate the key features.
Information.
Explain Make a clear description in detail using relevant facts.
Define Give the exact nature, scope or meaning.

Level of
Description Action Verbs Verb Definitions
Competency
Reconcile Make consistent / compatible with another.
Graph Represent by graphs.
Assess Determine the value, nature, ability or quality.
Use and Adapt
Application (3) Solve Find solutions through calculations and/or explanation.
Knowledge in
New Prepare Make or get ready for a particular purpose.
Situations.
Demonstrate Prove or exhibit with examples.
Calculate Ascertain or reckon with mathematical computation.
Apply Put to practical use.

Level of
Description Action Verbs Verb Definitions
Competency
Communicate Share or exchange information.
Outline Make a summary of significant features.
Draw
Contrast Examine to show differences.
Analysis (4) Connections
Among Ideas Compare Examine to discover similarities.
and Solve
Problems. Discuss Examine in detail by arguments.
Differentiate Constitute a difference that distinguishes something.
Analyze Examine in details to find the solution or outcome.

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