Sennapods plc is contemplating an organizational restructuring.

At present, the company is organized functionally, as follows:

Sennapods plc has 3 main product ranges, health foods, medications for the National Health Service and agricultural fertilizers. In terms of profitability, each of these product ranges is performing equally well and the growth prospects for each are equally optimistic.

Required:

(a) Extend the existing functional organization to accommodate the product ranges. What problems of control loss may emerge?

(b) Devise an alternative multidivisional structure for Sennapods plc. Indicate the possible advantages and dis advantages of this structure.

(c) Under the multidivisional structure, provide justified arguments for a change in the management accounting performance measurement system highlighting the differences with the system likely to be used under the functionally organized structure.

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