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1. The cost accountant should be able to provide for the other members of the design team a running series of cost estimates based on initial designs sketch, activities based costing reviews of production processes, and “best guess” costing information from suppliers based on estimated production volumes. Essentially in the earliest stages of a design, the cost accountant works with vague costing information and so must be able to provide estimates within a high-low range costs, gradually tightening this estimated cost range as more information becomes available.
2. The cost accountant should also be responsible for any capital budgeting requests generated by the design team since he or she has the knowledge of the capital budgeting process, how to fill out the required forms, and precisely what types of equipment are needed for the anticipated product design. The cost accountant also becomes the key contact on the design team for answers to any questions from the finance staff regarding issues or uncertainties in the capital budgeting proposal.
3. The cost accountant should work with the design team to help it understand the nature of various costs (such as cost allocations based on an activity-based costing system), as well as the cost-benefit trade-offs of using different design or cost operations in the new product.
4. In addition, the cost accountant is responsible for tracking the gap between the current cost of a product design and the target cost that is the design team’s goal, providing an itemization of where cost savings have already been achieved and where there has not been a sufficient degree of progress.
5. Finally, the cost accountant must continue to compare a product’s actual cost to the target cost after the design is completed, and for as long as the company sells the product. This is a necessary step because management must know immediately if costs are increasing beyond budgeted levels and why these increases are occurring.
copy paste from ICAI books of ca Final (New Course) " Strategic Cost Management and Performance Evaluation"
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