Explain why need in an innovation of cost accounting

First steps in changing of education

       After democratic revolution by 1990 all social & economic basic fundamentally changed in my country, especially in education. Earlier we mainly studied under education philosophy of socialistic countries. Between1990-2010 established private owned around 150 colleges & institutions in addition to 6 state universities which were founded previously. Academic understanding & practical activities started basing on foreign education experience, particularly some fundamental, well-known textbooks of Western countries translated into home language, herein authorities have applied to Asian development bank to accept appropriate contribution in training of economics subjects as essentials of accounting, as well as cost & management accounting. Lecturers & scholars at state owned universities entirely have covered with advanced courses in line of their lecturing & researching in home country & abroad.

What happened in practice?

      Since end of 1999 I have stated to give lectures at private college, indeed my new job of lecturing at college was for my very difficult, I have to prepare lecture’s file & manage seminar myself without other’s assistance. But however I have got over troubles successfully, to which significantly affected my applied mathematical knowledge & statistical mathematical experience possessed in accounting practice before. When I was giving lectures on cost accounting I observed that impossible to continue using textbooks published 10-20 years ago in English as well as Russian edition in which illustrated mainly direct calculation methods to solve any pending problems no applying to mathematical approaches. Meanwhile I have decided to develop newly direction in accounting based in applied mathematics & mathematical statistics, & I primarily have released modern textbooks in two volumes, Cost accounting, & Management accounting. Several  times I have give speech with presentation in line of offered with me researching topics at science conferences for  economics institution's & college’s lecturers, which called account of many researchers. I & my family members continued & extended scope & steps of researching. Many suggested methods which referred to cost & management accounting, also abstracts of financial analyzing fond 3-4 different ways to get the same accuracy result.

Do you have confidence in feasiablity of your offered methods?

      I reply at once “Yes” if anyone asks me the above cited question. For period,1990-2010, we had continued university's education as before, under socialistic style & it based further on knowledge importation, translated textbooks, copied materials from internet communication. But however I do not like ignore many positive effects in globalization of education. We began studied from alphabets of market economy, indeed following terminologies,  as debt notes, bond, money time value, leasing, cost processing, shareholders, equity, bankruptcy, solvency, private owned enterprises etc which were unknown for us still. I personally wanted to  change traditional economics university's training policy, I am as being common accountant, considered curriculum, training plan, translated from foreign language essential textbooks, case materials which followed at financial-accounting college education.

Innovation of lecture file had began in cost accounting subject

      I have decided to prepare lecturing files of cost accounting subject according to my individual intuition & previously accumulated knowledge. Indeed I started thinking of changing Economics University’s education since early period when I was studied in Russia as student. After graduating institute of economics I have published periodically articles on feasibility of application of mathematical & statistical modeling in finance & accounting in professional journals.  I trust, I am first researcher who put new idea into topic of variance analysis on manufacturing overhead, which calls real account of researchers as very difficult theme of accounting. Sometimes learners say that, occur troubles to simplify understand, and quick memorize also use in practice when refer to study variance analysis of mixed costs illustrated in many well-known fundamental textbooks issued by famous universities. Taking into account this situation I have decided to create new analytical methods of allocation, isolation, budgeting, behavior forecasting, controlling, empiric analyzing of mixed expenses (manufacturing overhead, operating expenses-general administrative & marketing). The methods created with me have following obvious differences & appreciable advantages over other methods are using at present time in training:

·         Possibility to describe cost behavior through simple straight linear equation:

y = a +b x.

·         Possible to calculate & explain each factor (fixed cost & variable cost separately) of cost isolation affected to cost variances simply, understandable, & mathematically.

·         Application of stepwise elimination of each dimension in order to determining affects as two variance (controllable variance & volume variance), than on basis of that further calculation of four variance (spending variance, idle capacity variance, variable efficiency variance & fixed efficiency variance).

·         To reach the same accurate result using 2-4 applied mathematical & statistical methods in parallel. For instance to compute two & four variances we used above cited stepwise elimination of each dimension & in addition to that differential calculation method.

·          Affordable to further develop & extend herein cited analyzing methods in other topics of cost & management accounting subjects, for example in standard costs variance analysis of factory overhead, direct labor & direct materials etc.

·         Also we offered very interesting & unique method of variance analysis on factory overhead with comparing levels of budgeting, standard & actual in one calculating table simultaneously.