The Secret of Effective Activity-Based Costing and Management (ABC/M)

Overview

At a time when growing the revenue line is increasingly difficult and those costs that are easiest to cut back are down to the bone, surely any CFO would jump at an initiative, such as activity-based costing (ABC), that typically delivers a payback many times over and will help to increase their financial performance. They certainly ought to, but often they are reluctant because ABC has a perception of being "complicated".

This paper sets out a methodology to avoid over-complication, ensuring that an ABC project is clearly focused on the needs of users and extraneous detail is excluded from models.