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Capability
to handle and process detailed resource utilization studies for every
natural classification of expense for all departments, direct and/or
indirect (overhead)
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Reconciliation
of identified expenses to actual financial statements
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Internal
indirect cost allocations to both the departmental and service levels. This
is very important, since the indirect expenses allocated to the departments
often exceed their direct expenses. The allocation of these expenses to the
departments and to the services is a critical point in monitoring full
costing and is often not given the detailed review it deserves.
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Ability
to maintain a very large number of statistical bases for allocating costs
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Updating
of information quickly. The cost accounting system should interface with the
other financial systems software operating on the same hardware, thus
eliminating a second manual entry of current financial information.
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Interface
with the case-mix system. The cost accounting system should be able to pass
cost information to the case-mix system (which ideally would accept five
cost fields per service: direct, indirect, fixed, variable and total) and
accept information from the case-mix system to review profitability of
service and cost variances from standard.
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Budget
system interface – preferable flexible project line budgeting.
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Support
of multi-unit users on the same system
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Ability
to support both standard and allocated costing methodologies for all
services.
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Variance
reporting –reports comparing standard and actual costs and corresponding
variances
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Base
data file – a file that contains resource utilization study information
from national averages or standards, to be used to allocate costs to those
services not directly studied.
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Grouping
or “roll-up” feature – allows for easy comparison of departments and
administrative responsibility areas as well as inter-unit comparisons, etc.
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Extensive
security features – identifying and limiting users as desired.
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Data
entry ease. A data entry person should be able to enter the information
directly from input forms.
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General
ledger reclassifications – should allow reclassifications inter- and
intra-departmentally
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Support
of fixed, variable, and semi-variable classification of expenses by
department
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Rapid
recalculation response time. You should be able to recalculate entire
organization information or each department individually within a very short
time period
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Maintenance
of the organization wide cost accounting information base within the
singular system. The cost accounting system should support the whole
organization’s cost information base. Avoid systems that have only the
capability to maintain departments as separate entities.
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Updating of information in real time.
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Ability to report detailed
resource utilization studies for every classification of expense for all
organizational units, including:
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direct and indirect costs
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restricted and non-restricted
costs
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fixed, variable, and
semi-variable costs
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“what if costs.”
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Ability to allocate all costs to the very smallest service level.
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Ability to have the flexibility
to draw on different methods for allocating costs and to be able to develop
what-if scenarios.
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Ability to adjust budgets
manually by each period as well produce variance reports –reports
comparing standard and actual costs and corresponding variances
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Ability to perform comparison
analysis not only within the same classifications of units within the
organization but also outside the organization such as industry averages
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Ability to “drill down”
through multiple dimensions (departments, units, employees, service costs,
etc) as well as the time dimension