Talking Cents

An introduction to cost management systems, by our small business accountants in Melbourne

A cost management system is an important part of an organisation as they enable accountants to provide managers with the cost and benefit information that they need. Cost management systems help our small business accountants in Melbourne plan, control and make decisions that affect the entire organisation.

The main purpose of a cost management system is to ensure profitability in the short term and also to maintain a competitive position in the long term. As business accountants in Melbourne we must ensure organisational efficiency in all financial operations. Therefore, a cost management system will focus on ensuring efficiency in specific costs such as manufacturing, service, marketing and administration. These services must be performed in a timely manner, provide accurate information and be highly specific.

To make it easier for organisations to understand the role of a cost management system, our accountants for small business in Southbank have outlined the following goals associated with a cost management system:
- Develop reasonably accurate product costs
- Assess product/service life-cycle performance
- Improve understanding of processes and activities
- Control cost
- Measure performance
- Allow pursuit of organisational strategies

For more information about cost management systems, please contact our small business accountants in Melbourne today.