Model of the cost management accounting in the cement manufacturing factory in vietnam

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INTRODUCTION
1. NECESSITY OF THE THESIS
In the current stage of development of Vietnam's economy, businesses have faced
with competitive pressures of the business units in the same industry and foreign
investment companies.Vietnamese businesses need to use existing resources effectively
and take full advantage of the positive impact of external forces such as supporting
policies from Government: credit policy, investment policy in key sectors. However,
promoting internal forces is still the effective solution in order to help companies become
more active in their orientation. Promotion effective governance of enterprise as
promotion of human resources, of intellectual sources is a key to be able to continue to
develop the material resources of the enterprise. How can businesses apply appropriately
management tools for corporate governance working effectively; that is a big question.
Accounting in general and management accounting in particular play a critical role in
providing useful information for administrators to manage resources and make the most
appropriate decisions.
Vietnamese cement production sector has developed in association with the growth
up and urbanization speed of the country. After a period of strong growth, from 2010 to
now, the cement manufacturing enterprises in Vietnam have stood before the oversupply
situation. Line series, the new plants have operated in moderation, loss and even
stopping production because of rising costs, their products are not sold. The difficulty of
the cement industry started in 2010. From that time, cement produced in Vietnam has
consistently been sold at the lowest price in comparison with countries in ASEAN
region; particularly its price is always below 50 USD/ton while average price of cement
in the region of 65-75 USD /ton. With a mission of stabilizing the market price and
supply, contributing to curbing inflation, stabilizing macro economy, from 2008 to the
present, the price of cement has increased by only 30% while the price of coal, the main
material to produce fuel cement, has increased 4 times, the price of electricity, gas, oil
are also adjusted continuously. Late in 2010, the cement businesses under the pressure of
increased exchange rate between the dollar and VNĐ, interest rates soared so the cost of

cement price increased by 22-30%. Big cement producers such as Bim Son Cement;
Nghi Son Cement; Cong Thanh Cement; Hoang Mai Cement, Hoang Thach Cement
have constantly applying innovation and progressive techniques to reduce input costs
while improving quality and production output. However, those companies have not used
economic management tools effectively to control costs.
The question for managers is how to promote the existing resources, improve
competitiveness in order to survive and thrive during this difficult period. Promoting the
role of providing information management accounting for decision-making processes of
the internal managers of cement production enterprises is one of the effective solutions.
On the other hand, the author would like to develop the application of management
accounting in the specific context of the Vietnamese cement production enterprises, then
build theory (factors impacting the management accounting model) and choose modern
model to apply in accordance with the cement production enterprises in Vietnam.
From the above reasons, the author has chosen the theme: "Building a model of cost
accounting in cement production enterprises of Vietnam" as the subject of my doctoral
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dissertation to be able to improve capacity of scientific research and also help cement
manufacturing industry manage more efficiently their costs.
2. OVERVIEW OF RESEARCH
The studies mention the fundamental problems of cost accounting. Scientists have
studied in depth the methods to cure difficulties in controlling expenses separately.
There was a study which oriented cost accounting model of each type of enterprise,
has proved that the design of management accounting model for businesses needs basing
on direct factors such as: the organizational structure; the interdependence between
departments; the demand for information on the cost of the CFO; the technical process of
production; facilities perform accounting work; the level of accounting personnel; The
legal environment for manufacturing industries. The above works only solve two aspects
which are general orientation for cost management accounting model and direct factors
mentioned above. The study of foreign scientists goes deeply on the application of

modern administration method such as ABC, ABM, BSC, the method of determining the
cost norms, the model allocation of overhead cost of production The research has
focused on management accounting for business associated with a specific business
sector towards filling gaps. The content is built like building apparatus of cost
management accounting, putting in a cost estimate and cost norms, methods of
determining implementation cost, cost variance analysis. However, no public works
design the model of management accounting for a particular business or an industry.
From gaps in research projects, the author wants to continue searching on the
effectiveness of management accounting in corporate governance. Theorically, the
author find out relations between scientific management accounting and corporate
governance through analysis of the demand of information of adminitrators, is the basis
for building the model of cost management accounting for businesses. At a practical
level, through research on the status of management accounting in cement production
enterprises today, the information needs of all levels of corporate governance, the author
completes the model management accounting for cement production enterprises in
Vietnam with two factors: the cost accounting apparatus combined with technology of
production cost information (content and implementing process, method, and techniques
of cost management accounting) in order to achieve the scientific product with high
applicability.
3. PURPOSE AND SCOPE OF STUDY
3.1. Research purposes
The purpose of the thesis is to generalize theories of cost management accounting in
businesses and characteristics of the cement manufacturing in Vietnam, and then build
models of management accounting applying for the cement production enterprises in
Vietnam. To achieve the purposes the author searches on model of cost management
accounting with modern methods, the lessons learned from the developed countries
combined with specific studies of the cement manufacturing industry in Vietnam.
3.2. Scope of the study
The author has investigated the accounting information of cost management
accounting from the Vietnamese cement production businesses nationally with

