Value and advantages of Expense Control Chart. It is constantly advisable for CMA Department to prepare Cost Control Chart as discussed in Annexure– 1. Expense Control Chart provides the following details:
It lists down all the Cost Elements bifurcated into appropriate Cost Centres like:
- Production Cost Centres
- Utilities Cost Centres
- Overhead Expense Centres like FOH, AOH & SOH
- Costs not consisted of in Cost
- Total of each Cost Aspects according to Control Chart
- Overall of each Expense Aspects based on Earnings & Loss Account
- There need to not be any difference between Total as per Control Chart and Total as per P & L Account
Content in this Article.
Value and Benefits of Expenditure Control Chart:
1) It ensures that all the expenditures incurred based on P & L Account are effectively represented at the time of Building Up of Expense Records and Resultant Product Cost Sheets.
2) It provides sensible assurance to management that cost supplied by CMA Department are trustworthy for decision making.
3) It assists in various statutory compliances like:
- Valuation of Stocks for both Financial Accounts and Expense Accounts
- Preparation, audit and filing of Expense Audit Report
4) Information for Anti Dumping can be prepared and submitted with reasonable precision
5) Any other Costing Based MIS Report, if any required by management, can be prepared and sent with sensible precision and reliability
The Quote and the Project Spending Plan
The estimate is a fixed document at a particular time (Quote time). The price quote shows what the project was bid for and the amounts and unit rates used.
The project budget continuously develops until task completion. The job budget shows the real scope at the site and the actual amounts from construction provided drawings and a standard performance rate. The task budget will always consist of change orders and extra work orders in terms of changed quantities and expenses. These terms are very important because the efficiency and labor expense reports should show the job budget plan. The task budget need to show the actual amounts positioned and a basic system rate for each work activity.
The project budget plan need to be compared to the price quote however this contrast need to just be made in the Task Cost Summary Report. This report compares the actual and projected quantities, workhours and costs for the task to the approximated costs.
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