April 11, 2008, Newsletter Issue #74: Director of Cost Accounting

Tip of the Week

A Cost Accounting Director is the highest position one can obtain in the cost accounting field. They usually report to the VP of the firm. The duties and responsibilities of the cost director vary according to the firm size. In general, the Cost Accounting Director can perform some of the following:
Coordinate cost accounting activities with Management Engineering, Reimbursement and Financial Planning and AnalysisEstablish and maintain labor and non-labor cost standards (in coordination with Management Engineering)Prepare reports explaining overhead variances; compile cost data used in developing budget proposalsAnalyze direct and indirect costs to determine proper allocation for recording cost elementsSupervise comparative analysesMaintain accounting software systemDetermine accuracy of distribution of labor, material, and overhead charges, trace discrepancies to sourceCompare and analyze actual direct and indirect charges to budget allowances on continuing basisAudit cost reports, determine causes of performance variances, compare to budget allowancesPerform volume and rate variance reporting; perform other duties as needed by management.
In addition, the Cost Accounting Director usually trains staff members, is involved in personnel changes such as termination, hiring, promotions, transfers, etc. Cost Accounting Director usually is expected to have 5-10 years experience in the accounting and/or cost accounting field. An advanced degree is preferred. A CPA or CMA is usually required.

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