Formation of the cost of production at the enterprise. Theory of Activity Based Costing Various approaches to calculating the cost of production

The Activity Based Costing (or ABC) method has become widespread in European and American enterprises. Literally, this method means activity cost accounting (functional cost accounting).

It arose as a result of changes in the economic structure of costs, in particular, the views on the methodology of cost accounting and calculation of the cost of production have changed, since traditional production costing systems were created at a time when most companies produced a limited range of products and mainly in production costs included the cost of basic materials, labor costs of key production workers. The costs of production maintenance and management, which are mostly overhead, were small, so the distortion of production costs due to their distribution in proportion to the wages of production or the amount of material costs for products was insignificant. The cost of information processing, on the contrary, was quite high.

The search for new methods for obtaining objective information about costs has led to the emergence of the ABC method, or "AB-costing", according to which the enterprise is considered as a set of work operations that determine its specifics. In the process of work, resources (materials, information, equipment) are consumed, some result appears. Accordingly, the initial stage of applying the AB-costing method is the determination of the list and sequence of work in the enterprise by decomposing complex work operations into simple components in parallel with the calculation of resource consumption.

The considered costing system is a new direction for domestic accounting, and the approach to costing by type of activity is due to the awareness of the inadequacy of reflection by traditional methods of cost allocation of modern complex production processes. Calculation by type of activity is especially relevant for organizations providing educational services. The ABC method is one of the directions for the distribution of overhead (indirect) costs. The application of the AB-costing method provides for a slightly different terminology than in the domestic accounting system. one)

A cost allocation group is a detailed group of indirect costs that can be identified with specific activities.

For example, the salary of a safety engineer is 28,800 rubles. per month. During this period, he performs four types of work: briefing - 100 hours, checking the preparation of workplaces - 14 hours, drawing up a report - 8 hours, dismantling emergency situations - 22 hours. A total of 144 hours of work. Indirect costs, or cost distribution group, are salaries with accruals. 2)

An operation is an event, task, or unit of work that has a specific purpose. ABC uses the cost of these operations as an intermediate step for attributing the costs of products (works, services) and as information that has independent value. In our example, the operation is briefing 100 hours, checking the preparation of workplaces - 14 hours, etc. 3)

Operation Center - a group of operations united by some technological or organizational feature.

Operations centers can be activities related to the operation of equipment, its current repair, etc. After the inclusion of operations in the accounting system, the resources consumed by each individual operation (center of operations) during the reporting period are established. In our example, the operations center equals operations.

The degree of detail (grouping) in each case depends both on the specifics of the technology and the organization of production and management, and on the presence of technical, informational, time and other restrictions. The test of effectiveness will be decisive, i.e. the benefit of detailing information, as in any other system of calculation, must exceed the cost of it. four)

A cost driver, or cost allocation base, is the link between a group of overhead costs and an operation. For example, the costs associated with the work of a safety engineer can be related to the performance of the scope of duties through the amount of time spent on types of work. 5)

The rate of the cost carrier, or the distribution coefficient of the first stage - the ratio of the group of distributed costs to the value of the cost carrier. If we continue the previous example, then the distribution coefficient of the first stage will be equal to the ratio of the costs associated with the work of a safety engineer to the total amount of time worked by him, i.e. 144 hours. The distribution coefficient is 200 * 28,800 rubles: 144 hours = = 200 rubles. 6)

The cost of the operation is the total amount of expenses aimed at the implementation of homogeneous operations. In the part of the salary of the safety engineer, it will be equal to the distribution factor of the first stage, multiplied by the value of the distribution base related to this operation.

In our example, the cost of the instruction operation is equal to

200 rub. 100 hours \u003d 20 LLC rubles;

the cost of preparing jobs -

200 rub. 14 hours = 2800 rubles;

the cost of dismantling emergency situations -

200 rub. 22 hours = 4400 rubles;

cost of reporting

200 rub. 8 hours = 1600 rubles 7)

The carrier of an operation, or the cost allocation base of an operation, is a quantitative measure of the workload of an operation. In our example, the carrier of the operation is expressed by the number of briefings - 40 units. and the preparation of seven jobs.

