Time-Driven Activity-Based Costing in Banking Industry (A Case Sudy in Bank Keshavarzi)

Document Type : Original Article

Authors
Fraydoon rahnamay Roodposhty 1
Davood Ghoreishi 2
Abbas Farsi 3
Mohammad Norozi 4
1 Faculty member, Islamic Azad University , Science and Research branch.
2 Ph.D. student, financial-public management,Islamic azad university,Tehran central branch (Corresponding Author).
3 Phd student , financial management, Tehran university
4 M.A in business-financial management,tarbiat modares university
Abstract
Activity-based costing (ABC) is a particular costing methodology that calculates the cost of products, in time unit, from the total costs of activities resulting in presentation of banking products. In this paper, the cost of banking services in 10 selected branches of Bank Keshavarzi in Tehran in 2016 is computed by Time-Driven Activity-Based Costing Method (TD-ABC) and the outcomes are compared with current banking charges. The products at sample branches level include banking services, deposit services and bank financial facilities in local and foreign currencies. It is to be noted that the financial data collected from branches and Headquarters have been utilized in the study.The findings of the study display that cost of banking products, considering branches internal services (internal pricing) and the current banking charges for each of the services, presents various outcomes. So these findings, in addition to helping the bank managers to assess the performance of departments can provide useful information to improve performance and increase the efficiency of them
Keywords
Time-Driven Activity-Based Costing
Banking Industry
Accounting Management
Activity-based costing
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