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Control costs



Introductiontocostcontrol

Afterthecompany’splansaredetermined,variousdepartmentsandunitsneedtoworktogetherandcooperatewitheachothertocompletethetasksdeterminedbytheplan.Inordertoachievethisgoal,themanagementauthoritiesneedtoformulatevariousbudgetindicatorsandstandardcosts,andbydecomposingandimplementingthesebudgetindicatorsandstandardcosts,alldepartmentsandtasksareincludedinthebudgetsystem,soastoencouragealldepartmentstoimprovetheirworkefficiency.Atthesametime,comparingtheactualcompletionoftheworkersineachdepartmentwiththebudgetindicatorsandstandardcostscanidentifyexistingproblemsandcorrectthemintimetoensuretherealizationofthegoals.Inthecontrolphase,accountantsmustnotonlyparticipateintheformulationofbudgetindicatorsandstandardcosts,butalsotakeadvantageofthecostinformationtheyhavetocontroltheentireprocessofproductionandoperationactivities.Thecoreofthecontrolcostappliedbymanagementaccountingisbudgetcostandstandardcost.

Costcontrolisanimportantpartofcostmanagement.IntheearlydaysofthefoundingofthePeople'sRepublicofChina,machineryindustryenterprisesgenerallyimplementedaccountingsystemstocalculateproductioncostsandcalculateproductcosts.Thisbelongstocostmanagementafterthefact.Sincethefirstfive-yearplan,planmanagementandquotamanagementhavebeenimplemented,andthecostcalculationquotamethodhasbeentriedout,sothatcostmanagementhasevolvedfromsimplecostaccountingtocostforecasting,costdecision-making,costplanning,costcontrol,costaccountingandcostanalysis,Sothattheexpost"calculationcost"becomestheexante"costmanagement".Inordertostrengthencostmanagement,itisnecessarytodothebasicworkofcostmanagementsuchasquotawork,originalrecordingwork,measurementwork,materialreceivingandreturningwork,internalplannedpricework,etc.;itisrequiredtodecomposecostindicators,implementcostindicatorscentralizedandhierarchicalmanagement,andmakeclearDividethescopeofresponsibilityandpower,andformulateacostmanagementsystemtoformacostmanagementguaranteesystemandaresponsibilitysystem;requiretheimplementationofcomprehensivecostmanagement,thatis,fullprocesscostmanagementandfullcostmanagement.

Maincontent

Thecontentofcostcontrolisveryextensive,butthisdoesnotmeanthatpowerisusedevenlyineverydetail.Costcontrolshouldbetreateddifferentlyinaplannedandfocusedmanner.Differentcompaniesinvariousindustrieshavedifferentcontrolpriorities.Thecontentofcontrolcangenerallybeconsideredfromthetwoperspectivesofthecostformationprocessandtheclassificationofcostsandexpenses.

Dividedaccordingtothecostformationprocess

1.Controlbeforetheproductisputintoproduction

Thispartofthecontrolcontentmainlyincludes:productdesigncost,Processingcost,materialpurchasecost,productionorganizationmethod,materialquotaandlaborquotalevel,etc.Thesecontentshavethegreatestimpactonthecost.Itcanbesaidthat60%ofthetotalproductcostdependsonthequalityofthecostcontrolworkatthisstage.Thiscontrolworkbelongstothepre-controlmethod.Therealcosthasnotyetoccurredwhenthecontrolactivityisimplemented,butitdetermineshowthecostwilloccur,anditbasicallydeterminesthecostleveloftheproduct.

2.Controlinthemanufacturingprocess

Themanufacturingprocessisthemainstageofactualcostformation.Mostofthecostexpendituresareincurredhere,includingtheconsumptionofrawmaterials,labor,energyandpower,variousauxiliarymaterials,inter-processmaterialtransportationcosts,workshopsandothermanagementdepartmentexpenses.Whetherthevariousplanideasandcontrolmeasuresofthecontrolbeforeproductioncanbeimplementedinthemanufacturingprocess,andwhethermostofthecontrolobjectivescanbeachievedarecloselyrelatedtothecontrolactivitiesatthisstage.Itismainlyaconstantcontrolmethod.Sinceitisdifficulttoachievetimelyaccountinginformationforcostcontrol,itwillbringmanydifficultiestocontrolintheevent.