The rate of the carrier of the operation, called "preparation of jobs" (or coefficient), will be:

K2 = = 400 rubles. eight)

The rate of the carrier of the operation, or the distribution coefficient of the second stage - the ratio of the cost of the operation for the period to the total value of the carrier of the operation for the same period. In this case, the specific indicator of the cost of the briefings carried out is calculated. The coefficient will be:

K, \u003d -- \u003d 500 rubles.

The ABC system provides for a two-stage distribution of costs and, accordingly, there are two calculation objects - intermediate - operation; final - production. Let's say that the products (lamps) are made by 20 workers. The share of the salary of a safety engineer attributable to the production of fixtures is equal to the cost of the operation performed (500 rubles) multiplied by the quantitative expression of the distribution base (20 people). In our example, the cost per month for the briefing operation performed by the safety engineer and related directly to the manufacture of fixtures is 10,000 rubles, or

500 rub. 20 people = 10,000 rubles.

The cost of the operation "preparation of three jobs assigned to the production of lamps" will be:

400 rub. 3 work places = 1200 rubles.

Examining the activities of the organization, Ronald Coase (Nobel laureate in economics) concluded that the effectiveness of work depends on the ratio of costs for similar business operations within the company and in the free market. If the costs of an operation inside the enterprise are less than those outside it, it makes sense to keep the staff in the structure, to invest resources within the enterprise. If the need for the work of individual specialists is small, it is more profitable to pay for an external service. Simply put, the economics of transaction costs allows you to understand why firms are created and why their management is based on a particular organizational structure.

The ABC method is used in combination with methods of cost accounting and costing of products of different levels. In Russia, it is still only being used. Abroad, in the management of firms, information is used that is obtained by applying the AB-costing method for current management and strategic decisions.

In many organizations, the ABC method is considered not as an accounting method, but as a management tool. Cost management in the context of individual operations, not products or even cost centers provides new opportunities for effective planning and cost control and reduction.

It is generally accepted that ABC information can be used both for current management and for making strategic decisions. At the level of tactical management, this information can be used to determine ways to increase profits and improve the efficiency of the organization, at the strategic level - in making decisions regarding the reorganization of the enterprise, changing the range of products and services, entering new markets, diversifying, etc.

The application of the ABC method is also known in inventory management. This method classifies stocks according to some specific indicator of importance, usually according to the annual volume of use of this type of stock: raw materials, materials, semi-finished products in monetary terms. Depending on the importance of stocks and the size of working capital used for their acquisition, activities for control and management of stocks are distributed among managers.

The ABC method is used to improve the performance of enterprises in various fields of activity. One of its main uses is in the service industry, where the manager focuses on the most important aspects of service, dividing them into the most important, important, and not so important. The point is not to overvalue the non-essential aspects of service at the expense of the really important ones.

The ABC accounting system has the following advantages:

provides a more accurate calculation of the unit cost of production in the case of a significant share of indirect costs that are not directly related to the objects of calculation;

substantiates managerial decisions on pricing, the choice of a production program;

provides the calculation of the cost of business processes, especially when performing services as new costing objects.

So, with the ABC method, unlike the traditional method, the cost accounting object is the operation, and the calculation object is the operation and the usual object: a product or a group of products, a service or a group of services, work performed (Fig. 8.1).

Let's consider a schematic diagram of the distribution of indirect costs, i.e. the cost of maintaining a safety engineer for the operations performed and the allocation of costs to certain types of products (Fig. 8.2).

Using the ABC method, not all costs are distributed, but only those for which it is possible and economically feasible to isolate cost groups by operations and find adequate drivers of costs and operations. The remaining indirect costs are allocated using the traditional method.

The allocation of overhead costs can be complex and even controversial, but overhead costs are an important cost element for many organizations, and their treatment has a significant impact on unit cost results, inventory costs, profit estimates, and possibly sales prices.

