Activity-based management uses activity analysis and activity-based costing data to improve the value of the company’s products and services and to increase the company’s competitiveness. Activity-based management would assist internal auditors in appraising the efficiency with which resources are being used by respective profit centers.
Flexible budgets would assist internal auditors in appraising the efficiency with which resources are being used by respective profit centers, if they are compared with actual results.
Joint cost allocations allocate joint manufacturing costs to individual products that are produced through a single process that is used to begin the production of what becomes two or more separate products. They are helpful in determining the costs for each product in order to determine pricing and profitability of individual products. Joint cost allocations would not do anything to assist internal auditors in appraising the efficiency with which resources are being used by respective profit centers.
Variances are a comparison between the budgeted results of the company and the actual results of the company. The more detailed levels of variance analysis determine, to a greater extent, the cause for the difference. Cost variance analysis would assist internal auditors in appraising the efficiency with which resources are being used by respective profit centers.
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