UNIFORM COSTING INTER FIRM COMPARISION UNIFORM COSTING Adoption

UNIFORM COSTING � � � Adoption of Common Costing Principles Techniques Methods & practices

PURPOSE OF UNIFORM COSTING � � Facilitates better COST COMPARISION COST REDUCTION & CONTROL

Preconditions for Installation of a Uniform Costing System � � Firms in the Industry

Objectives of Uniform Costing � � Facilitate Inter firm comparison Eliminate Unhealthy competition Reduce

INTER FIRM COMPARISION � � Technique of Evaluating PERFORMANCE, EFFICIENCY, COSTS & PROFITS of

PRECONDITIONS FOR INSTALLATING A SYSTEM OF INTER FIRM COMPARISON � � Creation of a

Creation of a CENTRE for Inter firm comparison. � � Collection of identified data

Identification of Data & Information requirement � � � Cost & Cost structure. Raw

Advantages of Inter Firm Comparison � � Helps a firm in knowing its strengths

Disadvantages � Lack of Confidentiality. � Lack of reliable information and cost data. �

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UNIFORM COSTING & INTER FIRM COMPARISION

UNIFORM COSTING � � � Adoption of Common Costing Principles Techniques Methods & practices By various firms in the Industry

PURPOSE OF UNIFORM COSTING � � Facilitates better COST COMPARISION COST REDUCTION & CONTROL

Preconditions for Installation of a Uniform Costing System � � Firms in the Industry willing to share, furnish relevant data/information. Spirit of Cooperation & Mutual trust should prevail among the participating firms. Mutual exchange of ideas, methods used. Bigger firms should take the lead towards sharing their experience & know how with the smaller firms.

Objectives of Uniform Costing � � Facilitate Inter firm comparison Eliminate Unhealthy competition Reduce the cost Standardise the Cost Accounting methods

INTER FIRM COMPARISION � � Technique of Evaluating PERFORMANCE, EFFICIENCY, COSTS & PROFITS of Firms in the Industry. Consists of Voluntary exchange of Information/data relating to COST, PRICE, PRODUCTIVITY & overall Efficiency among firms.

PRECONDITIONS FOR INSTALLATING A SYSTEM OF INTER FIRM COMPARISON � � Creation of a CENTRE for Inter firm comparison. Membership of Centre. Identification of Data & Information requirement. Methods of Collection & Presentation of Data/Information.

Creation of a CENTRE for Inter firm comparison. � � Collection of identified data & information from different units in an Industry. Dissemination of results to its members. Undertaking Research & Development for common & individual benefits of its members. Orgainising Training Programmes & publishing magazines.

Membership of Centre

Identification of Data & Information requirement � � � Cost & Cost structure. Raw materials consumption. Stock of raw materials. Wastages. Labour efficiency & utilisation. Creditors & debtors.

Advantages of Inter Firm Comparison � � Helps a firm in knowing its strengths & weaknesses. Ensures unbiased & specified reporting to the firm. Helps to improve the Quality of products. Helps the Govt. in bringing Price regulation.

Disadvantages � Lack of Confidentiality. � Lack of reliable information and cost data. � Lack of basis of comparison.