In the practice of management accounting, two approaches to the distribution of overhead costs are possible: "traditional" and by type of activity (ABC method). The procedures used by each of these approaches are shown in Fig. 8.3.

Traditional method ABC method

Rice. 8.3. Traditional and ABC method of allocation of overhead costs 232

Allocation (and redistribution) bases should be determined, if possible, in terms of the overhead cost carrier, i.e. underlying cause of their occurrence.

An ideal basis for the implementation of the AB-costing system is scientific and educational activities. Based on this method, it is possible with a high degree of reliability to assess the quality of education, the level of programs and instrumental systems used, and the timeliness of the technologies used in the field of educational services.

Activity Based Costing or ABC Method, widely used in European and American enterprises of various profiles.

In the literal sense, this method means "accounting for costs by work", i.e. functional cost accounting.

In Activity Based Costing, an enterprise is viewed as a set of work activities. The initial stage of applying ABC is to determine the list and sequence of work in the enterprise, which is usually carried out by decomposing complex work operations into their simplest components, in parallel with the calculation of their resource consumption. Within the framework of the ABC, three types of work are distinguished according to the way they participate in the production of products: Unit Level (piece work), Batch Level (batch work) and Product Level (product work). Such a classification of costs (works) in ABC systems is based on the experimental observation of the relationship between the behavior of costs and various production events: the release of a unit of production, the release of an order (package), the production of a product as such. At the same time, another important category of costs is omitted, which does not depend on production events - costs that ensure the functioning of the enterprise as a whole. To account for such costs, a fourth type of work is introduced - Facility Level (general business work). The first three categories of work, or rather, the costs of them, can be directly attributed to a specific product. The results of general economic work cannot be accurately assigned to one or another product, therefore, various algorithms have to be proposed for their distribution.

Accordingly, in order to achieve an optimal analysis, resources are also classified in the ABC: they are divided into those supplied at the time of consumption and supplied in advance. The former include piecework wages: workers are paid for the number of work operations that they have already completed; the second - a fixed salary, which is negotiated in advance and is not tied to a specific number of tasks. This division of resources makes it possible to organize a simple system for periodic reports on costs and income, solving both financial and managerial tasks.

All resources spent on a work operation constitute its cost. At the end of the first stage of the analysis, all the work of the enterprise must be accurately correlated with the resources necessary for their implementation. In some cases, the cost item clearly corresponds to some kind of work.

However, a simple calculation of the cost of certain works is not enough to calculate the cost of the final product. According to ABC, the work operation must have an index-measurement of the output result - the cost driver. For example, the cost driver for the “Supply” cost item will be “Number of purchases.

The second stage of application of the ABC is to calculate the cost drivers and indicators of their consumption of each resource. This consumption figure is multiplied by the cost per unit output of the work. As a result, we get the amount of consumption of a particular work by a particular product. The sum of consumption by a product of all works is its cost price. These calculations constitute the 3rd stage of the practical application of the ABC methodology.

I note that the presentation of an enterprise as a set of work operations opens up wide opportunities for improving its functioning, allowing for a qualitative assessment of activities in such areas as investment, personal accounting, personnel management, etc.

Corporate strategy implies a set of goals that an organization wants to achieve. The goals of the organization are achieved by the performance of its work. Building a work model, determining their relationships and execution conditions provide a reconfiguration of the business process of the enterprise to implement the corporate strategy. ABC, ultimately, increases the competitiveness of the enterprise, providing accessible and operational information to managers at all levels of the organization.

An even greater effect in cost optimization can be achieved by using ABC in combination with another technique, namely - concept of life cycle cost accounting (Life cyclecosting-LCC).

This approach was first applied in the framework of government projects in the defense industry. The cost of the entire life cycle of a product, from design to retirement, was the most important indicator for government agencies, since the project was funded based on the full cost of the contract or program, and not on the cost of a particular product. New production technologies have provoked the transfer of LCC methods to the private sector. There are three main reasons for this transition: a sharp reduction in the life cycle of products; increase in the cost of preparation and launch into production; almost complete definition of financial indicators (costs and incomes) at the design stage.

