Course Methodology
This course aims at making this advanced subject easier
for participants to understand by covering the material using several examples
and exercises. In addition, there will be explanations from the subject matter
expert and a sharing of knowledge between participants.
Course Objectives
By the end of the course, participants will be able to:
- Discover the
importance of analyzing and managing costs
- Develop important
tools for planning and decision making
- Explain Activity-Based
Costing (ABC) and Activity-Based Management (ABM)
- Estimate costs and
allocate them properly
- Evaluate and manage
performance through strategic cost management
Target Audience
Financial managers or directors, accountants, financial
assistants, budget accountants, analysts, budget and planning managers and
coordinators, operations managers, facilities managers and professionals
interested in cost management.
Target Competencies
- Distinguishing relevant costs
- Analyzing costs
- Allocating costs
- Calculating product costs using different methods
- Assessing value adding costs
- Choosing between cost alternatives
- Advising management to buy or manufacture
- Evaluating performance
Strategic need for analyzing and managing costs
- Definition of cost management
- Dimensions of cost management
- Product costing systems: concepts and design
issues
- Cost behavior, types and hierarchy
- Cost accumulation job shop
- Batch production operations
- Variable versus absorption costing
Cost management decisions
- Decision making process
- Identifying relevant costs
- Evaluating alternatives
- Outsourcing decisions : make or buy
- Add or drop product or business line
- Replacing equipment
- Special order pricing decisions
Activity based management
- ABC systems
- Analyzing value added versus non value added
activities
- Activity-based management
- Managing customer profitability
- Managing quality and time to create value
Cost estimation and transfer pricing
- Cost estimation techniques
- Identifying and choosing a cost driver
- Simple regression analysis
- Multiple regression analysis
- High-low method
- Applications in Microsoft Excel
- Allocating costs of support departments
- Direct method
- Step method
- Reciprocal method
- Inter-group transfer pricing issues
Evaluating and managing performance
- Cost, volume, profit analysis
- Breakeven point
- Breakeven point for multiple products
- Target income
- Operating leverage
- Margin of safety
- Managing scarce resources
- Flexible budget
- Activity-based budgeting
- Strategy, balanced scorecards and performance
measurement