3.Controlduringthecirculationprocess

Includingproductpackaging,transportationoutsidethefactory,advertisingandpromotion,salesagencyexpensesandafter-salesserviceexpenses.Inthecurrentemphasisonstrengtheningthecorporatemarketmanagementfunction,itiseasytoadoptvariouspromotionalmethodsregardlessofthecost,buttooffsettheprofitincrease,soaquantitativeanalysisshouldbemade.

Accordingtothecompositionofcostexpenses

1.Rawmaterialcostcontrol

Inthemanufacturingindustry,rawmaterialexpensesaccountforthetotalcostofAlargeproportion,generallyabove60%,upto90%,isthemainobjectofcostcontrol.Thefactorsthataffectthecostofrawmaterialsincludeprocurement,inventorycosts,productionconsumption,recycling,etc.,socontrolactivitiescanstartfromthethreelinksofprocurement,inventorymanagement,andconsumption.

2,SalaryExpensesControl

Salaryoccupiesacertainproportionofthecost,increasingWagesareagainconsideredirreversible.Controllingthesimultaneousgrowthofwagesandbenefitsandreducingtheproportionofwagesinunitproductsisofgreatsignificanceforreducingcosts.Thekeytocontrollingwagecostsistoimprovelaborproductivity,whichisrelatedtofactorssuchaslaborquotas,workinghoursconsumption,workinghoursutilization,workefficiency,andworkerattendancerates.

3,ManufacturingcostsControl

Manufacturingcostsaremanyitems,mainlyincludingdepreciation,Repaircosts,auxiliaryproductioncosts,workshopmanagementstaffwages,etc.,althoughitaccountsforasmallproportionofthecost,butbecauseitisnotnoticeable,thephenomenonofwasteisverycommon,anditisacontentthatcannotbeignored.

4,EnterprisemanagementfeeControl

EnterprisemanagementfeereferstomanagementandorganizationofproductionThevariousexpensesincurredandtheexpenditureitemsareverymany,whicharealsothecontentthatcannotbeignoredincostcontrol.Alloftheaboveareabsolutecontrols,thatis,variouscostsandexpendituresarecontrolledundertheassumptionofafixedoutput.Intherealsystem,thegoalofcontrollingtheunitcostoffinishedproductsmustbeachieved.

Implementation

Costcontrolmustrelyonscientificandstrictmanagement.

Controllingcostsisalong-termcontinuousprocess.Ifyouwanttomaintainasustainedcostadvantage,youmustrelyonscientificandstrictbasicmanagementtosupportit.

Costcontrolisbasedonpre-determinedcosts(plannedcosts,fixedcostsorstandardcosts),andstrictlycontrolsthematerialconsumption,laborconsumptionandotherexpensesincurredintheproductionandsaleofacertainnumberofproductsManagementandsupervisiontoachievethepurposeofreducingcostsandimprovingeconomicefficiency.Thecostcontrolworkrunsthroughtheentireprocessofproductionandoperation,startingfromtheproductdesignstage.Accordingtotheprincipleofcombiningtechnologyandeconomy,thetargetcostmanagementisimplemented,andthetechnicaldesignandeconomicmanagementdepartmentsarejointlyresponsibletoensurethatthetrialproductionofnewproductsandthemodificationofoldproductsaretechnologicallyadvanced,competitiveinthemarket,andeconomicallyItisreasonable.

Costcontrolfirstdeterminesadvancedandreasonablecostcontrolstandards.Thecostcontrolstandardisthequantitylimitstipulatedforvariousexpensesandconsumptionofvariousresources.Itincludesrawmaterialconsumptionquota,workinghoursquota,expensequota,etc.Intheprocessofcostformation,theactualsituationofthecostshouldbecomparedwiththecostcontrolstandard,andthedeviationsfoundshouldbecorrectedintimetomakethecostandconsumptionoccurwithinthecostcontrolstandard.

