Process-oriented calculation

Traditional costing methods do not take into account any differences between standard and exotic products, high or low administrative and coordination costs, large or small orders, complex or simple distribution channels, etc. no connection to the effort that the products cause in the indirect area (overhead cost management). By neglecting the differences in the relative consumption of overhead resources, the overhead calculation leads to distorted product costs.
Beispielsweise werden durch die Verwendung pauschaler Zuschläge auf Wertbasis seltene Sonderprodukte mit geringen Direct material costs, die in den indirekten Bereichen aber einen hohen Aufwand verursachen, vergleichsweise mit zu geringen Gemeinkosten belastet, während unkomplizierte Standardprodukte mit hohen Materialeinzelkosten einen zu hohen Gemeinkostenteil zu tragen haben. Auf Basis dieser Ergebnisse drohen produktpolitische Fehlentscheidungen, da eine realistische Beurteilung des Erfolgsbeitrags der einzelnen Produkte nicht möglich ist. Beispielsweise könnte man zu der Entscheidung gelangen, dass eine weitere Förderung der Sonderprodukte und eine geringere Produktion von Standardprodukten die richtige Strategie zur Erhöhung des Gewinns sei. Da aber in Wirklichkeit die Sonderprodukte durch die Standardprodukte subventioniert werden, ist bei Realisierung einer solchen Strategie statt mit einer Gewinnerhöhung mit drastischen Einbußen zu rechnen.

With the help of the process-oriented calculation, the costs of the processes should be added to the products that they triggered in the indirect areas. In this way, one of the most important principles of cost allocation, causation justice, is to be better complied with in order to avoid wrong strategic decisions. The process-oriented calculation is therefore sometimes also referred to as a strategic calculation. This designation also indicates that the observation period of the process-oriented calculation is of a medium to long-term nature and is less suitable for short-term production decisions.

With regard to the design of the process-oriented calculation, there are different forms of expression:

In the American-style process-like calculation, all overhead costs are offset against the products with the help of the cost driver. The prerequisite that a direct product relationship can be established for all costs is, however, not met in practice for at least some of the costs.

The process-oriented surcharge calculation is a surcharge calculation in which the surcharge rates are not formed on the basis of the known values, but rather on the basis of process-related aspects such as the degree of complexity. The products are divided into homogeneous groups, for which a uniform surcharge rate is then used. In this way, the idea of process-oriented cost accounting is to be complied with, at least roughly. However, depending on the degree of differentiation, either the low information gain or the high implementation effort speak against this procedure.
In practice, a combination of both approaches has proven itself, ie a process-oriented addition to the overhead calculation. Part of the overhead costs are offset in a process-analogous manner by using process cost rates and the remaining overhead costs with the help of (process-oriented or traditional) overhead rates. In this way, the advantages of both methods can be used and the additional effort of the process-oriented calculation can be kept within limits. This procedure is also to be assumed in the following.

With regard to process-oriented cost unit accounting, a distinction must be made between three process categories:

Wholesale processes include administrative and planning activities in the context of product development that are not assigned to development orders via project or order numbers. In relation to the cost unit, the costs of these processes are to be treated like development costs.

Support processes include all activities that arise in connection with the maintenance of a cost object (product, component, supplier, customer). As part of the calculation, the costs for support processes must be offset against the average number of units per year in order to determine the unit cost amount.

Handling processes include all logistical and administrative activities. The costs incurred are always related to the processing of a procurement, production or sales order and are to be divided by the lot size in the calculation.

In the process-oriented calculation, the overhead costs are assigned to the products or other cost objects with the help of the main process cost rates - depending on the respective utilization. The process-oriented addition is carried out at every calculation level from the material to house parts and assemblies to the end product. The process cost rates used for offsetting are planned annually and no longer changed during the year in order to avoid fluctuations in product costs depending on the utilization of the overhead cost areas. The process-oriented calculation can be used as a case-by-case ancillary calculation or as a replacement for the previous calculation.

The figure shows the general treatment of the cost components in the process-oriented calculation. As before, direct costs (material, wages, etc.) are allocated directly to the cost bearers. The costs of the indirect areas, which are accessible to a process-oriented billing, are charged to the cost units with the help of the main process cost rates depending on the use made with the help of the cost drivers. It should be noted that the main process cost rates are total process cost rates, which therefore also contain a proportion of costs that are neutral in terms of service volume.

The performance-quantity-neutral costs were allocated to the sub-processes contained in the main process in proportion to their performance-quantity-induced costs. The activity quantity-neutral costs are therefore only offset indirectly to the cost objects. In order to increase the fairness of causation, equivalence numbers, which are dependent on the process complexity, for example, can also be used in the offsetting of the process costs. By dividing the process costs into a volume and variant-dependent portion, a variant calculation can also be carried out. The process costs are shown separately in the calculation and can thus be included depending on the decision-making situation. The part of the overhead costs that is not accessible to process-oriented treatment due to a lack of cause-effect relationships is offset with the help of product, order or customer-specific surcharge rates.

A process-oriented addition to the calculation leads to the following three effects that can be used to design the product range in line with the strategy. These effects are therefore also referred to as the strategic information advantage of the process costs (carrier item) calculation.

Allocation effect: Da bei der prozessorientierten Kalkulation die Zuordnung (Allocation) der Gemeinkosten auf die Produkte nach der Inanspruchnahme der betrieblichen Ressourcen erfolgt und so eine proportionale Verrechnung von Gemeinkosten in Abhängigkeit wertorientierter Zuschlagsbasen (wie z.B. Material- oder Lohneinzelkosten) vermieden wird, entstehen im Vergleich zur Zuschlagskalkulation Differenzen bei den verrechneten Gemeinkosten.

Complexity Effect: The differences between the overhead calculation and the process-oriented calculation caused by the different product complexity are referred to as the complexity effect. The excessive cost burden of products with low complexity in favor of products with very high complexity, which can be observed in the surcharge calculation, does not occur in the process-oriented calculation. Measures derived from the complexity effect are often aimed at reducing the number of variants and streamlining the product range.

Degression effect: In the process-oriented calculation, it is taken into account that the effort of some processes is independent of the quantity. For example, the effort involved in the order acceptance process does not depend on the number of items ordered. As the order quantity increases, the costs of the "order acceptance" process per item are degressive. The too low cost burden of orders with low numbers of items or the too high cost burden of large orders when using value-based surcharge bases (eg the ordered goods value) is thus avoided. From the knowledge of the degression effect, for example, a minimum order size can be derived from which it is advantageous to accept an order.

The manufacturing costs determined in a process-oriented manner make it clear whether the process costs of a variant are distributed over a large or small batch size, whether a product consists of many or a few parts or whether it is manufactured in a large or small number of production stages. The results of the process-oriented calculation not only provide important information on the product level, but also, for example, for questions about in-house production or external procurement, taking into account the process costs from procurement and logistics. A customer order-related calculation can follow the process-oriented manufacturing cost calculation and serve to assess the profitability of individual customers or orders.

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