Assume that you are part of the top-management team of a large, diversified company. You are aware of the incentives that divisional and lower-Ievel managers have to pre-select projects and provide biased estimates, but the company policy is still to evaluate these managers on a short-term accruals income basis.

Give reasoned arguments for and against each of the following separate suggestions:

(a) To create the additional head office position of a capital budget 'supremo' whose remit is to monitor and check each project before ultimate authorization.

(b) To issue a policy that all capital project proposals that are generated should be evaluated by the divisional accountants and the results sent to the chief accountant at head office.

(c) To create a head office based team who are automatically called in by divisional managers to give advice at the cash flow estimation stage.

(d) To issue a policy statement that all capital projects will be considered on their merits regardless of their evaluation under the company's DCF criterion.