Technological advances have shortened the life cycle of many products. For example, in computer technology, the time of production of products has become comparable to the time of development. The high technical complexity of the product leads to the fact that up to 90% of production costs are determined precisely at the R&D stage. The most important principle of the concept of life cycle costing (LCC), thus, can be defined as "forecasting and managing the costs of manufacturing a product at the design stage".

Successful work in the conditions of global competition requires not only constant updating of the range and quality of products, but also a thorough analysis of the enterprise's activities to reduce unnecessary or duplicated functions (works). Often, an organization, in pursuit of cost reduction goals, adopts a policy of total cost reduction. Such a solution is the worst, since under such a policy, all work is subject to reduction, regardless of its usefulness. A general reduction can reduce the performance of essential work, which will lead to a deterioration in the overall quality and productivity of the enterprise. The drop in productivity, in turn, will lead to another wave of layoffs, which will once again reduce the efficiency of the organization. Attempts to get out of this vicious circle will force the company to raise costs above the initial level.

The ABC methodology allows the enterprise not only to reduce costs line by line, but to identify excess resource consumption and redistribute them in order to increase productivity.

Thus, this method has a number of advantages:

It allows you to analyze overheads in detail, which is of great importance for management accounting.

The ABC method makes it possible to more accurately determine the cost of unused capacity for periodic write-off to the profit and loss account. The unit cost estimated using this method is the best financial estimate of the resources consumed, as it takes into account complex alternative ways of determining the relationship between production and resource use.

The ABC method allows you to indirectly assess the level of labor productivity: a deviation from the amount of resources consumed, and therefore from the release or comparison of the actual level of cost sharing with the volume that could be possible with real resource provision.

The ABC method not only delivers new information about costs, but also generates a number of non-financial indicators, mainly measuring the volume of production and determining the production capacity of the enterprise.

Based on the foregoing, we note that introduction of the ABC system into the practice of Russian enterprises would provide a reliable calculation of the cost of specific products, which will significantly increase the objectivity of assessing the profitability of products. Ultimately, the use of ABC will increase the competitiveness of the enterprise, since it provides access to operational information at all levels.

Where is used: The Activity based costing (ABC) method was developed by American scientists R. Cooper and R. Kaplan in the late 80s and became widespread in the West. In Russia, the name of the method is often translated as functional cost analysis (FSA). Another option is a functional cost allocation system.

Key concepts:

• A cost object is any unit of account (department, contract, distribution channel, type of product, etc.) for which costs need to be determined separately.
• Cost driver - a parameter proportional to which costs are transferred to the cost of resources.
• Resource driver is a parameter proportional to which the cost of the resource is transferred to the cost of the operation.
• Activity driver is a parameter that proportionally transfers the cost of activities to cost objects.

Essence:
Activity Based Costing consists in cost accounting for work (functions). The enterprise is considered as a set of work operations, in the course of which it is necessary to expend resources.

The cost of indirect costs in the enterprise is transferred to resources in proportion to the selected cost drivers. Then the structure of operations necessary to create products (works, services) is developed. The calculated resource cost is then transferred to operations in proportion to the selected resource drivers. As a result, the cost of operations is included by cost objects in proportion to the drivers of operations. The result is the calculated cost of products, works or services.

The essence of the method is to study the relationship between costs and various production processes.

According to the methodology, a complete list and sequence of operations (functions) are determined with simultaneous calculation of the resource requirements for each operation.

There are 4 types of operations according to the way they participate in the production of products:

• piece work (output of a unit of production)
• batch work (issue of an order, set)
• product work (production as such)
• general business work

The first three types of transactions relate to costs that can be directly attributed to a particular product. General business costs cannot be accurately attributed, so they are distributed according to the developed algorithms.

