No matter what business setup an organization has, there are basic problems associated with cost control, monitoring and accounting.
Cost Controlling is one of the most challenging aspects managers face. Most times, during any project there are problems with project control and record keeping. This is because of poor compliance with best practices and lack of tools for recording financial transaction and progress reporting. Managers find it hard to interpret project accounts because they are not straightforward. Interpretation of project accounts is very important for project management with best practices.
The ideal way to ensure effective cost control is to plan business processes accurately and estimating the costs with margins. Changes can happen during the course of the process which results in failure of compliance with best practices. An additional challenge manager’s face is ensuring integration of information. However, with best practices this problem can be tackled easily. This requires best practices in:
Monitoring the entire setup involves regular assessment of best practices in compliance with the requirements for cost control. Monitoring means overlooking the entire processes involved in the business. It could be documentation, investing, purchases and sales. This also requires best practices like regular updates on schedules and budget controls. Furthermore, managers need to relate with information on cost and schedule to ensure compliance management as a best practice. This also helps in decision making and risk management.
Accounting in any organization can be challenging if there is poor compliance with best practices. In order to establish a standard accounting system, there is need for proper cost control and a proper accounting system. There must be best practices during the entire process of production or provision of services. This includes proper documentation of transactions involved in purchases, loans and credits. Financial statements must be monitored, audited and reviewed regularly to ensure that there is no omission of data.
Maintaining cost controls, ensuring best practices in monitoring and ensuring proper accounting requires a detailed set of protocols. Failure to comply with these protocols always leads to risks and losses. Therefore, compliance with best practices is a very challenging activity for managers.