Publication: Activity based costing and an application on Turkish banking system
Abstract
AKTİVİTE BAZLI MALİYETLENDİRME ve TÜRK BANKACILIK SİSTEMİNDE BİR UYGULAMA Çalısma; faaliyet tabanlı maliyet sisteminin avantajlarını, dezavantajlarını ve uygulama alanlarını tartısmaktadır. Bunun için çalısmada kurumsal krediler bir örnek olarak kullanılmıstır. Faaliyet tabanlı maliyet sistemi geleneksel maliyet metotlarının yarattığı problemlerin bazılarını çözmek için gelistirilmistir. Firmaların daha karmasık servis, ürünlere ve daha fazla sabit maliyetlere sahip olmasıyla beraber geleneksel maliyet yöntemleri daha az faydalı hale gelmislerdir. Bu yüzden, isletmecilere giderleri doğru olarak hesaplama olanağı veren faaliyet tabanlı maliyet sistemi önem kazanmaya baslamıstır. Bunun yanı sıra faaliyet tabanlı maliyet sistemi servis ya da ürün ve müsteri karlılığını hesaplamayı mümkün kılmaktadır. Bu sebeplerden dolayı hem imalat hem de finans firmaları faaliyet tabanlı maliyet sistemini seçmislerdir. Arastırmada bir banka subesi, giderleri incelenmek üzere bir örnek olarak ele alınmıstır. Kredi verilme hizmeti ana örnek olarak seçilmis ve buna bağlı aktiviteler analiz edilmistir. Daha sonra, her bir aktivitenin birim maliyetine bakılarak giderler hesaplanmıstır. Çalısmanın sonuçları aktivitenin hacmine bağlı olarak giderlerin faaliyet tabanlı maliyet sistemiyle daha ii doğru ve kesin olarak ölçülebileceğine isaret etmektedir. Dolayısıyla, büyük bir finansal firmada da faaliyet tabanlı maliyet sistemi kullanmak faydalıdır ve isletmecilere daha doğru gider tespit imkanı vermektedir.
ACTIVITY BASED COSTI G A D A APPLICATIO O TURKISH BA KI G SYSTEM The research discusses the advantages, disadvantages, and the implementation of the activity based costing systems. In this study corporate credits are used as a case study. Activity based costing system has been developed to resolve some of the problems that the traditional costing methods generated. As the companies started to have considerable overhead costs and complex services and products, the traditional costing methods became less useful. Thus, activity based costing system began to gain importance since it enables the managers to accurately calculate the costs. Besides, the activity based costing system gives an opportunity to estimate the service or product and customer profitability. For these reasons both manufacturing and financial firms chose activity based costing system. In the research, a bank branch has been used as a case study to analyze the costs. Corporate credit is taken as an example and the activities associated with it are carefully examined. Then, the costs are calculated given the unit costs of each activity. My results suggest that depending on the volume of the activity; the activity based costing system could give more precise measures. Therefore, it is important to implement activity based costing management in a large financial organization. iv CO TE TS Page Özet i Abstract iii Contents iv List of Tables vi List of Figures vii List of Acronyms viii 1. I TRODUCTIO 1 2. DEFI ITIO A D DIFFERE CES OF ACTIVITY BASED COSTI G 4 2.1. Definition of the System 7 2.2. Historical Development of the System 18 2.3. Classical Cost Systems 23 2.3.1. Account Analysis 25 2.3.2. Engineering Approach 26 2.3.3. High-Low Approach 27 2.3.4. Linear Regression Analysis 27 v 2.4. The Differences between ABC and Classical Cost Systems 28 3. THE ACTIVITY BASED MA AGEME T, ITS IMPLEME TATIO , ADVA TAGES A D DISADVA TAGES WHE COMPARED WĐTH THE TRADITIO AL METHODS 36 3.1. Definition of Activity Based Management 36 3.2. Implementation of Activity Based Management 43 3.3. The Advantages and Disadvantages of Activity Based Management 46 4. ACTIVITY BASED COSTI G I BA KI G SECTOR 51 5. A APPLICATIO OF ACTIVITY BASED COSTI G I BA KI G SECTOR 60 5.1. Departments and Activities 62 5.2. An Example of Corporate Credits Activities’ Allocation 71 6. CO CLUSIO 78 REFERE CES 82
ACTIVITY BASED COSTI G A D A APPLICATIO O TURKISH BA KI G SYSTEM The research discusses the advantages, disadvantages, and the implementation of the activity based costing systems. In this study corporate credits are used as a case study. Activity based costing system has been developed to resolve some of the problems that the traditional costing methods generated. As the companies started to have considerable overhead costs and complex services and products, the traditional costing methods became less useful. Thus, activity based costing system began to gain importance since it enables the managers to accurately calculate the costs. Besides, the activity based costing system gives an opportunity to estimate the service or product and customer profitability. For these reasons both manufacturing and financial firms chose activity based costing system. In the research, a bank branch has been used as a case study to analyze the costs. Corporate credit is taken as an example and the activities associated with it are carefully examined. Then, the costs are calculated given the unit costs of each activity. My results suggest that depending on the volume of the activity; the activity based costing system could give more precise measures. Therefore, it is important to implement activity based costing management in a large financial organization. iv CO TE TS Page Özet i Abstract iii Contents iv List of Tables vi List of Figures vii List of Acronyms viii 1. I TRODUCTIO 1 2. DEFI ITIO A D DIFFERE CES OF ACTIVITY BASED COSTI G 4 2.1. Definition of the System 7 2.2. Historical Development of the System 18 2.3. Classical Cost Systems 23 2.3.1. Account Analysis 25 2.3.2. Engineering Approach 26 2.3.3. High-Low Approach 27 2.3.4. Linear Regression Analysis 27 v 2.4. The Differences between ABC and Classical Cost Systems 28 3. THE ACTIVITY BASED MA AGEME T, ITS IMPLEME TATIO , ADVA TAGES A D DISADVA TAGES WHE COMPARED WĐTH THE TRADITIO AL METHODS 36 3.1. Definition of Activity Based Management 36 3.2. Implementation of Activity Based Management 43 3.3. The Advantages and Disadvantages of Activity Based Management 46 4. ACTIVITY BASED COSTI G I BA KI G SECTOR 51 5. A APPLICATIO OF ACTIVITY BASED COSTI G I BA KI G SECTOR 60 5.1. Departments and Activities 62 5.2. An Example of Corporate Credits Activities’ Allocation 71 6. CO CLUSIO 78 REFERE CES 82