Sharp ideas for controlling costs

Abstract

Typically, business management shies away from cost accounting. But it is a major area of operations. And unfortunately, everything affecting the business's operations relates to cost accounting. So how can you develop effective systems for identifying, reporting, and controlling costs? This article is adapted from Effective Operations and Controls for the Small Privately Held Business by Rob Reider, published by John Wiley & Sons, Inc., in December 2007. © 2007 Rob Reider.

Reassessing the Impact of Risk Management Capabilities on Firm Value: A Stakeholders Perspective

“…But, companies cost management can add "dollar for dollar" contribution. Therefore, the effective cost management and control has more value adding potential then increased sale (Reider, 2008). But despite its pivotal role in business operation the very nature of the firm's cost is still a debatable issue.…”

“…In the field of accounting and finance it is often indicated by cost of goods sold. It incorporates direct cost such purchase of goods, raw materials and indirect costs related to warehousing, facilities, equipment, and labour (Hugos, 2018;Reider, 2008). The firms with the capabilities to manage those costs and associated risks will show better performance (Kaplan, 1983).…”

“…Subsequently this will lead to decrease in earnings volatility and increase profitability. In today competitive world, we cannot under estimate the importance of firm's cost at the time of risk management (Moser & Martin, 2012;Reider, 2008). The presence of higher firm's risk will trigger disruptive and unstable future cash flow (Fama & French, 1993).…”