Cost Accounting, R.I.P.: Cost Accounting Is Opinion, Cash Flow Is Fact 2024

Register Now
  • Date/Time
    • Dec 26, 2024
    • Sign In: 8:30am (MT)
    • Program: 9:00am - 12:30pm (MT)
    • Add to Calendar
  • Location
    • Your Computer
      Your Space
      ISCPA / CalCPE Webinar, ID 00000
  • Credits
    • 4.00
  • Credit Type(s)
    • Accounting (4.00)
  • Prerequisites
    • None

  • Vendor
    • California CPA Education Foundation
  • Level
    • Overview
  • Fields of Study
    • Accounting

Description

Organizations often focus on cost accounting data but don't look at all the factors that influence that data. As a result, vast sums are spent to allocate costs that have nothing to do with cash. Instead, start with value, determine price, and then justify costs that can incur profits. Since you can calculate different costs using the same data, it's evident that costs do not represent cash. Cost accounting confuses metrics with measurements. Cost accounting is a bad practice because you create and force math and relationships that do not exist. By doing this, you lose touch with your operations. You make meaningless numbers that people consider as gospel when, in reality, they are nothing but opinions. A company needs to start with value and then determine price, which justifies the costs that can be profitably incurred to produce a good or service. It seems obvious to constrain a company with a final price before you incur any costs, yet this practice has yet to be widely followed despite its proven successes. Costs are undoubtedly essential, but the crucial distinction is when they are viewed and what measures to use.

  • Presenters - Ronald Joseph Baker
  • Designed For

    Designed For: Accounting and financial professionals.
  • Role Level - Entry-level/Individual contributor; Manager/Senior Manager; Director; Sole Practitioner
  • Objectives

    • Identify why modeling cash flow and capacity is superior to cost accounting
    • Recognize the Adaptive Capacity Model
    • Determine the difference between metrics and measurements
    • Recognize Segall's Law: A person with one watch knows what time it is; a person with two watches is never quite sure

    Highlights

    • Modeling cash flow and capacity
    • Adaptive Capacity Model
    • Segall's Law

    Advanced Prep

    None

    Register Now

    Leaders

    CALCPE Panel

    No Biography Available

    ← Back to List