Intheprocessofproductionandoperation,alltypesofpersonnelareresponsibleforthecostcontrolsystem.Onthepremiseofimprovingproductoutputandquality,theworkersintheteamcontroltheconsumptionofrawmaterials,tools,workinghours,etc.onthebasisofquotas,continuouslyimprovelaborproductivityandequipmentutilization,andreduceandsaverawmaterialconsumption;techniciansdiscusstherelationshipbetweenproductfunctionsandcostsTherelationshipbetweenproductionandmanagementpersonnel,andstrivetoachieveproductfunctionstandardsatthelowestcost;productionmanagementpersonnelcoordinateandorganizebalancedproduction,improveproductionefficiencyandreducetheoccupationofproductionfunds;managementpersonnelcontrolmaterialprocurementcostsandreservecapitaloccupation,managementfeesandsalesfees,etc.expenditure.

Formodernenterprises,astrictandstandardizedsystemisthemostpowerfultoolforintegratingcorporateresourcesandachievingcorporategoals.Thisisourdeepexperienceintheconstructionofthecorporatesystem.Weconcentratedoureffortsontwoaspectsofwork.First,inordertosolvethetwocoreissuesofimprovingworkingstandardsandimprovingworkingprocedures,thecompanyhasfullyimplementedtheISO9000qualitysystemcertificationworkwithinthecompany,andimplementedtheoverallstrategicthinkingandfunctionalstrategyofthecompanyintothespecificationsandprocessesofthecompany'sproductionandoperationactivities.Thesecondistostrengthenthecompany'ssupervisionandinspectionmechanism,establishanexpertmanagementcommittee,supervisetheimplementationofvarioussystems,andensuretheimplementationandcontinuousimprovementofvariousrulesandregulations.Soastoestablishtheinstitutionalbasisforcostcontrol,andtheimprovementmechanismofthesystemitselfthatiscompatiblewithcostcontrol.

Continuousandrigorouscostcontrolabilitycomesfromtheaccumulationandutilizationofexperience,andmusthaveadvancedmanagementtoolstoadapttoit.Tothisend,wehaveestablishedanenterprisemanagementinformationsystemtoprovideapowerfultechnicalplatformfordeepeningbasicmanagement.Sixsubsystemsincludingofficeautomation,equipmentmanagement,real-timeproduction,financialmanagement,integratedquery,andinternalwebsitehavebeencompletedandputintouse,andfoursubsystemsofoperationmanagement,fuelmanagement,projectmanagementandcomprehensivebudgetmanagementareabouttobedevelopedandconstructed.TheconstructionoftheMISsystemhasbroughtadvancedmanagementthinking,andthecompany'svariousworkprocesseshavebeenoptimized,providingabroaderwayofthinkingforadvancingthecompany'slow-coststrategy.

Method

Strengtheningandimprovingtheinternalcontrolofcostsandexpensesisanimportanttaskforenterprises.HowtomakeenterpriseschangethestatusquoofinternalcontrolofcostsandexpensesandgetridofthedilemmaofhighcostsandexpensesWhat?Itshouldstartfromthefollowingaspects:

Comprehensivemanagement

Theproportionofenterpriseindirectcostsinthetotalcostisincreasing.Theenterprisemustobtainproductcostadvantagesandobtaineconomicbenefitsatthesametime.,Itshouldnotonlybelimitedtothecontrolofmanufacturingcosts,butshouldalsobeextendedtotheentireproductlifecyclecost.Suchasdesignresearchanddevelopmentcosts,equipmentoperationandmaintenancecosts,materialprocurementcostsandinventorystoragecosts,etc.,aswellasvariousperiodexpensesincurredbythecompanytoorganizeandmanageproductionandoperationactivities.Ontheotherhand,thescopeshouldnotbelimitedtotheproductionfield,butshouldbeextendedtotheresearchanddevelopment,procurementandsalesfields.

