Friday, October 2, 2009

REVISED COSTING (RCS) FOR AC LOCO POH

REVISED COSTING IN RAILWAY WORKSHOPS – LW/PER FOR AC LOCOs
Ø Wide variation in the existing cost procedure
Ø Due to non-standardization of work like POH, IOH
Ø Revised Costing
v Solves the existing deficiencies and gives additional information
v Based on the Cost Center approach Cf: Hassan Iqbal Recommendations
SALIENT FEATURES:
1. applicable to AC locos
2. average unit cost of locos class wise
3. trifurcation of activities
a. Normal OH or Group A
b. Unscheduled – Group B
c. High value items – Group C
4. Average unit cost of OH for each identified major assembly
5. average unit cost of all major repair activities- power/control cables
6. average unit cost of major modification
7. cost of high value items individual loco cost center wise
8. proforma on cost- for managerial information
9. Cost of capital spares use din individual locos
METHODOLOGY:
Work orders to have eight digits
1. Railway No, 2 & 3 shop No, 4 Demand No, 5 Minor Head,6,7&8 Cost Center No
eg., 5 12 6 5 502

No change in the existing work orders for on cost
Define POH and IOH
Cost center is a section or a group where specific repair activities are under taken- identified by a cost center No Eg. Transformer and oil cooling, bogie and brake rigging, wheel axle and axle box.
RCS trifurcates the repair cost in to 1 Basic, 2 variable, 3 high value items.
RCS requires a Monthly Statement of Non Stock items cost center wise.
RCS insists on the generation of Section Outturn statements based on Cost Center wise separately for A,B & C.
In the outturn for A, B & C loco wise input to be shown.
Total quantum of work done in a particular cost center in terms of standard unit/assembly corresponding to WAM 4
Non-POH costs should not be included in the POH out turn when it is undertaken in the POH shops. Separate outturn for non-POH activities for completed work to be prepared.
Pre determined ratios is on time study of collection of costs cost center wise for each repair / overhaul
Establishment of separate costing cell in accounts office to work out the unit cost of repairs of each assembly/modification under section officer (A) and submission of accounts to Books section – a technical supervisor to be nominated for co coordinating with the costing cell
The RCS insist on collection of expenses under cost center wise for labor and stores
No changes in the workshop general register for the RCs
No change in the existing outturn statement
The average unit cost of a cost center is arrived at by dividing the total expenditure of the cost center by its equated output.
Loco repair cost is arrived by adding the costs under groups A,B & C
Distribution of SOC, GOC and POC shall continue as at present

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