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Activity-Based Cost Management in Government

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Title: Activity-Based Cost Management in Government
by Gary Cokins
ISBN: 1-56726-110-8
Publisher: Management Concepts, Inc.
Pub. Date: 01 November, 2001
Format: Hardcover
Volumes: 1
List Price(USD): $79.00
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Average Customer Rating: 4.8 (10 reviews)

Customer Reviews

Rating: 5
Summary: A Must-Read
Comment: For any public sector organization considering or currently implementing activity based costing, Gary Cokins' excellent book is a must-read. Although government agencies are increasingly required to improve performance with fewer resources and recognize the need to implement a cost accounting system, there has been little published guidance on ABC applicable to the public sector. Comprehensive, well-wrwitten, and easily understandable, this book exceptionally fills that gap for novice and experienced cost accountant alike.

Cokins begins with a thorough introduction to the fundamentals of activity based cost management and its applicability to a government setting in such areas as outsourcing/privatization studies, fees for service, process improvement, performance measurement and budgeting. All basic concepts are covered, such as views of cost assignment, cost drivers, level of data collection required and allocation of support costs. Everything is explained in easy to understand language and copiously illustrated with visuals and actual government examples. Practical advice on successful implementation and pitfalls to avoid is offered throughout.

After laying a solid foundation, chapters 5-8 address more advanced topics including utilizing ABC/M to assess quality and value, balanced scorecard performance measures, activity based budgeting and supply chain management. Using ABC for these purposes, although probably not attainable in its initial implementation, are important to bear in mind as longer term goals.

I found chapteres 9 - 11 essential for agencies beginning ABC implementation. In Chapter 9, Cokins discusses the value of rapid prototyping with a few key employees in order to produce a repeatable, reliable and relevant production system, and guides you through the process step by step. Chapter 10 presents case studies of successful ABC implementation in the public sector, and Chapter 11 discusses what you will need to obtain employee buy-in.

Overall, I found this book to be an extremely valuable resource and recommend it highly.

Rating: 5
Summary: The leading resource in the ABC/ABM field
Comment: Gary Cokins does an excellent job explaining Activity Based Costing and Activity Based Management from beginning to end. By reading the first chapter alone, one can tell he is an expert in his field. He begins explaining the subject matter with the basics and continues through using an easy to follow logic. For public sector organizations that are considering ABC/M, or already using it, this book is a master guide for its methodology. It has very helpful charts which the author uses in his explanation of the material, making it easy for the reader to follow.

I have spent over 30 years in government, and the one aspect always apparent is that the government is always trying to improve performance with fewer resources, and therefore recognizes the need for activity based costing. This book is, by far, the leading reference to refer to for guidance on how to implement ABC/M. The reader does not have to be a cost accountant to comprehend the methodology or technique used to implement ABC/M. The author cites actual cases in the public sector where federal or local agencies have implemented this technique and the successes made. He begins with the issue or problem and cites the solution, the model structure used, the results, and the lessons learned. These actual case examples help show how ABC/M can resolve problems in the real world.

Overall, I found this book to be an excellent resource in its field, as it is easily understood, yet comprehensive. I strongly recommend it to any government manager that wants to help their organization excel.

Rating: 5
Summary: COST MANAGEMENT IN GOVERNMENT
Comment: Activity based cost management is increasingly taking hold in government and is helping many organizations make dramatic improvements in their understanding of costs. Gary Cokins, a widely respected cost management craftsman and teacher, has made an outstanding contribution to the advancement cost management in his book "Activity-Based Cost Management in Government." He does a great job covering a wide range cost topics in a clear and coherent manner; and he consistently reinforces - through relevant concepts, examples and quotations - the pragmatic value of cost information to support fact based decision making.

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