Ny Power Supply Cost Management System Study

Electricity market reform requires power companies to strengthen cost management. Currently, electricity-supply companies depends mostly on the overall budget management system, but the system mainly based on the provincial companies' demands, and it's difficult to meet the demands of the prefecture-level electricity-supply companies. At the same time, although prefecture-level electricity-supply company is not independent accounting entity, it has huge organizational system, so it's really a problem how to effectively manage it's cost. Therefore, how to establish a cost management system suit for prefecture-level electricity-supply company is an urgent and specific question.In order to solve the above problem, this paper regards the cost management system of NY Electricity-supply Company as the research object, and discusses how to establish an applicable prefecture-level electricity-supply company's cost management system based on NY Electricity-supply Company's condition using theories and methods such as strategic management theory, liability cost, standard cost and activity-based cost. The main contents are as follow:1. Proposed the basic principles should be followed in establishment of an applicable prefecture-level electricity-supply company's cost management system, which includes the principles of cost-effectiveness, importance, exception, co-ordination and controllability;2. Analyzed the stage of NY Electricity-supply Company's cost management system in the current conditions, the relationship between the cost management system established and the existing financial accounting system, and the basic steps in the establishment of the system;3. Established a cost management system of NY Electricity-supply Company, which includes the cost management system of production sectors and the budget management system of management departments, using relevant theory and methods, with focuses on the cost-drivers, standard-setting and variance analysis and other issues, and proposed some suggestions of the direction and methods to improve the system. This paper argues that the cost management system should be parallel with the financial accounting system in NY Electricity-supply company at this stage, and that the system should be targeted at controllable costs; in determining the cost standards, according to activity-based cost management theory, the cost should be breakdown by items, and cost-drivers should be determined and merged by items based on the actual situation, and the budget quantity of each cost-driver should be determined according to the strategic planning of the provincial power company and NY Electricity-supply company; in order to determine the standard rate of each cost-driver, it's necessary to review the financial information of each department of the company, and the standard rate should be calculated by adjusted cost and cost-drivers; and some of the cost items should be centrally controlled.Because the organizational structure, production and operation management system in prefecture-level electricity-supply companies all around China is similar to each other, The cost management system established in this paper has a high reference value.