Resources are classified by highlighting 2 groups:

1. delivered at the time of consumption (e.g. piecework wages)
2. delivered in advance (for example, salaries)

All resources spent on a work operation make up its cost, but a simple calculation of the cost for individual operations does not allow determining the cost of production. Therefore, the cost distribution index (cost driver) is also calculated.

Through the system of cost drivers, the amount of resources spent per product output is determined.

The disadvantage of the method is the high complexity of implementation. However, ABC is one of the most accurate ways to estimate costs.

In recent decades, a new direction in management accounting has been actively developing in foreign theory and practice, covering costing (activity-based costing) and budgeting (activity-based budgeting). These systems supplement the management system based on the process approach (ABM-management, activity based management) or are used for other purposes. The information generated by the costing system "AVS-costing" is intended for strategic management decisions in the field of pricing and selection of promising products for production, for reengineering of business processes, etc. It can also be used for operational management. In this case, the ABC methodology for allocating indirect costs is introduced into the traditional absorption costing system.

We can talk about the evolution of the ABC costing system, since invented at the beginning of the 20th century. and forgotten for a while, the accounting tool received a new incarnation and development in the 1980s. There is a discussion about the history of the development of the ABC, so this problem can be taken as the basis for NIRS. The question of the origin of the ABC is debatable: is it a new phenomenon or a methodology forgotten for a while, born earlier? Two points of view can be distinguished. Representatives of the first are unanimous regarding the time of the creation of the ABC (80s of the XX century), but do not quite agree on the recognition of the authorship of the new accounting technology. So, J. Innes, F. A. Mitchell, Ya. V. Sokolov are called the creator of the LAN R. Kaplan; O. E. Nikolaeva adds R. Cooper; in the Oxford Explanatory Dictionary, the appearance of the LAN is associated with the publication in 1987 of the book by T. Johnson and R. Kaplan "The Ups and Downs of Management Accounting". However, adherents of a different point of view believe that the foundations of the ABC costing system methodology were formed in 1923. G. J. M. Clark in his work "A Study in the Economics of Overhead Costs".

Causes of ABC. The main reasons for the spread of ABC in the practice of companies are due to the following:

• 1) the role of the "total cost" indicator in the strategic business management and with the solution of the problem of reducing its conventionality;
• 2) a steady upward trend in the share of indirect costs in the cost of production;
• 3) processes of diversification of commercial activities of economic entities;
• 4) the fact that the accounting methodology using a single base for the distribution of indirect costs increases the degree of conventionality of the "full cost" indicator, since it often makes it impossible to establish a causal relationship between products and the resources they consume.

The first reason for the spread of ABC is associated with an increase in the degree of uncertainty in the business environment, risks and competition. Under these conditions, strategic management has acquired particular importance, for which information on reduced costs becomes irrelevant, since fixed costs take on the character of variables over a long period of time.

The degree of conditionality depends on the share of indirect costs in the cost of production, therefore, the trend of increasing costs for maintenance of production and management determined the second reason for the development of ABC. The justification for this trend and examples of the cost structure are discussed in paragraph 3.2 when characterizing the classification group "direct and indirect costs".

Why did the increased diversification of activities affect the development of ABC? If at the beginning of the XX century. enterprises specialized in a particular product, the increased uncertainty of the external environment and risks led to the process of diversification of activities, resulting in a significantly expanded range of products. This reduces the ability to identify consumed resources directly with products and requires improved cost allocation methodology.

Reasons of a general nature would not be so significant for the further development of the methodology of calculation, if the accounting methods were adequate to the new tasks of enterprise management. However, the approach adopted in accounting to the distribution of indirect costs in proportion to one distribution base does not allow reflecting a causal relationship between all groups of distributed costs and the object of calculation. Moreover, in practice, the distribution base is chosen based not on the logic of a causal relationship, but on the basis of the convenience of obtaining ready-made information from accounting registers.

ABC is a complex and time-consuming costing system. And despite the needs of management, it would not have developed if it were not for the increased capabilities of information technology. The spread of ABC was ensured by a significant reduction in the cost of information processing due to the development of modern information systems.

