Evaluating The Cost Structures Of A Firm And Determine The Reason For Expenses Increasing

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Advances in the application of new cost techniques, is not always adequate for planning future cost for a company (Cokins et al, 2012). In some cases, organizations Cokins et al (2012) explains, the gap seems to widen between management accountants and the management staff and employees. The reason for these gaps can stem from various areas of operations. A company’s strategic shifts can either work effectively or ineffectively. Managers pursue many approaches to find the most effective route to successfully implementing a strategic plan for increasing a firm’s financial position. The pertinent information gain from historical and assumed future data allows managers to plan accordingly. The main purpose of this study is to evaluate the cost structures of a firm and determine the reason for expenses increasing, if certain situations occurs. Bloch et al (2013) describes four stages of strategic cost management systems as:
• Reporting systems which holds basic transaction information.
• External financial reporting systems provide financial information that is useful to the firm.
• Monitoring of operational data and develop more accurate operational and relevant cost information for decision making.
• Strategic cost management information.
The information provided by the cost management systems, allows management accountants and managers with valuable data to help with their decision making. In addition to these systems, implementing other analytical tools will also help with

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