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representative sample of 71 firms. The enterprises selected represent geographical area,
firm size, type of ownership. With the detailed data, the author focuses on searching in
the cement business representing forms of ownership and model of corporate
governance, type of cement production technology including: Nghi Son cement JSC;
Bim Son cement JSC; Tam Diep cement JSC; Tien Son cement JSC; Hai Phong Cement
Company; Ninh Binh Co., Ltd. 27/7.
The scope of the study period is limited to 5 years (from 2009 to 2013) in order to
recognize the newest features added in the cost management accounting in enterprises.
4. SUBJECTS AND METHODS
4.1. Study subjects: Study on model cost management accounting in production
enterprises in general and the businesses of cement production in Vietnam.
4.2. Research Methodology
Research Methodology
: To accomplish the information gathering process the
author used specific qualitative research methods are as follows:
* Documentation lookup method:
The author uses the method to access documents
in theoretical research on issues related to research content from the source: The system
of specialized monographs compiled, specialized magazines at home and abroad,
scientific research works such as theses, dissertations, scientific subjects
* Methods of collecting primary information: The primary information will be
collected through a survey of businesses.
Survey:
The survey questionnaire was designed to gather information from
businesses about: The size and characteristics of managerial competence and control
procedures for cost information; Technological characteristics of production line;
production model, the reality of management accounting in businesses, model of
management accounting engine; the status and content of management accounting as

cost estimates…
Consult experts:
Expert consultation will be undertaken through consultation with
specialists (the researcher experts have a deep understanding of cost accounting) to
create a system of theoretical models of cost management accounting for businesses and
for the cement industry in particular.
- Methods of synthesis and processing information.
+ Information and documents obtained are divided into 2 groups: theoretical,
practical to systematize and deploy writting arguments and the state of the industry.
+ The information and data collected from the survey questionnaire and in-depth
interviews is the basis for the author to use statistical methods for each content; and then
describe the current status of management accounting systems of cement production
enterprises in Vietnam. Data collected from the survey will be used to analyze and then
to confirm factors impacting and the appropriateness of the model selected for cement
production enterprises in Vietnam.
Approach the research content:
To accomplish the research objectives the author
will conduct research under the following workflows: The author reviews the research
studies and theoretical basis of cost, of cost management accounting. Next, the author
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designs general model of cost management accounting for businesses and gives views of
structure of the model. Then, the author searchest and carries out surveys the state of
cement production enterprises nowsaday. Characteristics and factors of internal
management of the Vietnamese cement businesses are orientation for the author to select
suitable model of cost management accouting for cement production enterprises
inVietnam.
5. CONTRIBUTION OF THE THESIS
The dissertation is expected to contribute the following:
Theoretical:

The thesis presents the model of cost management accounting in
manufacturing enterprises in relation to cost management functions in business and cost
information needs of administrators. The thesis presents three types of model of cost
management accounting: separate models, combined models and hybrid models. At the
same time the thesis states that management accounting model on theory is composed of
the following factors: cost accounting management apparatus and technology of
production cost information.
Practical:
The author presents the current status of management accounting at
cement production enterprises in Vietnam with following content: methods being
applied; factors affecting such as management apparatus, technological process of
cement production. From that, the author builds a model of management accounting in
accordance with the Vietnamese cement manufacturing companies.
6. STRUCTURE OF THE THESIS
In addition to prescribed layout, thesis is structured in three chapters:
Chapter 1
: Rationale for model of cost management accounting in manufacturing
enterprises
Chapter 2:
Current status of cost management accounting in cement production
enterprises of Vietnam
Chapter 3:
Building a model of cost management accounting for cement
production enterprises in Vietnam


CHAPTER 1:
RATIONALE FOR MODEL OF COST MANAGEMENT ACCOUNTING
IN MANUFACTURING ENTERPRISES
1.1. The views and nature of cost management accounting model