The nature of ABC. One of the names of the ABC-costing system - two-stage costing - reflects an essential feature of ABC, associated with two steps in the distribution of indirect costs. The first step is the distribution of indirect costs among the operations of business processes, the second is the distribution but the final objects of calculation, for example, products. Here one of the fundamental differences between ABC costing and traditional costing systems appears, which is that the concept of "operation" is introduced into the accounting process, which is reflected in the name of the system - "activity-based costing", i.e. transaction costing. A business process activity is an event, task, or unit of work that has a specific purpose. ABC-costing uses the cost of these operations as an intermediate step for attributing costs to products (works, services) and as information of independent value.

The two-step procedure is a manifestation of one of the concepts underlying ABC costing. If, when using traditional costing systems, it is considered that resources are absorbed by products (Fig. 6.4, a), then in the ABC system, resources are absorbed by operations; then the cost of operations is absorbed by products (Fig. 6.4, b).

Rice. 6.4. The logic of the movement of costs in the traditional approach to costing (i) and in the ABC approach(b)

The ABC core vocabulary includes the following key terms:

• group of indirect costs;
• cost driver (otherwise cost carrier);
• intermediate costing object;
• final costing object.

The concept of "group of indirect costs" reflects the cost of the resources used (materials, etc.), which must be attributed to the objects of calculation, distributed in a certain way. This concept differs from the traditional interpretation of the "group of indirect costs" in that the ABC system distinguishes numerous groups of homogeneous indirectly distributed costs, in relation to which it is possible to find a cost driver that reflects a causal relationship between costs and calculation objects.

The key concept "cost driver" is similar to the familiar term "cost allocation base". From the point of view of the distribution technique, there are no differences - this is the amount in proportion to which indirect costs are distributed. From a concept standpoint, yes. The concept of "cost driver" refers to one of the provisions of the ABC concept: "indirect allocation procedures are carried out on the basis of identified causal relationships." Thus, the word "cost driver" means a causal relationship, a factor influencing the cost of the operation, then the final costing object. The term "base of distribution", due to its too general nature, has no such meaning, especially if we take into account the practice of many enterprises that use the wages of production workers as the basis of distribution.

The ABC costing procedure is described in paragraphs 4.2 and 7.2 in relation to solving specific problems.

Application practice. ABC-costing has a wide range of applications, including the rationale for decisions on assortment management, pricing, new product launches, customer base selection based on customer profitability, evaluation of responsibility centers, inventory evaluation. Information is used in budgeting, in reengineering of business processes.

Example 6.6 provides an overview of the practice of management accounting tasks solved on the basis of ABC; Example 6.7 shows the scope of the ABC approach to costing and control.

Example 6.6

The results of the review of the activities of companies using ABC-costing in their activities are given in Table. 6.11.

Table 6.11

Usage ABC costing companies

Example 6.7

The popularity of the use of ABC in various fields of activity is visible from a survey compiled on the basis of a survey of commercial companies and organizations (Table 6.12). It is noteworthy that industrial enterprises use the ABC approach less frequently than public organizations.

Table 6.12

Application ABC in various industries

In Russia, this approach to costing is beginning to gain popularity. For example, a frozen food business applied the ABC methodology to justify a strategic decision to outsource convenience foods; diversified enterprises, including those providing services in the field of IT - to determine the effectiveness of business processes and projects. However, there is no wide practice of applying this approach yet, while abroad it is used in companies.

ABC information can be used both for current management and for making strategic decisions. At the level of tactical management, this information can be used to form recommendations for increasing profits and improving the efficiency of the organization. On a strategic level, as assistance in making decisions regarding the reorganization of an enterprise, changing the range of products and services, entering new markets, diversifying, etc. ABC information shows how resources can be reallocated for maximum strategic benefit.

