A Research On The Activity-based Costing Application In Our Country Insurance Companys

The competition in our country's insurance industry is becoming fiercer and fiercer. What should China's insurance companies do to face the challenge and grasp the chance in the drastic competition becomes the primary question to be considered by managers and scholars. The management of cost becomes an important factor that influnce the development and profits of the company. ABC(Activity一based Costing) is a kind of advanced method of cost calculation and management. It can provide the objective, true and accurate cost information for the product and service in many cost allocation standards according to the avtivity cost driver. It is not only the base in calculating the product cost, but also a succesive management process. It is used for controlling the cost and other important calculating sector in the enterprise.The article first introduces the principle of ABCS(Activity-based Costing System) and the rationality of applying it in our insurance companys. In this part, it introduces the pattern of pricing the product in insurance companys and how to allocate the operating expenses and operating costs. The next is mainly about building ABC accounting system, which is the core of the paper. One use of the accounting books produced by the principle, from ABC accounting system design, books design and analysis system is designed to illustrate that ABC application is suitable to the daily management of enterprise. The end of this part uses a simulated case to prove ABC in product pricing on the scientific nature. Then there is an introduction at a higher level use of operating cost management to demonstrate that it is the further extension and development of ABC thoughts, mainly of the business operating cost management and strategic management of operating costs. The end of the article is the difficulties and focuses of ABC when applying in China's insurance business. It emphasizes that the application of ABC needs an internal environment and external environment with a comprehensive coordination and finally points out policy proposals at the end of the paper.