Thesis (M.Com. (Accounting))--University of the Witwatersrand, Faculty of Commerce, Law and Management, School of Accountancy, 2017 / The Water Trading Entity (WTE) under the Department of Water Affairs and Sanitation in South Africa is mandated by the National Water Act to charge users for raw water supplied, and the tariffs it charges must enable it to fully recover its costs. The entity is concerned that it is not achieving full equity in relation to refining the recovery mechanism to obtain tariffs that represent usage of resources. This research study sought to investigate the possibility of implementing Activity Based Costing (ABC) in order to overcome the deficiencies of using the Traditional Costing system. ABC is a costing tool that measures the cost of activities to provide more accurate cost information for management. This research examines the practicalities of applying ABC in the water sector. WTE supplies raw water to the Water Boards who further supply to Municipalities, which in turn supply to the final consumers. It is possible that due to the limitations of the traditional costing there may be a price distortion throughout the water supply value chain, and if this is corrected consumers may pay a fair price for water. This research paper has revealed that indirect costs are quite significant within the WTE and proposes an ABC model that would be easy to implement to allocate costs more accurately leading to a full recovery of costs.
Keywords: Activity Based Costing, Traditional Costing, Indirect Costs, Water Schemes / GR2018
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:wits/oai:wiredspace.wits.ac.za:10539/24404 |
| Date | January 2017 |
| Creators | Ndoro, Misheck |
| Source Sets | South African National ETD Portal |
| Language | English |
| Detected Language | English |
| Type | Thesis |
| Format | Online resource (45 pages), application/pdf |
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