- Conventional Driver-Based Activity Based Costing (ABC)
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- Recognizing the shortcomings of conventional absorption cost accounting, Activity-Based Costing has emerged as a tool whereby product cost distortion, as computed in conventional absorption cost accounting, was to lessened the inaccuracies of ACA. ABC was designed to eliminate the large cost pools and unrealistic allocation methods associated with traditional costing methods. However, the ABC system uses a two- stage process for allocating resource costs first to activities then, in turn, allocating activity costs to cost objects which also creates the potential for significance errors.
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- I remember hearing the old sayings about performance measurement early on in my career, and thinking they were pretty astute – catchy and encapsulating a profound truth. Things like: “If you don’t measure it, you don’t manage it!” “What gets measured gets done!”
- The Sweeping Change in Finance
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- The environment we find ourselves in today validates how important it is that we continue to accelerate the adoption of the trends noted in this article. Some of our businesses won’t survive unless we do. Learn where your CFO suite fits into these trends and what you can do to accelerate them. Decision support is moving finance beyond the traditional governance model. There are big changes afoot in finance. Accounting, Finance and Treasury departments are moving forward by creating value for the businesses they serve. Technology, better developed models, broader training and the eclectic nature of today’s finance professionals have put this movement into full gear.
Governance & Controls – structure and controls.
Transaction Recording – systems, transaction processing and closing the books.
Reporting - efficient, timely and accurate information for decision making and meeting compliance requirements.
Accounting
Business Planning - provide the financial roadmap for the company with supporting analytics.
Financial Forecasting - integrate the company’s current performance relative to budget with the real-time business environment.
Investment Analysis - the framework to analyze new opportunities as they present themselves.
Finance
Cash Management - the discipline to ensure cash is available to operate the business normally.
Funding - Planning for and raising funds to meet the needs of the business.
Risk Management – Identification and mitigation of key business risks.
Treasury
Self-Awareness - Internal.
Team Building - External.
Strategy & Culture – Motivate people to follow you.
Leadership
Four Pillars of Executive Expertise
CFO.University is built around the Four Pillars of CFO Success. These Pillars are supported with Core Competencies. Our framework allows you to master your role as a senior financial officer. The Four Pillars are made up of:
Accounting – Governance & Controls, Transaction Recording and Reporting
Finance – Business Planning, Financial Forecasting and Investment Analysis
Treasury – Cash Management, Funding (Capital Raising) and Risk Management
Leadership – Self Awareness, Team Building and Strategy & Culture
