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Practical difficulties in an installation of Costing System – CS Executive

Practical difficulties in an installation of Costing System –CS Executive

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The following topic “practical difficulties in an installation of costing system” for  CS preparation  is quite confusing topic to the student. It is explained below:-
Practical difficulties in an installation of Costing System
The major difficulties in the installation of a Costing System and the suggestions to overcome them are as follows:
  1. Lack of Support from Top Management
Often, the Costing System is introduced at the behest of the managing director or some other director without taking into confidence other members of the top management team. This results in opposition from various managers as they consider it interference as well as an uncalled check of their activities. They, therefore, resist the additional work involved in the cost accounting system.
This difficulty can be overcome by taking the top management into confidence before installing the system. A sense of cost consciousness need to be instilled in their minds.
2. Resistance from the Staff
The existing financial accounting staff may resist to the system because of a feeling of their being declared redundant under the new system.
This fear can be overcome by explaining the staff that the costing system would not replace but strengthen the existing system. It will open new areas for development which will prove beneficial to them. Read more...

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