1.1.1. The ideas of the model
The concept of model Vietnamese dictionary as follows: "Material with same
shape but shrinked a lot, simulating of structure and operation of other objects to present
and research" or "method of brief expressing of essential characteristics of an object by
one way to study that subject. "Structural models are applied in many research fields”.
The model of structure is the model showing all internal components of material,
phenomenon (not necessarily the phenomenon, the object is a system). In the opinion of
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the author, cost management accounting model is belong to structural model generalizing
the asynchronous elements as tools to control production and business costs. Thus, it is
necessary to clarify elements and their relationships to identify specific patterns of cost
management accounting model
1.1.2. The essence of the model of cost management accounting in production
and business enterprises
For interpreting the nature of cost management accounting model, the author
approaches of: function of cost management in enterprises, then identify managers’
demand of cost information using as a basis for constructing process of cost management
accounting.
Cost management accounting model shows two elements including coordination
of accounting personnel and cost management content, process and methods, applied to
achieve the objectives of providing cost information for all levels of internal
management. From concept given above, the model of cost management accounting
consists of two basic components: cost management accounting apparatus and
technology of production cost information (content, process and technical methods of
accounting)
1.2. Requirements and principles of building cost management accounting
model
1.2.1. Requirements of constructuring cost management accounting method.
The model of management accounting constructured needs to ensure following

requirements:
- Provide timely and complete information as required by the internal management
level authorized for each content costs, for each job, department, project, product orders.
- Provide accurate information as requested by management executives.
- The management accounting information provided to ensure the details.
1.2.2. The principles of building the cost managerial accounting model
The model of cost management accounting is a tool providing information for the
management of resources in the enterprise. Therefore, management accounting
information provided is necessary to ensure reliability and practicability for internal
management of businesses. When building the model of cost management accounting
should follow the following principles:
The objective principle:
management accounting information provided has to
reflect the reality of the economic transactions arising in businesses.
The matching principle:
Design the model, especially the personnel apparatus
must perform in accordance with the characteristics of business and management skills
of managers.
The savings and efficiency principle:
Applying the model of management
accounting in businesses should be considered in the process of saving manpowers,
utilizing the existing conditions in the enterprise.
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Coordination principles: accounting department undertook cost management and
other departments within the enterprise should regularly exchange information in order
to provide information for management accounting.
1.3. Factors affecting cost management accounting model
Regulatory environment includes the system of laws and regulations of the state
namely accounting act, accounting standards and circulars guiding direction for the

accounting operations of the business. Management accounting needs to create a legal
framework to guide management accounting specifically in the enterprises. Besides,
there are some factors such as business environment; positive environmental
information.
The internal factors are the major determinants which help firms choose the model
with the appropriate content to meet the multiple needs of their internal information.
These are the factors that directly influence the process of building the cost management
accounting model to provide useful information for management activities: operation
field; management apparatus; technological processes; quality and human skills
1.4. Cost management accounting model in enterprises
As confirmed in previous content, the nature of cost management accounting
model on cost management perspective is the form of management accounting
organization which is made up of the cost management accounting apparatus and
technology of production cost information. The combination of these two factors can be
done through three forms namely:
Combined model is a model in which financial accounting and managerial
accounting are coordinated in the same accounting system. Separate model is a model
that financial accounting and managerial accounting are split. Mixture model is a model
that accounting system has both financial accounting modules and managerial
accounting modules of accounting apparatus and accounting work.
1.4.1. Model of cost management accounting apparatus.
The organizational structure of the cost management accounting model:
* Combined model of cost management accounting

This model combines financial accounting and managerial accounting in a same
accounting system. In terms of organizational structurr, the accounting model is not
divided into financial accounting and managerial accounting separately; but only divided
into separate parts performing partial accounting work assigned. Accountants in charge
of each part do all work related both financial accounting and managerial accounting [21,
p 28]. This model has the advantage of conveniency, easy operation and compact.

