Cost accounting has gone through an evolution to become essential for the financial strategy and structure of an organization. Here are the top reasons why your organization should have robust cost accounting:
- It determines business success
- Helps you make informed decisions
- Works as a performance measure
- Enables optimum resource utilization
Cost accounting provides the necessary cost details that you need to oversee your operations and make informed decisions. It usually falls on the accounting and finance teams to produce this information. Microsoft Dynamics 365 Business Central can help you allocate actual or budgeted costs of your operations to your cost centers and cost elements (materials, labor, overhead) in order to analyze profitability.
Dynamics 365 Business Central lets you define cost types, cost centers, and cost objects to analyze what the costs are, where they come from, and who should bear them. You define a chart of cost types with a structure that resembles your general ledger chart of accounts. You can transfer the general ledger income statement accounts or create your own chart of cost types. The system will walk you through a guided process to set up your chart of cost types including where cost centers are assigned and how costs are allocated.
Customized Cost Management
The cost accounting software module allows you to freely define cost elements, cost centers, and cost objects and link them together. Cost Accounting synchronizes cost information with the general ledger and then allocates that information to different cost centers and cost objects. The required data can be transferred directly from general ledger accounting in Dynamics 365 Business Central to the Cost Accounting module. Of course, it is also easy to import and export budgets to and from Excel.
Costs Budgets and Cost Reporting
There is no limit to the number of costs budgets you can create. You can even copy cost budgets from your general leader budgets or updated your general budgets from cost budgets. Several cost reports are provided by the system that makes it easier for you to perform analysis. You can create your own reports using the account schedules and analysis by dimensions features of the system. There is a Power BI connector for those interested in creating specialized dashboards and visualizations.
The key benefits of the Dyn365BC cost accounting module include:
- You can analyze the end-to-end business cash flow
- It enables you to allocate costs based on the costs rates or consumers
- Entails easy-to-use and flexible cost allocation schemes
- Ability to perform different versions of cost analysis parallelly for actual, simulated, projected, or future periods or strategies
- Helps fulfill reporting requirements for both consolidated and analytical reporting
Contact us to schedule a personalized demo and learn more about Dynamics 365 Business Central that will help to streamline your business.