Relationship between planning and controlling

Correct answer: A. Controlling compares with standards and standards come from planning

Planning and controlling are interdependent functions of management. During planning, management sets objectives, action programmes, schedules, and standards of performance. During controlling, actual performance is measured and compared with those predetermined standards; deviations are identified and corrective action is taken. Therefore option A correctly explains the relationship. Controlling cannot be complete without a planned benchmark, so B is false. Planning normally precedes implementation and control, making C incorrect. D is also false because control obtains its reference point from plans, while control feedback can help improve future planning. Both functions support each other.

Correct answer: A. Setting a budget target and comparing it with actual expenditure

The governing concept is that planning establishes objectives and standards, while controlling measures actual performance against those planned standards and takes corrective action when necessary. In option A, the budget is prepared during planning, and the actual expenditure is later compared with the budgeted amount. If the actual spending is higher or lower than the target, the manager can calculate the deviation, identify its cause and correct future spending. Options B and D lack a planned standard, so meaningful comparison is impossible. Option C is an administrative record, not an example of the planning-control relationship. Therefore, A is the only complete and unambiguous example.

Correct answer: A. Comparison will be based on wrong standards

Option A is correct because planning and controlling are closely interrelated. Planning establishes objectives, expected results, time limits and the standards against which actual performance will later be assessed. If the plan is unrealistic, incomplete or based on incorrect assumptions, the resulting standards may also be unsuitable. Controlling would then compare performance with an improper benchmark, so the reported deviations and corrective decisions could be misleading. The other options do not follow from faulty planning: employee capability does not automatically improve, authority relationships are mainly an organising issue, and motivation does not automatically rise. Therefore incorrect planning can weaken the accuracy and usefulness of controlling.

Correct answer: A. By providing learning from deviations and their causes

Option A is correct because controlling provides feedback for future planning. After actual performance is measured and compared with planned standards, managers can identify deviations and investigate their causes. They may discover that a target was unrealistic, resources were insufficient, assumptions changed or a particular method worked well. This evidence helps them revise objectives, forecasts, schedules, budgets and strategies for the next planning cycle. Controlling therefore does not merely find faults; it creates learning and improves managerial decisions. Closing the organisation, automatically dismissing employees or eliminating goals is neither a normal purpose nor a necessary result of control. Feedback from control makes future plans more realistic and effective.

Correct answer: A. Forecasting becomes a basis of planning

Forecasting and planning are closely related but are not identical activities. Forecasting studies available information and estimates likely future conditions, such as demand, prices, resources, or competition. Planning uses those estimates to establish objectives and decide actions, schedules, methods, and resources. Hence option A is correct: forecasting provides an informed basis for planning and reduces uncertainty, although it cannot guarantee that every prediction will be accurate. Option B is the opposite of the relationship. Option C is wrong because forecasting is also used before planning, and option D ignores its important preparatory role.