However, this organization requires the organizers understand the qualifications and
specific capacity of bookkeepers and must clearly identify the work of financial
accounting and managerial accounting in each part.
* Separate model of cost management accounting

In the model, financial accounting is seperate from managerial acconting both
in accounting apparatus and accounting work. Accounting apparatus in accordance with
this model consists of two main parts which are financial accounting and managerial
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accounting. The two parts may be in the same room or two function rooms. The financial
accounting department has functions of recording transactions arising from economic
units in the consolidated accounts and of presenting of financial statements complied
with accounting regulation. The managerial accounting has function of receiving,
processing and supplying information from the original document to meet the needs of
all levels of management. It prepares detailed cost estimates; analysis, processing of
information, and establish management accounting reports as requested by managers.
The managerial accounting also provides information for the planning of production and
help out managers in decision making [21, tr29].
* Mixture model of cost management accounting

The model is a combination of the two ways of organizing combined model and
separate model. With this model, some parts of managerial accounting are held
separately from financial accounting, while some other parts are combined. This model
has the advantage of making a stepping stone for companies that want to go straight up
separate accounting model but the management level as well as the size is not enough to
hold separation of managerial accounting
1.4.2. Technology and methods and means of production of cost information
This is the second element of the cost management accounting model which are
process, content, cost accounting methods and specific techniques of management

accounting. They are applied to implement objectives of controlling costs and of
providing cost information for decision-making processes in enterprises.
1.4.2.1. Classification of costs in manufacturing enterprises
Classification of costs according to function: According to this classification, the
cost is divided into production costs and external costs of production. This classification
is used frequently in financial accounting for calculating product cost. The classification
helps accountants control easily expenses incurred in different stages of production
process, and from that connect responsibilities of managers with every location costs
incurred.
Classification of costs according to cost elements (according to the economic
nature): Costs are divided into: cost of materials, the tools and instruments; labor costs;
depreciation and amortization expense; external service costs; other expenses in cash
This classification allows enterprises to control costs for each material and non-material
resources consumption during production and then evaluate the effectiveness of using
each resource for making timely adjustments.
Classification of costs according to the relationship between costs and operation
capacity: According to this classification, the costs incurred are divided into: fixed costs,
variable costs and mixed costs. This classification is based on relationship between costs
incurred and fluctuation level of production capacity.
Classification of costs according to operation capacity is the basis for making
operating decisions and business activities of enterprises.
Classification of costs according to the relationship between costs and object for
gathering costs: Cost structure under this classification includes: direct costs and indirect
costs. This classification helps to collect and process cost information appropriately.
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With the direct costs, accountants directly determine and transfer entire costs for the
object for gathering costs. For indirect costs, accountants need to gather all costs for
objects then select appropriate allocation criteria for each object.
Classification of costs according to the relationship between costs and the

financial statements: Classification of costs according to this criterion, costs consist of
product costs and period costs. This is the way of classification showing relationship
between costs and financial statements. This classification indicates that not all costs
incurred affect the profits and losses of the period that costs incurred. Classification
allows an overall assessment of the value of assets and the operations of the business
enterprise in a period, evaluates results and business operations in future periods.
Classification of costs based on the level of executive control: According to this
classification, the costs of business including: controllable and uncontrollable costs. The
classification has important implications for the management responsibilities of each
department so that businesses can assess management capability and responsibility of the
individual for the costs incurred under their control.
Classification for analysizing, comparing to choose the optimal business plan: To
serve the information for decision-making processes at all levels of management in
business, costs includes opportunity cost; differential costs; sunk costs These are costs
that affect the business decisions of the enterprise and help administrator consider when
selecting a business plan.
1.4.2.2. Construction norms and cost estimation in manufacturing enterprises
Norms of cost

Norms of cost is the standard for cost control and is the basis for the organization
responsible accounting because norm cost is a measure to evaluate performance of
responsibility centers and cost centers charge. The actual rate is used to compare the
performance results, the difference between the implementation and the actual norm; it
indicates deviations outside the normal operating conditions to guide managers check
steps to find the exact cause in order to overcome disadvantages. Actual norm is the
basis for the estimation. Ideal norms can only be achieved in the best condition; no
machinery is broken, skilled employees work most effectively [16, tr139].
Constructing norms of costs: Norms of costs is effective tools to control costs.
Construction norm cost has to base on system of economic and technical norms.
Building norms of costs can apply statistics of experience method or technical and

