Final answer:
Responsibility accounting underscores the importance of controllability in managerial roles, ensuring accountability within a decentralized organization. It is designed to make clear what managers are accountable for and helps in reducing transaction costs by providing clear areas of responsibility.
Step-by-step explanation:
Responsibility accounting emphasizes controllability within an organization. This approach to accounting focuses on the ability of managers to control certain aspects of the business, making sure that they are held accountable for their areas of responsibility. Unlike systems that attempt to assign blame, responsibility accounting is geared towards ensuring each manager knows what they are held accountable for, aligning with clear expectations set out by superiors and the organizational reporting structure.
A key element of this approach is the focus on controllability, meaning managers are evaluated based on the aspects they have the power to manage and change. It is understood that some factors are outside a manager's control; thus, in those cases, they are not held responsible. The idea behind responsibility accounting is that it fosters a sense of ownership and is used to aid in coordination and decision-making within a decentralized organization where information and decision-making are dispersed.
By delineating specific areas of responsibility, transaction costs associated with making decisions can be reduced, as each manager has clarity on what they are expected to control. This can lead to efficient organizational behavior and a clearer understanding for all members of the organization regarding who is accountable for which outcomes, supporting the overall goals and strategies of the company.