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COST ANALYSIS AND CONTROL

Effective cost control is a key factor in the success of a company in the face of fierce market competition. Cost management does not merely mean reducing costs and expenses, it also means that we should set up a rational and sensible system of cost analysis and cost control which can give the business management team a clear picture of the company’s cost structure and profits, and can give correct guidance for decision making. Therefore, this system is important to a company’s internal decision-making process and can fundamentally improve cost management for effective cost control.

Training Objectives

Break through the frame of traditional cost control, analyze and control cost from the systematic view of business operation.
Master key methods of cost accounting and the advantages & disadvantages (applicability) of each method. Improve existing cost accounting systems to keep up with changes in situation.
Have a command of the fundamental methods of cost analysis and provide key and effective cost information for management decisions.
Through cost analysis, effectively improve cost structure.

Training Attendees

Cost accountant
Financial analysts
Accountant manager
Senior financial manager
Personnel charged with cost control responsibilities


	Training Outline

	Business Cost Model and Competitive Advantages
	How to balance the relationship between business increase and cost control
	- Cost features under different business models
	- Cost leadership –process of excellence
	- Differentiation – leading products
	- Market segmentation (focused) – customer oriented
	How to choose the most competitive cost model to suit a business
	Understand cost structure and how it is related to your work
	Where is cost management in corporate finance
	- Narrow and broad definitions of cost
	- Break through the limitation of cost control in a narrow definition, manage cost in a more comprehensive and innovative way
	Four typical cost classifications and their significance to cost control
	- Analysis of material, labor and overhead of products
	- Analysis of manufacture cost, sales expense, overhead and finance expense


	- Analysis of variable and fixed cost


	- Analysis of direct and indirect cost


	The influence on cost of each department and personnel
	- Cost pyramid: systemic cost breakdown
	- How does each department affect the business cost
	Choose a cost accounting system that is easy for cost control
	The classification of different cost accounting systems and the significance of cost control
	- 3A costing model



	- Standard costing


	Establishment of cost centers – allocate cost responsibilities
	- Product-centered – how to manage cost
	- Department-centered – how to manage cost
	- Key point in cost center management – Partition of power and responsibility
	- How to combine cost center and budget center
	Advanced method of indirect cost control – activity-based costing
	- The activity-based costing model and the considerations of activity-based costing
	- The importance of process management
	- Case study: application of activity-based costing
	Control cost with effective cost analysis
	Break-even point tracking
	- A profound analysis of cost behavior: variability and invariability



	- Relationship between the break-even point and Economics of Scale
	- Marginal contribution
	- Case study
	The CVP analysis – the impact of cost, volume, and price to profit
	- 3 leverages to improve business profit
	- An analysis of a factor’s sensitivity
	- Case study: single factor and multiple factors
	Profitability analysis of products, business units, and corporate
	- The method of profitability analysis for different products, departments and subsidiaries
	- Cost center management
	Cost control towards improving core competence
	- Improve cost structure by product valuation
	- Optimize business processes
	- Remove bottle necks
	- Strategic cost and non-strategy cost
	- Value-added activity and non-value-added activity