The Research Of EGSL Company For Improving The Level Of Cost Management

After China enters into WTO, Chinese economy is now walking toward the world, and the manufacturing develops rapidly. In order to achieve the maximum profit, the enterprises must rigorously manage and control the cost. The standard cost method as a systematic and scientific cost management method has the prominent effect to improve the level of cost management. However, this method has not been popularized completely in China. According to the investigation in 2001, there was only 18.1% enterprises introduced this method. Therefore, making use of scientific cost management method to carry through cost management is the only way for China being the world manufacturing center in the next 20 years.This thesis is on the basis of the author's work experience as financial analyst for years, and combines relevant theories of standard cost method. With the sample of EGSL Company, it studies on the value of standard cost method to improve level of cost management, which are mainly including: to analyze profit and loss, to establish controllable budget and to control the expenses, to improve material cost saving ratio and level of inventory management. Finally, this thesis concludes the advantages of cost management owing to introducing the standard cost method, while it also puts forward some imperfect places of standard cost method, therefore, people should refer to the activity-based cost method, total quality management and strategic cost management as the complementarity to the standard cost, thereby the standard cost method could be made more useful in the new manufacturing environment. The thesis also proposed to apply the standard cost method to the non-manufacturing enterprises by integration and computerization, on the basis of new understanding of the method it will be promoted in a large scale in China.