Business, Legal & Accounting Glossary
Accountability is the obligation to give an account. For limited companies, it’s assumed that the company directors are accountable to its shareholders and that this responsibility is discharged, in part, by the directors’ provision of an annual report and accounts.
In any accountability relationship, there will always be at least one principal and at least one agent.
Accountability is an entity’s obligation to be accountable for its actions. Ideally, accountability also entails reporting one’s actions to stakeholders on all material issues on a reasonable basis. The concept can also imply that there will be consequences if an entity fails to meet its obligations.
A company’s managers must be held accountable for the performance of its operations. This means that if the owners are dissatisfied with the organization’s performance, they can replace the managers.
responsibility, liability, accountable, responsible, responsibilities
Accountability is the act of being held responsible for the results obtained after performing a given activity. It is a situation where what is being delivered is reviewed and evaluated.
In a business context, accountability is essential to keep work relationships transparent and productive. It basically means that an employee’s activities should be reviewed from time to time to provide some feedback to him, so he can work more effectively. Accountability also aims to avoid negligence and wrongdoings in the workplace. Employees should be held accountable for what they do, to the extent that they were conscious of what they were doing.
An employee’s accountability is closely related to their work duties. An employee can be held accountable for anything they do within the parameters of what they were hired for.
That means a company can’t hold an individual accountable for doing something they were not supposed to be doing. Accountability becomes more important for senior management staff since the impact of their decisions is higher. This means that top executive activities should be more thoroughly reviewed in order to avoid misconduct and undesired consequences from wrong decisions.
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This glossary post was last updated: 13th April, 2022 | 0 Views.