The logic of the ABC system consists in a more detailed structuring of cost groups, finding cause-and-effect relationships formalized in cost and operation drivers. The capabilities of modern information systems allow you to perform accounting procedures quite efficiently. Prospects for the development of the ABC costing system are related to its use for evaluating the activities of responsibility centers; and as an information basis for product and process development. The last provision requires the integration of the ABC methodology and functional cost analysis.

• Innes J., Mitchell F. A Practical guide to Activitv-Based Costing. L.: Kogan Page Ltd, 1989.
• Sokolov Ya. V., Sokolov V. Ya. History of accounting. M.: Finance and statistics, 2004.
• Nikolaeva O. E., Alekseeva O. AT. Strategic management accounting. M.: Editorial URSS, 2003.
• Johnson H. T., Kaplan R. Relevance Lost: The Rise and Fall of Management Accounting. Harvard: Harvard University Press, 1987.
• Shank J., Govindarajan V. Strategic cost management: Per. from English. St. Petersburg: Business Micro, 1999.
• The name of the costing system "activity-based costing" is translated by Russian researchers in different ways, for example, costing by type of activity, costing by operations, costing by functions, FSA, etc. Let us consider the applicability of these names based on the analysis of the essence of the activity-based costing method, and also the interpretation of the term “type of activity” that is customary for the domestic economy (the types of activity of a company are usually understood as, for example, the production of juices, building structures, etc.). The essence of the ABC method and its fundamental difference from other costing systems is not in the consolidation of accounting objects into types of activities, but in the fact that accounting objects are divided as much as possible into business process operations (naturally, taking into account the efficiency rule). Then the cost of these particles is synthesized either into the cost of production or into the cost of processes that were previously dissected. And these fractional components of the processes, which in turn consist of actions, become the objects of calculation.
• Managerial accounting 10th ed. South-Western Thomson Learning, 2003. P. 130.
• Louderback J.G., Holman J.S. Managerial accounting 10th ed. South-Western Thomson Learning, 2003. P. 130.

Cost accounting method by function, orABC method(from the English Activity Based Costing - ABC), in essence being an alternative to the order-based method of cost accounting and costing, it is effective for enterprises characterized by a high level of overhead costs.

Fundamental differenceABC method from other methods of cost accounting and costing is distribution of overhead costs.

The algorithm for its construction is as follows: 1) the organization's business is divided into main activities (functions, or operations). In particular, they can be: placing orders for the supply of materials; operation of the main technological and auxiliary equipment; operations for its readjustment; quality control of semi-finished and finished products, their transportation, etc. The number of activities depends on its complexity: the more complex the organization's business, the greater the number of functions will be allocated.

The overhead costs of the organization are identified with the identified activities;

2) each type of activity is assigned its own cost carrier, estimated in the appropriate units of measurement. In doing so, they are guided by two rules: the ease of obtaining data related to the cost carrier; the degree of compliance of cost measurements through the cost carrier with their actual value. For example, the processing of orders for the supply of materials can be measured by the number of orders placed; equipment changeover function - by the number of required changeovers, etc.;

3) the cost of a cost carrier unit is estimated by dividing the amount of overhead costs for each function (operation) by the quantitative value of the corresponding cost carrier;

4) the cost of production (work, services) is determined. To do this, the unit cost of the cost carrier is multiplied by their number for those types of activities (functions), the implementation of which is necessary for the manufacture of products (works, services).

In this way, cost accounting object with this method is a separate type of activity (function, operation), and object of calculation - type of products (works, services).

The order-to-order method, for the purposes of allocating overheads, takes into account the behavior of only one indicator, ignoring the influence of other factors on them (such as quality control and equipment changeover). Being faster and simpler, the order method can be used only when the influence of other factors on the organization's overhead costs is insignificant. Otherwise, the distortions are significant and the ABC method should be used. Using the ABC method allows you to make more effective decisions in the field of marketing strategy, product profitability, etc. Moreover, it becomes possible to control costs at the stage of their occurrence.

To effectively manage a business, company managers need to know:

1) what is the cost of individual services and their components (for example, the operations of receiving correspondence by a courier, tracking the movement of goods in the information system, issuing an invoice, etc.);

2) the provision of which services is more profitable;

3) which clients bring the company the minimum profit, which ones are unprofitable, etc.

