Managerial Cost Accounting

1
Managerial Cost Accounting

• Presented byJohn Brewer

2
Definition

• Managerial Cost Accounting (MCA) involves
  accumulating and analyzing both financial and
  non-financial data to determine the costs of
  achieving performance goals, delivering programs,
  and pursuing other activities.

3
Statement of Federal Financial Accounting
Standards (SFFAS) 4

• SFFAS 4 MCA Concepts sets five standards -
• Accumulate and report the costs of activities
  regularly for management information purposes,
• Establish responsibility segments, report the
  costs of segment outputs, and calculate the unit
  cost of each output,
• Determine and report the full costs of government
  goods and services, including direct and indirect
  costs,
• Recognize the costs of goods and services
  provided by other federal entities,
• Use appropriate costing methodologies to
  accumulate and assign costs to outputs.

4
SFFAS 30 Inter-Entity CostFull Cost Provision

• Effective October 1, 2008, SFFAS 30 requires
  full implementation of the inter-entity cost
  provision in the SFFAS 4.
• Each reporting entitys full cost should
  incorporate cost of goods and services received
  from other entities.
• The entity providing the goods and services must
  provide the receiving entity with the full cost
  of such goods and services either through billing
  or other advice.

5
Progress to Date

• MCA Workgroup
• Identified best practices/best practitioners
• Shared best practices and tools
• Identified impediments
• Coordinating implementation of these managerial
  cost accounting practices into the new financial
  accounting system (FMMI)