Total cost management at Parker Hannifin

Article Abstract:

Parker Hannifin Corp is re-examining the role of management accountants and cost accounting in the way it runs its business. Management's commitment to long-term strategic goals and to achieving short-term profit goals has enabled Parker Hannifin to focus on becoming an outstanding manufacturer of motion control systems and components. The company has directed various major efforts with the support of management, including: establishing an active involvement in organizations supporting cooperative research development in computer-integrated manufacturing and establishing a Productivity Council to foster innovations. Parker Hannifin has also updated recruiting and training programs for young accountants, and in-depth training is offered to division and group management.

Management, Manufacturing industry, Manufacturing industries, Labor productivity, Parker Hannifin Corp., company profile

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How advanced manufacturing technologies are reshaping cost management

Article Abstract:

To be competitive, manufacturers must provide products of high quality at low cost while at the same time maintaining good customer relations. Cost management systems are deterring factory automation by not providing companies with the necessary financial data. Technology is changing the basis of competition, shortening product life cycles, and increasing the percentage of fixed costs. As a result, cost management systems are being affected in terms of depreciation techniques, determination of product cost, how costs are allocated and classified, and procedures for internal control in an increasingly paperless environment.

Finance, Technology application, Products, Factories

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Technology accounting

Article Abstract:

The accounting method for high technology cost should be changed from the simple capital asset depreciation method used today to a method which treats technology as a direct cost, the way direct labor and materials are treated. The methods should be revamped because technology is augmenting or even replacing direct labor; technology is developing at such a rate that equipment is often obsolete long before it is worn; and technology is directly specified, so its costs should be directly computed. Examples are discussed to illustrate the rationale for implementing the new accounting method.

Accounting and auditing, High technology, Capital assets, Depreciation

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