Pre-implementationcontrol

Thekeytocostcontrolistoformulateandestablishatargetcostindexsystem.Thetargetcostindexneedstobecalculatedmanytimestoselectthebestplanfromthetargetprofit.Theindexformulationprocessshouldbebasedonthemarket,basedonmarketinformation,marketconditions,thepricecomparisonofvariousproductsonthemarket,demandtrends,theresourcestatusoftheenterprise,theusevalueoftheproductandthemeasurementoffunctions,andcalculatetheoptimalsalesofcompetitiveproducts.Then,throughproductsalesmarketsurveys,thetargetsalesrevenueforthecurrentperiodisestimatedbysalesandproduction,andpriorityisgiventodeductingnationaltaxesandpredictiveanalysisofrelevanteconomicinformationtodeterminethetargetprofitofproductsales.Basedontheformula:productunittargetcost=productunitsalesprice-productunittargetprofit,thetargetcostindexoftheenterpriseisdrawnup.Butthisisnotthefinaltargetcostindicator.Financialpersonnelshouldalsoconductcalculations,analysis,andcomparisonsbasedonthecompany’sproductioncapacity,technicallevel,equipmentlevel,materialsupplychannels,pricelevelandotherspecificconditionswiththecooperationofrelevantpersonnel.Thecostobtaineddoesnotreachtheplannedtargetcostandneedstobeadjustedorreset.

Avoidinvalidcosts

Inordertoachievethetargetcostsandimplementtheresponsibilitysystem,companiesshouldavoidinvalidcostsasmuchaspossible.

First,enterprisesshouldstrengthentheirsupervisoryfunctions,andsettechnical"supervision"tobeinchargeofprocess,qualityinspectionandotherdepartments,economic"supervision"byfinanceandauditingdepartments,anddisciplinary"supervision"Itiscompletedbydisciplineinspection,supervisionandotherdepartments,eachresponsibleforitsownduties,withacleardivisionoflabor.

Second,strengthenmaterialmanagement,regularlyorganizerelevantpersonneltoinspectandrectifythematerialmanagementandwarehousestorageineachworkshop,andcombineregularinventoryandirregularrandominspectionstoachievecertification,accounting,andmaterialinspections.Correspondingly,avoidthelossofmaterials.Atthesametime,itsupervisestheuseofmaterials,implementsaquotarequisitionsystem,andreturnstheremainingmaterialstothewarehouseintimetopreventloss,damage,ordamage.Themanagementofspecialmaterialsshouldbeheldaccountabletoothers,soastoavoidmisappropriatingthemforotherpurposesandcausingwaste.

Thirdly,thedepreciationcausedbyidlewasteofresourcesandproductbacklogisalsooneofthemainfactorsofhighcost.Themodernmanagementsystemofenterprisesshouldcreateconditionsformakingfulluseofresourcesandrationallyplaninventory.

(1)Idlematerialsofenterprisesflowintheformofvaluequantitytorealizeassetappreciation.Throughacomprehensiveandsystematicinventorycheck,materialadjustment,checkoutandpurchaserestrictionmeasuresareformulated,somematerialsthatarenotneededareprocessed,andidleassetsarerevitalized.Doeverythingpossibletomakeuseoftheredundantandlow-utilizationfixedassetsintheenterprise,includingfactorybuildings,land,andequipment.

(2)Enterpriseshavetherighttoincreaseordecreasepersonnelandfixedassetsaccordingtoproductionneeds,andimplementreasonableallocationofpersonnelandequipment.Firstplantheidealhuman-machineratiorelationship,andthendesignandrealizethereasonableconfigurationoftheexistinghuman-machinebyanalyzingthetechnicalleveloftheexistingpersonnelandtheexistingtechnicalequipmentleveltopreventthepersonnelorthemachinefrombeingidle.

(3)Takingtheformof"zeroinventory"astheguidingideologyofinventorymanagement,accordingtothemethodoforderingproductionbysalesandorderingbyproduction,rationallyarrangetheinventorytoachievethebestandavoidunnecessaryWarehousemanagementcostsandpossibleaccidentallosses.

