Abstract:

Years of research studies on the application of activity-based cost calculation clearly recommend this approach as a tool for cost management at universities. The complexity of processes carried out there and the considerable size of the organizations themselves entitle to state that the process approach to cost allocation will provide complete and useful management information. In contrast, traditional calculations have been indicated as highly unsatisfactory; cost information their provided was suggested to be vague and focused on external reporting, management information reduced to a minimum and the data obtained delayed of several months. At the same time, investigation of the education market and legal regulations concerning universities have revealed that the demand for cost information is increasing and remains unmet. The increase is caused by challenges, such as the decrease in the birth rate and education internationalization, that make universities compete for students on the local, but also global, market; the situation resembles companies struggle to win customers. It forces universities to improve their management systems, including systems responsible for enhancing the efficiency and cost calculation. The universities funding systems with their stringent requirements on how the funds are spent provide further examples of growing demand for cost information. For instance, Polish legal regulations indicate that the cost of part-time studies should not be higher than the actual costs incurred and indirect costs should be assigned to research projects instead of being allocated to predetermined overhead indirect costs. These and other challenges make universities to look for better cost management tools.

There are many reports on application of activity-based cost calculations, carried out years ago, at Australian and British universities. However, despite the apparent advantages there are no reports on further wide application of process approach to cost calculation at universities, including Polish institutions. The existing reports are still limited to formulation of proposals, pilot studies or implementation of the process approach but only in some areas of universities (e.g. in supporting processes, activities of libraries). It has led to the development of a thesis that years of positive recommendations of studies on activity-based cost calculation are of limited use for cost management at universities, and, in turn, to a question about the reasons behind it. To understand the reasons is of the utmost importance, especially for Polish universities, which are entering a phase of intense informatisation, as the growing number of reports on ERP systems usage at Polish universities indicate.

In this article, the author elaborates on the advanced thesis. Ten years of his experience related to the application of activity-based cost calculation at universities is presented, including research projects funded by the Polish National Centre of Science. He also shows and compares cost calculation models, especially those concerning costs of education. He presents the conclusions drawn from the comparison of the calculations made in 2011 and those obtained from procedures performed today. He also discusses the main problems and obstacles in process approach implementation, and indicates how it should be included during implementation of informatics systems at universities.

Keywords:

Activity Based Costing, cost, cost of education.