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Course Introduction © Dale R. Geiger 20111
Even Super Powers Can Lose a Cost War Kamchatka Peninsula, Russia Aral Sea, Kazakhstan Soviet military installation Paldiski, Estonia © Dale R. Geiger 20112
Terminal Learning Objective Task: Introduce Principles of Cost Analysis and Management Condition: You are cost advisor technician with access PCAM course handouts, readings, and spreadsheet tools and awareness of Operational Environment (OE)/Contemporary Operational Environment (COE) variables and actors Standard: With at least 80% accuracy: Discuss purpose for increasing cost effectiveness; terminology, and best practices response to threat Understand the Purpose of this Course Understand the asymmetrical threat of lack of resources. © Dale R. Geiger 20113
Cost Maturation Process Single Use Estimated Future Cost Cost Benefit Analysis Cost Informed Decisions Single Use Estimated Future Cost Cost Benefit Analysis Cost Informed Decisions Persistent Use Expected and Actual Cost Continuous Improvement Cost-Managed Organizations Persistent Use Expected and Actual Cost Continuous Improvement Cost-Managed Organizations Universal Use Planned & Actual Cost Role Based, Org Based, Output Based Control Cost-Managed Enterprise Universal Use Planned & Actual Cost Role Based, Org Based, Output Based Control Cost-Managed Enterprise Cost War Cost War High Cost War Full Insurgency Intensity Conflict Spectrum Operations Starting here (Some work is being done now) TARGET © Dale R. Geiger 20115
Check on Learning What are the three stages of the Cost Maturation Process? Where is the Army now in the process? © Dale R. Geiger 20116
Transforming the Army: Four Requirements for Success Transforming the Army: Four Requirements for Success Need Status Action Leadership Team with ACE* to create informed leaders Exploit existing strong leadership capabilities ACE Build strong staff, strong organization Select, develop ACEs (*Asst to Comdr – Enterprise) Design and deliver advanced training Process Modify winning the cost war template as needed Cost Info Use new tools as they come online © Dale R. Geiger 20117
Principles of Cost Accounting and Management Targeted at entry level CP11 Personnel, Sergeants, Lieutenants, Junior Captains Course Length: Three Weeks Pre-requisites: On Line Math Refresher Intermediate Cost Accounting and Management Targeted at mid career CP11 Personnel, Staff Sergeants and above, Senior Captains, Majors and above Course Length: Three Weeks Pre-requisites: On Line Math Refresher ACE Development: PCAM & ICAM © Dale R. Geiger 2011 8
All CEs will require basic, advanced, and master skills with a concentration in: Readiness – Capacity management and force cost analysis Materiel – Logistics and working capital funds cost analysis Human Capital – Manpower cost analysis Services & Infrastructure – Services and capital asset costing FAs and CPs that are common to all CEs should train to become a master in any CE Stackable Credentials * NOTE: Stackable credentials are based on Financial Management (BC36/CP11) career field demands for cost management, which is the Army maximum; other career fields will use a subset of these requirements. Based on the Financial Management Career Field © Dale R. Geiger 2011 9
PCAM Develop basic cost management skills First step in becoming an ACE © Dale R. Geiger 201110
Purpose of Course Develop Skills in Cost Accounting Includes Conference, Demonstration and Practical Exercises Emphasizes hands-on experience Introduces Excel templates to facilitate learning Introduce and Apply Skills in Cost Management Case studies give students the opportunity to apply their skills to a real-world scenario © Dale R. Geiger 201111
Overview of Course Week 1: Basic Accounting Principles: External Reporting Accounting Basic Training Military Fund Accounting Financial Accounting Cost Accounting: External Reporting Test Days 1-4 Managerial Cost Intro Basic Financial Statements, Cash-based Accounting Budgetary Accounting, Obligations & Expenditures Accrual Accounting Basics – Revolving Funds Accounting for Manufacturing, Job Order Costing Cost Terminology, Relevant Cost Decisions © Dale R. Geiger 201112
Key Issues for Week 1 Internal vs. External Reporting Different ways of measuring costs for external reporting Measuring and reporting the cost of a job Defense contractor costing How to use and interpret different types of information prepared for external users © Dale R. Geiger 201113
Expectations There are lots of different methods to account for costs The goal of this course is to create awareness of the different methods Students are not expected to become experts but should understand where each method is used and why © Dale R. Geiger 201114
Overview of Course Week 2: Cost Relationships and Cost Tradeoffs Cost Relationships I Cost Relationships II Activity Based Costing Cost Tradeoffs I Test Days 5-9 Cost Tradeoffs II Fixed, Variable, Linear and Non-linear relationships Net Present Value and Expected Value Allocation Mechanics, Cost Driver Selection, Pitfalls Breakeven Analysis, Sensitivity, Indifference Points I Batch Quantity Tradeoffs, Indifference Points II © Dale R. Geiger 201115
Key Issues for Week 2 Identify and express cost relationships Evaluate investment courses of action using net present value and expected value Identify behavioral issues with cost measurement Explain the concept of cost tradeoff and identify points of indifference © Dale R. Geiger 201116
Overview of Course Week 3: Cost Planning & Explanation, CBA Cost Planning and Estimation Cost Benefit Analysis Cost Explanation Winning the Cost War After Action Review Final Exam Flexible Forecasting, Trend Projection, Learning Curve Eight Steps to Cost Benefit Analysis Variance Analysis and Reconciliation Prepare After Action Review Briefing from Case Study Comprehensive Final Exam, Closing Activities © Dale R. Geiger 201117
Key Issues for Week 3 Tools for cost planning and projection Cost Benefit Analysis Cost explanation and After Action Review © Dale R. Geiger 201118
Check on Learning What is an ACE? © Dale R. Geiger 201119
Remember Valley Forge Read the article by Ms. Matiella © Dale R. Geiger 201120
Check on Learning Why does the Army need to become more cost effective? What is the difference between Cost Benefit Analysis and a Cost-Managed Organization? How do fiscal constraints pose an asymmetric threat? How should we respond? © Dale R. Geiger 201121
$ $ Budget Appropriated Manage ment Better Mission Execution $ $ $ $ Reprogrammed Efficiencies $ $ Payoff: Better Execution, Not Necessarily Less Spending © Dale R. Geiger 2011 22
Course Introduction/ Determine the Difference Between Internal and External Reporting © Dale R. Geiger
Determine the Implementation Requirements for Cost Management and Control © Dale R. Geiger
Closing Remarks © Dale R. Geiger Congratulations!! On completing the most mathematically rigorous course in the Army Financial Management School.
