Control is one of the most significant activities in the complex directional process of the corporation, which enables to estimate achieved results , in order to adjust when it’s required.
The achievement of the module “control” integrates the management dimension with the operation one to achieve objectives concerning management, economic analyses of profitability and performances, by planning data for a reporting which adapts to client’s needs.
Si5 functions enable to develop analysis on three different dimensions :
ANALYSIS OF VALUES : it controls economic, proprietary and financial values of operational units. This module analyses nature and destination of costs and receipts and their impacts both financial and proprietary. Accounts and corporate analyses of operational units are produced and account information of the cost center are obtained, such as defining the hourly rate of functioning production cost centers, in order to enable valorization of transformation.
ANALYSIS OF PRODUCT COSTS: it is possible to calculate the cost of the product by attributing direct components and allocating the indirect through appropriate drivers. The calculation is made through a parametric structure enabling at the same time to build different cost models. The integration with analysis of values enable to correlate CDC production rates with the type of expenses attributed to them, in order to make indirect costs absorption coherent with product valorization. In this module it is also possible to elaborate standard costs.
OPERATIONAL ANALYSIS : it deals with control on elementary dimensions, and related logic aggregates of the corporate operation activities. Analyses deal with information relating to objects and quality of single events, to resources and processes, to the use of factors and the attribution of single operations to specific analysis dimensions, by using an efficient multidimensional accounting per objectives.
The results achieved are :
Integration with operation and management areas sharing management and financial information.
Ability of correct and flexible calculation of costs with traditional models, such as analysis per objective and ABC
Budget planning by sharing industrial information and with the possibility to organize environments for background analysis
Reducing times for closures and planning of period report, in complex and multinational backgrounds as well
Better estimation of profitability of different products and different departments thanks to the availability of standard cost
More convenient allocation of available resources (financial and physical)
Improving decision-making process thanks to availability of accurate and detailed information
Management of control analyses seeking business intelligence
From a methodological point of view, the module “control” is based on the following principles :
o Achievement of analytic accounting, with the aim of gathering information required for achieving corporate results. Through this tool it’s possible to analyze natures and destinations of costs seeking to :
o Provide the organizational components with the corresponding elements from balance sheet,
o Measure performances of organizational components according to results assigned to them,
o Obtain an analysis of information for each business area,
o Calculation of product cost, through a mechanism synthetizing cost information gathered by analytic accounting and interacting with industrial information to come to accounting entries on the unitary basis of costs. Through this mechanism it’s possible to process different costs responding to the different needs of analysis and use. It’s also available the generation and treatment of the standard cost.
o Measurement and control of corporate processes, with the aim of identifying economic-financial dimensions on the basis of which it’s possible to generate a model for corporate performances. The aim is to integrate traditional analysis which are merely monetary with quantitative and qualitative components of analysis concerning corporate objectives.
o Generation of a report analyzing processed information and correlation between budget forecasts and final budgets. Reporting has the specific aim of achieving the following analyses:
o Analysis of gathering objects to identify results and discrepancies
o Analysis of variances
o Analysis of profitability of both products and operations
o Analysis of results of each unit
o Analysis per index
o Analysis of the generation of value
Management Reporting enables to achieve synthesis tools following two models :
o Corporate control panel
o balanced scorecard
The application scheme of control system is represented by the following stages/applications :
o Basic Data and rules of operation
o Budget:
o Income statement
o Investments
o Finance
o Property
o Calculation of product costs
o Processing final budget
o Processing Income statement
o Management Reporting
Each stage will be set up according to a different level of attention based on the set up model. In defining requirements, these different conditions for the use will be highlighted.
Parametric management cost
In Si5 functions concerning the calculation of the product represent the integration of administrative and industrial information with the application gathering data from control to the model of products represented by information of BOM and cycle.
Different typologies of cost can be directly parameterized by users, such as :
o last
o average (management and tax system)
o standard (di budget e current)
Previous typologies of cost can be processed monthly, excepted from budget standard cost processed once a year.
