University leaders should not view cost management as an accounting process but as
a strategic tool that provides them with information and feedback which helps them to
set goals and track progress towards their attainment in an environment of intensifying
competition.

Several Universities within Australia have investigated the potential to be gained from use of Activity Based Costing (ABC) methodologies. This paper provides some insight as to how the ABC methodology can be used in Universities (particularly in the Properties / Facilities area) and the advantages and disadvantages, as identified by the Australian National Audit Office. In addition, the paper will look at the natural extension of ABC in the budgeting area; Activity Based Budgeting (ABB).

This white paper was developed to provide an argument for developing cost and performance models in an on-demand environment with the following advantages:

• Speed of implementation
• Total security of data
• Low cost of entry solutions
• Lower risk
• Ease of update
• On demand professional support and advanced analysis
• Single central, easily accessible solution
• Complement to existing in-house solutions

Activity Based Costing has traditionally included only cost data. Incorporating revenues makes models more useful, but is not as simple as it may first appear. This paper discusses the issues involved in applying revenue data to ABC models, and outlines the potential approaches to an Activity Based Profit model.

This white paper provides practical steps that can be taken by Colleges and Universities to take control of your costs. It discusses options like:

• Outsourcing
• Limiting Legal and regulatory exposure
• Limiting undersubscribed classes
• Leveraging Technology
• Addressing the costs associated with athletic programs