I’m pretty exhausted from being up for almost 22 hours yesterday. Six of those were spent writing everything I had learnt in the last four months. They’re called exams.
A major chunk of the financial accounting exam was on justifying certain business decisions, or making suggestions to the CEO as his financial advisor. One of those questions I found really interesting:
You are the CEO of a mid-sized company. It’s typical to tie senior manager’s compensation with the performance of their respective divisions. Would you base the compensation based on the cash flow from operations, or on the net income? Give the pros and cons of each method.