This and other information can be obtained using the ABC method of cost accounting and costing. It allows you to understand how the services provided by the company, as well as the customers served by it, affect the volume of activities and how much different activities consume resources. This, in turn, contributes to the management of not so much the costs themselves as the activities that consume these funds.

The algorithm for constructing the ABC method is as follows:

Stage 1. Determination of the main and auxiliary activities of the company.

To main activities include operations directly related to customer service. The cost of carrying out the main activities is determined by the nature of the order being executed.

Under ancillary activities understand those areas that are not directly related to customers or products, but which provide the necessary conditions for the normal existence of the main activities (for example, the functioning of the HR department, the information support department, etc.).

Stage 2. Distribution of activities between departments.

Each department is assigned a code and the types of activities in which this or that department is involved are determined.

Stage 3. Selection of the distribution base for each cost item.

Using it, the costs are distributed among the activities of the company.

Thus, the wages of the company's personnel are distributed between individual activities in proportion to the time they spend. Some types of costs, without being distributed, completely transfer their value to a certain type of activity.

Stage 4. Distribution of departmental costs between activities.

Calculations are made in the form of special tables. In the first column of the table, cost items are indicated (for example, staff salaries, transportation costs, etc.), in the second - the corresponding amount of costs for the year. For each type of cost, the percentage of their assignment to the corresponding types of activity is displayed and the costs for each type of activity for all departments are calculated.

Stage 5. Determination of the cost of each type of activity.

To do this, the data for all departments obtained at the previous stage are summarized.

Stage 6. Distribution of expenses for auxiliary activities between the main activities and calculation of the full cost of the latter.

Calculations are made in the form of special tables, the lines of which are the main types of activities and their cost, calculated at the previous stage. The columns of the table indicate the codes of auxiliary activities. Their cost is distributed among the main activities with the help of cost drivers.

Stage 7. Calculation of the unit cost of the cost carrier.

To do this, the total costs by activity, calculated in step 6, are divided by the number of cost carriers. The latter are taken from company statistics. As a result, the unit cost of each cost carrier is formed, i.e. the cost of one operation.

Step 8. Determine the total costs for the main activities related to a particular product or to a particular client.

To do this, the company's statistics on the number of cost carriers, depending on the line of business, are multiplied by the unit cost of the carrier.

The total costs for various activities are determined by summing the results obtained. Similar calculations are carried out in all areas of activity.

Stage 9. Calculation of the total cost of the company's activities.

Add "non-attributable" costs to total costs.

So, the ABC-method contributes both to control over the level of expenses of the organization, and more effective management of its profit.

The ABC system can be conditionally divided into two areas:

1) cost management;

2) profit management.

First direction allows managers to manage departments or processes more effectively. Understanding how the work of their departments is built and what factors determine the amount of this work creates the necessary conditions for eliminating overhead costs, and therefore reducing costs in general.

In this case, the subject of study and evaluation are individual operations (secondary activities) that make up the main activities.

The ABC method allows not only to analyze costs by categories of secondary activities, but also to determine which items of expenditure and in what proportion make up their cost.

Second direction is by no means limited to cost-plus pricing. Profit management rather consists in achieving a deeper understanding of what exactly is its source:

– what products;

– what kind of clients;

– what geographical segments;

– what are the commercial zones;

and how to change the commercial and market strategy to increase profits.

The ABC method allows you to evaluate the "contribution" of each client to the formation of the final financial result. So, a large client who sends correspondence often and in large quantities can actually bring only a minimal profit, or even turn out to be unprofitable due to the fact that the efforts and funds expended on it are not fully covered by incoming payments.

The availability of such information is a prerequisite for making a decision regarding each client:

- how can you reduce the cost of servicing him, or increase the price for him and evaluate his reaction, or leave everything as it is and retain this client as obviously unprofitable, but prestigious, etc.