For each item and for each typology it’s possible to fix :
o value added cost corresponding to its own level of BOM ( for purchases it’s the purchase cost, for production is transformation cost, for subcontract it’s the subcontracting cost )
o The total cost corresponds to value added cost + components
o Consolidated cost which can be used when parts are supplied by other plants. It corresponds to transfer cost without “make-up”. It’s the final cost calculated with the values of production plant.
o The cost is divided into 24 cost elements which can be parameterized pilotable through formulas such as :
o Material cost
o Transformation cost
o Subcontracting cost
o Accessory purchase fees
o Custom expenses,
o etc.
These elements can be grouped in different ways in order to give a representation of cost satisfying needs of both production and administration functions. Costs processing can be carried out through a batch procedure for all elements of the master file or online for each single part. In this case, it’s possible to recalculate components cost. At the end of processing it’s highlighted what changed from the current value and the new value can be memorized to replace the ancient.
Costs can be memorized for each month according to :
o Total cost
o 24 cost elements
o Detail of material costs for each wares class ( management or purchase)
o Detail of transformation costs for each department Cost Centre or Work Centre. In this case costs aren’t memorized, whereas unit times (man or machines) and preparation times are.
o It’s possible to process cost by varying the origin and date or the progression of validity. The system will use BOM and the cycle operations which are valid at the chose date.
The procedure for costs includes, during every processing, the generation of a list of anomalies and the definition of their level of seriousness.
Fiscal Costs: LIFO FIFO MEDIO
In Si5 functions concerning the calculation of the product represent the integration of administrative and industrial information with the application gathering data from control to the model of products represented by information of BOM and cycle.
Different typologies of cost can be directly parameterized by users, such as :
o last
o average (management and tax system)
o standard (di budget e current)
Previous typologies of cost can be processed monthly, excepted from budget standard cost processed once a year.
For each item and for each typology it’s possible to fix :
o value added cost corresponding to its own level of BOM ( for purchases it’s the purchase cost, for production is transformation cost, for subcontract it’s the subcontracting cost )
o The total cost corresponds to value added cost + components
o Consolidated cost which can be used when parts are supplied by other plants. It corresponds to transfer cost without “make-up”. It’s the final cost calculated with the values of production plant.
o The cost is divided into 24 cost elements which can be parameterized pilotable through formulas such as :
o Material cost
o Transformation cost
o Subcontracting cost
o Accessory purchase fees
o Custom expenses,
o etc.
These elements can be grouped in different ways in order to give a representation of cost satisfying needs of both production and administration functions. Costs processing can be carried out through a batch procedure for all elements of the master file or online for each single part. In this case, it’s possible to recalculate components cost. At the end of processing it’s highlighted what changed from the current value and the new value can be memorized to replace the ancient.
Costs can be memorized for each month according to :
o Total cost
o 24 cost elements
o Detail of material costs for each wares class ( management or purchase)
o Detail of transformation costs for each department Cost Centre or Work Centre. In this case costs aren’t memorized, whereas unit times (man or machines) and preparation times are.
o It’s possible to process cost by varying the origin and date or the progression of validity. The system will use BOM and the cycle operations which are valid at the chose date.
The procedure for costs includes, during every processing, the generation of a list of anomalies and the definition of their level of seriousness.
Budget
The process of budget enables the firm to find and define its own objectives of fonctionning and results for the future. Through this process it’s mandatory to produce a complete balance sheet for the future business, made of balance statement and property which are one of the greatest objectives sought by management.
Analysis are oriented to short term which means current budget, used to analyse how business is progressing and budget referred to future business.
The system enables as well to produce and manage budget of the years afterwards and to arrange long-term budget analyses.
As indicated when defining the developpment flow of the product, the process of budget is organized in the following stages :
- Balance Statement
- Investments
- Finance
- Property
