Higher Education Costing Methodology And Its Application

Cost-checking is an important part in the financial management of higher educational institutions. For many years, higher education is regarded as a kind of pure consuming enterprise, under the guide of which the financial management is only the budget of the income and expense without considering the cost. With the deeper development of socialist market economy, the demand for qualified personnel has impelled the fast development of higher education. A lot of changes has taken places in the higher education systems and the higher education in our country has turned from elite education to mass education. The requirement for more education funds resulted from the rapid development of higher education conflicts the supply of limited funds, which causes the increasing importance of optimizing education resources and improving the efficiency of education funds. More attention is paying on the existence and development of higher educational institutions. After investigation the author found that the shortage of funds is widespread in higher educational institutions while waste of resources also exists commonly. On one hand, it is caused by the present higher education system; on the other hand, it is the inevitable result of the weak management, especially the weak cost management. Higher educational institutions need enough education funds to improve teaching quality and conditions so as to guarantee their existence and development. From the point of view of curtailing expenditures it is necessary to reform the present higher education finacial systems. That is higher educational institutions shoud consider market, cost, efficiency, establish and strenthen cost-checking systems, reduce and stop education waste to improve efficiency. Cost-checking is a necessary choice for higher educational institutions, which plays not only an important role in relieving funds shortage but also reflects the objective requirement of the reform and development of higher education. And it is a subject both of theory and of pratice. The author referred to the latest researches in the area of higher education cost-checking at home and abroad and connected them closely with the practice in our country, tried to investigate the approaches and applications of higher educational institutes' cost-checking. This paper includes seven parts. The first part expounds the purpose and function of higher educational institutes' cost-checking, describes and commentates the current situations and introduces the main content, approaches and techniques of cost-checking. In the second part the author analyzes and sorts out the concerning basic definitions and illustrates the characteristics of higher educational institutions' cost- checking. The third part analyzes the current higher educational institutions' cost-checking in our country and points out the existing problems in this area. The forth part proposes the model of higher educational institutions' cost-checking by borrowing the cost-checking approaches in companies. The model defines the objects, scopes, peroids, principles, cost items, checking subjects, etc. and determines the allocating criteria and approaches of indirect education funds. The general procedures and approaches of higher educational institutions' cost-checking is generalized in the fifth part and how to calculate, sum up and allocate all kinds of education funds are explained. The checking is also demonstrated and the cost-control form is designed. In the sixth part the author takes Yancheng Institute of Technology, in which the author works, for an example to carry out case study and explores a feasible and scientific concrete approach of cost-checking in higher educational institutions. In addition the author analyzes the case and probes the means of decreasing higher education cost. The seventh part is summary and proposal, which comes to the conclusions and gives proposals. The purpose of this paper is that higher educational institutions can control unreasonable expenditures strictly, decrease waste and improve efficiency by means of cost-checking management and thereby push dramatic development of higher education in our country.