economic methods.
Estimation of costs

Estimation are the planning to use resources in a period, expressing as the
expected details on the mobilization and use of production factors, the financial
resources to ensure that the activities of enterprises occurring normally and to contribute
to improving the efficiency of all activities. System of estimates is made in businesses
mainly static estimates, which is set to a specific production capacity. The flexible
estimation is built on a series of activities aimed at providing information on the costs,
revenues and achievable profits. Estimation process can be carried out according to the
different sequences: Estimation can be made from the top to the bottom or vice versa.
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1.4.2.3. Determinng production costs
Identify objects for gathering production costs: Identify objects for gathering
production costs is the first step in the organization of production cost accounting. The
essence of identifying the objects is finding out where the costs are incurred (workshops,
production department, engineering phase ) or objects incurring costs (products, orders,
).
The methods of determining the cost of production.
Actual expense method: Under this method, production costs include all expenses
incurred in relation to production, including the cost of direct materials, direct labor costs
and overhead production costs. The direct costs are directly aggregated for each object
incurring expenses, and overhead production costs are normally collected and then
allocated to the object incurring costs under the appropriate criteria at the end of period.
The method of gathering the actual costs associated with the estimated costs:
Under this method, costs incurred during the period have been recorded and stated.
However, the cost of production calculated for the volume of the finished product can be
determined on the basis of actual cost or estimated cost, depending on the nature and
aggregateability of each item of costs.

Standard cost method: The standard cost is other name of the norms of costs. In
business management, standards include standards in terms of quality and price.
Standards is a baseline for comparison with actual incurred to determine the differences
of costs, and then find causes and solutions resolving these defects in the stage of
production that cost differences arised. On that basis, it helps administrators make timely
business decisions;
Determine costs according to tasks (according to orders): Method of determining
the cost basing on works is often applied in businesses that produce products by orders,
single product with high value and large size. This method records detailed information
of each individual products or group of similar products. Under this method, the costs of
production are divided into the following expense items: direct material costs, direct
labour costs and overhead production costs. In particular, direct material costs and direct
labour costs are aggregated according to the actual costs incurred and overhead costs are
estimated and allocated according to the allocation criteria selected.
Methods for determining costs under the production process: This method is
applied into enterprises that manufacture products through continuous production
processes. Products are made in large quantities, not able to account separately costs of
each individual product. Costs are collected at each department, each production stage
and then calculating the product cost according to production period. Finallly, at the end
of accounting period it is necessary to calculate costs of work-in-progress products by
different methods.
The modern methods of determining costs
The traditional method of determining costs has advantages of easy
implementation, not requiring qualification of managers and direct doers. However, it
also has disadvantages such as accuracy of expenses and product costs maily depending
on method of allocation indirect costs, lack of scientific co-ordination between
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departments concerned to adjust operations as needed. Therefore, to overcome the
limitations, enterprises in developed countries have ignored the traditional method of

cost accounting and applied the modern methods such as: activity based costing – ABC
or target cost.
1.4.2.4. The analysis information provided for cost management in enterprises
The process of analyzing cost information uses common methods of business
analysis as the comparative method, exclusion method to determine fluctuation level and
causes of that fluctuation. Comparative method is used to determine the fluctuations of
following criteria: actual costs comparing to estimated costs or norm costs; actual profits
and estimated profits At the same time, exclusion method is used to find causes and
effects of each factor to the fluctuations. Since then, corporate managers use cost
information for the process of decision making: analysis of cost differences, analysis of
relationships of costs, productivity and profitability; analysis and evaluation results of
operations of cost centers; cost information for managerial decision making.
1.4.2.5. Segment reporting in the business.
The organizational structure of the business includes components associated with
business task assigned. Assessing the department's responsibilities is often implemented
through the segment reporting analysis after a period of activity or predicting economic
targets for the next period. Segment reports are reports comparing revenues with the
costs of parts to determine business performance and operational efficiency of the
department in the organization. Segment reports have often changes when changing the
organizational structure or changing products or services, business sector or changing
demand of information for internal administration activities.
1.5. Experience applying cost management accounting model in developed
countries
In the developed countries of the world, cost management accounting science
have become an indispensable tool for internal management of enterprises, especially
large corporations in developed countries such as Japan, USA, France If every
business has direct investment in the research activities of the cost management
accounting so that businesses use in developing management solutions provide economic
efficiency. That is the real lesson for Vietnamese enterprises to approach and use in
accordance with specific conditions of each business and each industry. The author

introduces the model of cost management accounting in countries which typically have a
lot of researches and practical applications of cost management accounting. From that,
the author draws lessons, builds orientation for cost management accounting model for
specific businesses in Vietnam. Large –scale businesses in Vietnam have started to apply
modern management method into production and business activities. However, cost
management accounting has not really become a useful tool which provides information
for managers. Learning experience from developed countries, our country should select
appropriate content for Vietnamese enterprises to promote effectiveness of management
of business operations.