Explain the Impact of Poor Cost Information © Dale R. Geiger
Project Sales or Production Levels Using the Rolling Average ©
Explain Change in Financial Position Over a Period of Time © Dale R. Geiger
Explain Changes in Net Position © Dale R. Geiger
Define Governmental Operating Activities © Dale R. Geiger
Determine the Difference Between Internal and External Reporting © Dale R. Geiger
Verify Unit of Measure in a Multivariate Equation ©
Calculate Spending and Efficiency Variances ©1. Why So Much? ©2.
Organization Based Control – Childcare Case Ft. Riley © Dale R. Geiger
Determine The Purpose And Motivation For Managerial Costing © Dale R. Geiger, 2011 Used by Permission 1.
The Envelope System © Dale R. Geiger Questions to Consider Does “the Government” overspend its budget? Who decides how much to spend? How do managers.
Welcome To Accounting 1C “Principles of Managerial Accounting” Mark Martinelli “Now where do I find my course green-sheet?”
INTRODUCTION TO COST MANAGEMENT DASA-CE Training.
Future Research Leaders Program Module 5 Financial, Resource and Risk Management.
The Change Implications for Organisation Systems and Structures ©TPP
Transaction Analysis © Dale R. Geiger Terminal Learning Objective Action: Demonstrate How Transactions Affect the Accounting Equation Condition:
Calculate Financial Position © Dale R. Geiger
Demonstrate How Transactions Affect the Accounting Equation © Dale R. Geiger
Calculate Point of Indifference Between Two Cost Scenarios 1.
Explain Causes of Variances with the Reconciliation Format ©1.
Complete Steps 1-3 in Accounting Cycle © Dale R. Geiger
Calculate Volume And Performance Variances © Dale R. Geiger
Calculate Economic Order Quantity © Dale R. Geiger
Identify Sensitive Variables © Dale R. Geiger
DEVELOPING A RESULTS-ORIENTED MANAGEMENT FOR DEFENSE R&D, AS A PART OF THE IMPROVEMENT OF BULGARIAN DEFENSE RESOURCE MANAGEMENT’S TECHNOLOGY COL. DOBROMIR.
In Tune with Army Financial Management Cost Awareness of Financial Operations in Theater Army Day 2010 June 2, 2010 June 2, 2010 Steve Bagby - MG Phil.
Calculate Schedule and Cost Variances with Earned Value Analysis © Dale R. Geiger
Calculate Cost of Goods Manufactured © Dale R. Geiger
Calculate Volume and Performance Variances ©1. What Does it Mean?? 37 Best in class or worst? Best in class or worst? 37 out of 100? or 37 out of 37?
MANAGEMENTS DISCUSSION & ANALYSIS NMASBO Fall Conference 2012 Taos, New Mexico Presented by Leslie Smith, Retired Business Manager.
Electronic Management of Environmental Analytical Data Anand Mudambi USEPA National Environmental Monitoring Conference 2011 August 16, /16/20111.
Complete All Steps In The Accounting Cycle © Dale R. Geiger
Recommend A Course Of Action In Outsourcing And Keep Or Replace Decisions © Dale R. Geiger
West Prior and STR 1© The Delos Partnership 2005 Integrated Enterprise Leadership Priority and Senior Team Reviews.
Identify Similarities Between Battlefield Management And Cost Management © Dale R. Geiger
Strategic Planning. Agenda Icebreaker Welcome and Introductions Agenda Review What is Strategic Planning Types of Strategic Planning Planning to Plan.
Calculate A Production Plan With The Inventory Chain Template © Dale R. Geiger
LARGE SYSTEMS IMPLETATION PROCESS Overview Review process diagram homework practice.
1 Budgets and Budgetary Control Prepared and Presented By Gladstone K. Hlalakuhle.
PATHWAYS TO IMPROVING BUDGET IMPLEMENTATION BUDGET MANAGEMENT AND FINANCIAL ACCOUNTABILITY COURSE THE WORLD BANK MARCH 1, 2004 ALLEN SCHICK.
Lecture 32 An overview of Topics. Chapter 01 Businesses, Multinational Corporations and Basics Concepts of Accounting.
Estimate Future Costs Given Planning Factors © Dale R. Geiger
Calculate Breakeven Point © Dale R. Geiger
Apply Change Management Principles to Gunfire at Sea Case Study.
© 2009 Factory Strategies Group LLC. All rights reserved. Manufacturing Cost Accounting Enterprise Excellence Series.
Course costing… Dr Thomas Loya, Director Planning and Management Information University of Nottingham HESA: Process Benchmarking Seminar – June 2011 and.
Accounting/Finance Ms. Egyirba Walker-Arthur Accounting/Finance Program Manager
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