Basicprocedures

Thecostcontrolintheproductionprocessistostrictlysupervisethevariousfactorsofcostformationintheproductmanufacturingprocessinaccordancewiththepre-drawnstandards,andfinddeviationsTaketimelymeasurestocorrectthem,sothattheconsumptionofvariousresourcesandexpensesintheproductionprocessarelimitedtothescopespecifiedbythestandard.Thebasicworkingproceduresofcostcontrolareasfollows:

Developcoststandards

Thecoststandardsaretheyardsticksofcostcontrol.Thecoststandardsfirstincludethevariousindicatorsspecifiedinthecostplan.However,someindicatorsinthecostplanarerelativelycomprehensiveandcannotmeettherequirementsofspecificcontrol.Therefore,aseriesofspecificstandardsmustbestipulated.Thereareroughlythreemethodsfordeterminingthesestandards:

(1)Planindexdecompositionmethod.Thatistobreakdownlargeindicatorsintosmallindicators.Whendecomposing,itcanbedecomposedbydepartmentandunit,orbydifferentproductsandtheprocessstagesorpartsofvariousproducts.Ifitismoredetailed,itcanalsobedecomposedbyprocess.

(2)BudgetLaw.Itistoformulatecontrolstandardsbyformulatingbudgets.Somecompaniesbasicallyformulatearelativelyshort-term(suchasmonthly)expensebudgetbasedonquarterlyproductionandsalesplans,anduseitasacostcontrolstandard.Withthismethod,specialattentionshouldbepaidtoformulatingbudgetsbasedonactualconditions.

(3)Quotamethod.Itistoestablishquotasandexpenditurelimits,andusethesequotasandlimitsascontrolstandardstocontrol.Inenterprises,whereverquotascanbeestablished,quotasshouldbeestablished,suchasmaterialconsumptionquotas,workinghoursquotas,andsoon.Themethodofimplementingquotacontrolisconducivetothespecificityandregularizationofcostcontrol.

Whenusingtheabovemethodstodeterminethecostcontrolstandards,sufficientinvestigationsandscientificcalculationsmustbecarriedout.Atthesametime,itisnecessarytocorrectlyhandletherelationshipbetweencostindicatorsandothertechnicalandeconomicindicators(suchastherelationshipwithquality,productionefficiency,etc.),startingfromthecompletionoftheoverallgoaloftheenterprise,throughacomprehensivebalance,andpreventingone-sidedness.whennecessary.Itshouldalsoengageintheselectionanduseofavarietyofprograms.

Monitoringtheformationofcost

Thisistocheck,compareandsuperviseeachprojectofcostformationaccordingtothecontrolstandard.Itisnotonlynecessarytochecktheimplementationoftheindicatorsthemselves,butalsotoinspectandsupervisethevariousconditionsthataffecttheindicators,suchasequipment,craftsmanship,tools,technicallevelofworkers,andworkingenvironment.Therefore,dailycostcontrolmustbecombinedwithproductionoperationcontrol.

Themainaspectsofdailycostcontrolare:

(1)Dailycontrolofmaterialcosts.Workshopconstructorsandtechnicalinspectorsshallsupervisetheoperationsinaccordancewiththerequirementsofdrawings,techniques,andtooling,andimplementfirst-pieceinspectionstopreventbatchscraps.Workshopequipmentpersonnelmustsupervisethemaintenanceanduseofequipmentinaccordancewiththerequirementsoftheprocessregulations,andcannotstartproductioniftheydonotmeettherequirements.Thematerialstaffofthesupplydepartmentshallimplementquotadistributionaccordingtothespecifiedvarieties,specifications,andmaterials,andsupervisetheimplementationofthesystemssuchasmaterialrequisition,replenishment,andreturn.Productiondispatchersmustcontrolproductionbatches,cutmaterialsreasonably,feedmaterialsreasonably,andsupervisetheimplementationoftheperiodquantitystandard.Thedailycontroloftheworkshopmaterialcostisgenerallytheresponsibilityoftheworkshopmaterialaccountant.Itmustcollectmaterialsfrequently,analyzeandcompare,tracethereasons,andproposeimprovementmeasuresinconjunctionwithrelevantdepartmentsandpersonnel.

(2)Dailycontrolofsalaryexpenses.Mainlyitisthesupervisionandcontrolofthework-hourquota,attendancerate,work-hourutilizationrate,labororganizationadjustment,bonuses,allowances,etc.oftheworkshopemployeesontheproductionsite.Inaddition,theproductiondispatchermustsupervisethereasonablearrangementoftheinternaloperationplanoftheworkshop,andmustreasonablyputintoproduction,dispatchworkersreasonably,controlidlework,stopwork,workovertime,andworkovertime.Theworkshopemployees(orquotastaff)areresponsibleforthecontrolandaccountingoftheabove-mentionedrelatedindicators,analyzethedeviations,andfindthereasons.

