If you’re in finance or accounting at a manufacturing company, then this guide is for you. To understand and explain your company’s performance, here are the SEVEN activities that must be a part of your analytics process.

[Seven Finance Activities Every Manufacturing Company Needs]

This guide is published by 3C Software

[Product Costing]

For product costing, more is better. Calculating product costs –regardless of methodology – should occur at the most granular level available for every product/SKU manufactured. With this level of cost detail, the data user can drill down to easily verify and understand summary numbers.

[Profitability]

Regardless of methodology – allocation, activity-based, or absorption –the most important aspect of understand profitability is creating a standard process that provides visibility from every dimension. Calculating profitability must occur from both the product and customer perspectiveto get a complete picture of company performance.

[Inventory Valuation]

Inventory is a critical balance sheet item. Outside influences like raw material price changes and shifting product demand make accurately calculating value complex. Consistent valuations require developing a set of rules that comply with GAAP and internal auditing rules.

[Planning and Scenario Analysis]

Best-of-breed cost and profitability processes include the ability to adjust any variable – raw material prices, currencies, machine efficiencies, labor rates, product volumes and mixes, etc. – and see the impact across the board. The accuracy of forward-looking analytics is directly correlated to the level of cost data available.

[Process Costing & Rate Building]

Costs are generated as part of the production process and are allocated to products using rates. The most accurate way to calculate allocation rates is by pooling spending (planned or actual) and using drivers to allocate spending to each cost center. Rates are calculated by dividing the pool by the appropriate driver and then used to apply cost center costs to individual products.

[Variance Analysis]

Whether comparing planned to actual results or two the difference between possible scenarios, variances provide insight and value. To get a true understanding of a company’s performance, both usage (units) and cost (dollar) variances for materials, labor and overhead at each level (SKU, department, plant, division, company) are necessary.

[Budgeting]

Estimating operational costs for future periods must guide spending decisions. Allocation rules are used to assign spending and pools of dollars are linked with general ledger accounts. To keep budgets relevant, recalculate the results periodically to account for current market conditions.

[Meet ImpactECS]

ImpactECS is used across the globe by leading companies in many manufacturing sectors. The platform offers business users the

flexibility to build and manage complex cost and profitability models and decision makers access to detailed results with just a few clicks.

Create an [unlimited number of detailed cost models] that align with your business processes and use [any accounting methodology].

Generate [product and customer level P&L statements] that offer [drill-down capabilities] to view the drivers that affect profitability.

Create planning models using the [same data and logic] as the production system to simulate the affect of [adjusting any model input].

Calculate inventory values using [LIFO, FIFO or weighted average] and include costs for [subcontractor inventory, consignment products, and reserves].

[Collect direct spending] using historical data or [calculate from a zero-basis] to [dynamically calculate rates] at the natural cost elements.

[Calculate variances at the account level] and post results directly to the general ledger.

Build budgets using [historical data or from a zero-basis] and [flex the results] to see how changes affect performance.

Product Costing

Profitability

Inventory Valuation

Process Costing & Rate Building

Planning & Scenario Analysis

Budgeting

Variance Analysis

[What can I do with ImpactECS?]

[Ready to Meet ImpactECS?]

Online www.3csoftware.comSocial

Phone 800-226-2036Email sales@3csoftware.com