Cost Accounting
Accounts for and reports on the cost of products and services, applying standard principles of cost determination, allocation, and apportionment.
Level 1 Introductory: Demonstrates introductory understanding and ability and, with guidance, applies the competency in a few, simple situations. Can direct people to the appropriate source for further information.
BEHAVIORS
- Identifies the key elements of cost - materials, labor, and overheads - and how they interrelate.
- Articulates the basic principles of cost allocation and apportionment.
- Uses the organization’s cost allocation policy in basic transaction recording.
- Collects data for basic costing analysis.
QUESTIONS
- Describe a time when you were required to use the organization's cost allocation policy to record a transaction.
Probing Questions
* What was the transaction you were recording?
* How did the cost allocation policy apply?
* What other resources did you use?
* What was the result?
- Describe a time when you collected data for cost analysis.
Probing Questions
* Which costs were you collecting?
* What was your understanding of the analysis to be done?
* How did you determine which data to collect?
* What was the result?
Level 2 Basic: Demonstrates basic knowledge and ability and, with guidance, can apply the competency in common situations that present limited difficulties.
BEHAVIORS
- Performs various costing tasks, including stock control/valuation, material/job costing with moderate supervision.
- Assists with the generation of Cost Accounting analysis and product/service costing reports.
- Supports the achievement of predefined cost key performance indicators/targets.
- Follows the organization’s policy regarding cost allocation.
QUESTIONS
- Describe a time when you performed a cost analysis task, such as inventory costing or project costing.
Probing Questions
* What was the task you performed?
* How did you determine which costs to analyze?
* What other resources did you use?
* What was the result?
- Describe a time when you worked with cost key performance indicators or targets.
Probing Questions
* What was the indicator or target?
* What was your involvement?
* What resources did you use?
* What was the result?
Level 3 Intermediate: Demonstrates solid knowledge and ability, and can apply the competency, with minimal or no guidance, in the full range of typical situations. Would require guidance to handle novel or more complex situations.
BEHAVIORS
- Tracks, monitors, and communicates cost key performance objectives and targets for individual divisions and the entire organization.
- Communicates the organization’s cost allocation policies to users in non-financial terms.
- Analyzes and resolves day-to-day issues that might arise in the course of allocation and apportionment of costs across departments and divisions in the organization.
- Supervises stock/stores valuation and control and contributes to ensuring that an optimum stock level of materials is maintained.
QUESTIONS
- Describe a time when you had to explain cost allocation methods to non-financial managers.
Probing Questions
* How did you decide what information to provide?
* How did you structure your explanation?
* How did you respond to questions and challenges?
* What was the result?
- Describe a time when you had to resolve an issue regarding cost allocations.
Probing Questions
* What were your role and responsibilities?
* What were the circumstances?
* What information did you use to resolve the difference?
* What other resources did you use?
Level 4 Advanced: Demonstrates advanced knowledge and ability and can apply the competency in new or complex situations. Guides other professionals.
BEHAVIORS
- Coaches others on the relationship between key cost accounting concepts and cost elements.
- Manages the efforts of others in performing cost accounting tasks.
- Takes ownership of the end-to-end costing processes and is called upon to answer both process questions and questions relating to the basis of cost apportionment that might arise.
- Makes recommendations on alternate cost allocation policies and costing approaches.
QUESTIONS
- Describe a time when you made a recommendation regarding alternate cost allocation methodologies.
Probing Questions
* What were your role and responsibilities?
* How did you arrive at your recommendation?
* What were the impacts of your recommendation?
* How did you communicate your recommendation?
- Describe a time when you coached a group or an individual in the relationship between cost accounting and cost elements.
Probing Questions
* What were your role and responsibilities?
* Who were you coaching?
* What was their background or basic exposure to cost accounting?
* How did you go about coaching?
Level 5 Expert: Demonstrates expert knowledge and ability, and can apply the competency in the most complex situations. Develops new approaches, methods or policies in the area. Is recognized as an expert, internally and/or externally.
BEHAVIORS
- Is sought by others to answer questions and solve complex problems that might arise in determining the cost of jobs and services.
- Sets targets for each element of cost (material, labor overheads) for the various business units based on corporate objectives.
- Interprets the overall impact of adopting a particular costing approach on the business.
QUESTIONS
- Describe a time when you were required to make a decision on adopting a particular costing approach.
Probing Questions
* What were your role and responsibilities?
* What was the circumstance?
* What analysis did you perform?
* How did you make your decision?
- Describe a time when you set cost targets for a particular cost in order to achieve the organization's objectives.
Probing Questions
* What were your role and responsibilities?
* How did you determine the target to set?
* What other factors did you consider?