(3)Dailycontrolofindirectcosts.Therearemanyprojectsforworkshopexpensesandenterprisemanagementexpenses,andtheoccurrencesaredifferent.Ifthereisafixedamount,itiscontrolledbyafixedamount.Ifthereisnofixedamount,itiscontrolledaccordingtovariousexpensebudgets.Forexample,itiscontrolledintheformofanexpensemanual,anenterpriseexpensecertificate(alsocalledapromissorynote,anenterprisecirculationcertificate),etc.Relevantpersonnelareresponsibleforthecontrolandsupervisionofvariousdepartments,workshops,andteams,andputforwardsuggestionsforimprovement.

Thedailycontroloftheabove-mentionedproductioncostsshouldnotonlyhavespecialpersonnelresponsibleandsupervise,butalsomaketheexecutorswhoincurthecostsexerciseself-control.Itshouldalsobestipulatedintheaccountabilitysystem.Onlyinthiswaycantheenthusiasmofallemployeesbemobilized,sothatthedailycostcontrolhasamassbasis.

Correctthedeviationintime

Accordingtothereasonofthecostdifference,identifytheresponsibleperson,distinguishthesituation,andputthepriorityontheimprovementmeasures,andimplementthem.Forthecorrectionofmajordifferences,thefollowingproceduresaregenerallyadopted:

(1)Proposeissues.Fromvariouscausesofcostoverruns,thetopicofcostreductionisproposed.Thesetopicsshouldfirstbethoseprojectsthathavegreatpotentialforcostreduction,areconcernedbyallparties,andmaybeimplemented.Putforwardtherequirementsofthesubject,includingthepurpose,content,reasons,basisandexpectedeconomicbenefitsofthesubject.

(2)Discussionanddecision-making.Afterthetopicisselected,relevantdepartmentsandpersonnelshouldbemobilizedtoconductextensiveresearchanddiscussion.Formajorissues,itmaybenecessarytoproposeavarietyofsolutions,andthenconductacomparativeanalysisofthevarioussolutions,andselectthebestsolutionfromthem.

(3)Determinethemethodstepsfortheimplementationoftheplanandthedepartmentsandpersonnelresponsibleforimplementation.

(4)Implementthedeterminedplan.Intheimplementationprocess,timelysupervisionandinspectionshouldalsobecarriedout.Aftertheplanisrealized,itisnecessarytochecktheeconomicbenefitsaftertheplanisrealized,andmeasurewhethertheexpectedgoalisachieved.

Basicprinciples

Theprincipleoffullintervention

Theprincipleoffullinterventionreferstothecontrolofall,allemployees,andtheentireprocessofcostcontrol.Allistocontroltheentirecostofproductproduction,notonlythevariablecost,butalsothefixedcost.Theoverallcontrolistomobilizeleadingcadres,managementpersonnel,engineeringandtechnicalpersonnelandthemajorityofemployeestoestablishcostawareness,participateincostcontrol,andrealizetheimportanceofcostcontrolbeforetheycantakeaction.Wholeprocesscontrol,tocontrolthedesign,manufacturing,andsalesprocessoftheproduct,andtoreflectthecontrolresultsontherelevantreports,soastofindshortcomingsandproblems.

Theprincipleofmanagementbyexception

Costcontrolshouldfocusonuncommonsituations.Becausetheactualexpensesareoftenupanddownwiththebudget,ifthedifferenceisnotbig,thereisnoneedtofindoutthereasonsonebyone,butjustfocusontheabnormalexceptionsandprovidetimelyinformationfeedback.

Principlesofeconomicbenefits

Improveeconomicbenefitsnotonlybyreducingtheabsolutenumberofcosts,butmoreimportantly,achievingrelativesavingsandachievingthebesteconomicbenefitswithlessTheconsumptionofmoreandmoreresults.

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