Gas Industry Accounting

Project goal

To provide Accounting services for the reconciliation of actual costs to budgeted costs for in-house manufacturing processes.

Project details

The client, a gas and electricity utility, manufactured items that were sold to residential and business customers in batches, according to a workorder process. Though each item had a budgeted amount of time and materials, at the time there was no process for reconciling the amount of labour and materials actually used.

During the course of this assignment the consultant designed a process for recording the amount of time and quantities of materials used and reconciling those against the budgeted amounts for each item and workorder. The variances for each order for labour and materials were calculated and input into the organisation's mainframe system.

 

Project outcome

An entirely new system for reconciliation of actual costs to budgeted costs was delivered. Material variances, labour variances and the overall variance could then be tracked for each workorder. This provided greatly improved financial controls within this part of the organisation.