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CHAPTER 2:
THE CURRENT SITUATION OF COST MANAGEMENT ACCOUNTING
BUSINESS IN VIETNAMESE CEMENT MANUFACTURING
2.1. Conspecturs of cement production industry of Vietnam
2.1.1. History and development of the cement industry
Cement production is one of the basically industrical production formed and
developed earoliest in Vietnam. After the date of 30
th
April 1975 the cement industry
takes over Ha Tien cement plant with capacity of 300,000 tonnes /year, produced by the
making wet reverter furnace method that was built during America – Wei period and Hai
Phong cement factory with some cement workshops of vertical kiln. Then the North area
has two modern cement factories with large capacity Bim Son (Thanh Hoa) and Hoang
Thach (Hai Duong) built and put into production in 1981 and 1983. Bim Son Cement
Plant was invested by Soviet Union (former) with two wet process rotary kiln, the size of
5,0mx185m, capacity of 1.2 million tons of clinker per year; Hoang Thach Cement
Factory was invested by F.L Smidth with a dry process rotary kiln, the size of

5,5mx89m, capacity of 1.1 million tons clinker per year. To the South, in the province of
Kien Giang, Ha Tien cement plant with two wet method rotary kiln, the size of
3,3x100m of the Venot-Pic firm (France) was expanded in 1991 with a dry process
rotary kiln, its size of 4,8x64m by Polysius firm (France) Milestones of the cement
industry was confirmed by the number of enterprises producing cement stretching from
north to south, up to 91 businesses in 2013. The development of the cement industry and
cement businesses associates with the development of technology of cement production.
All cement manufacturing enterprises nowsaday have large scale and using modern
technology.
2.1.2. Overview of the operational characteristics and organization of
management apparatus of cement manufacturing enterprises
To study on the status and characteristics of cement production enterprises in
Vietname, the author selects the sample of 71 firms out of 91 (78%). Contents of the
surveys in the enterprises are knowledge of the general characteristics and the status of
cost management accounting in corporate (Annex 2.2). Now, all cement manufacturing
enterprises (100%) have large scale and using technology of rotary kiln dry method.
Thus the author chooses businesses with two criteria of geographic area and ownership
type to implement the survey. From the survey results the author collects and summarise
by statistical and analysis methods to find out the characteristics of production, business
operation and management apparatus, management accounting situation at the cement
manufacturing businesses. In the tables for illustrating, the author selects real data of
Bim Son Cement Joint Stock Company
2.1.2.1. Production features of cement manufacturing enterprises in Vietnam
Cement manufacturing industry has complex production line, continuous
processing. The cement businesses are large scale units. This specific industry is only
organized to produce in locations with natural conditions associated with the supply of
raw materials as limestone, clay, ore Therefore, cement production enterprises
concentrate mainly in the provinces as Thanh Hoa, Ninh Binh, Hai Phong, Ha Tay, Tay
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Ninh Currently, all plants are operating by the dry method with rotary kiln technology.
This is the modern production lines, advanced automation and less energy consumption,
less labor-consuming operation of the production process. The manufacturing process
requires businesses to control costs to each production step: Mash ingredients; Clinhker
baked; Cement grinding The cost of raw materials, labor costs, fuel should be
monitored separately to control the efficiency and cost of each production stage.
2.1.2.2. Features of management apparatus
With large-scale production (number of employees in manufacturing enterprises
currently operating cement production line imported from the former Soviet Union and
France is about 1,000 laborers, with businesses operating new technology it is
approximately 500 to 700 employees), complex production processes,one of the
important factors determining the success of the unit is the organizational structure of the
corporate management in accordance with business sector, scale of production and
business organization, capabilities and capacities of staff. The survey data from 71 firms
of Vietnamese cement manufacturing shows that 100% of cement production enterprises
are online structural management model.
2.1.2.3. Characteristics of accounting apparatus model
Survey results in 71 cement enterprises shows that the cement manufacturing
businesses has an accounting system organized as shown in Table 2.1 below:
Table 2.1: The organizational structure of accounting department of firms
surveyed
Model of accounting apparatus
Number of
businesses
Ratio (%)
Centralized model 67 94%

Dispersion model - -
Mixture model(both centralization and dispersion) 4 6%
Total 71 100%

The mainly used model is concentrated one, the entire accounting work is done
centrally at the corporate accounting department. At the department, subordinate units do
not have their own accounting department, they only have employees on duty of
recording transactions, then transferring documents to the corporate accounting
department to gather and form necessary reports. Accounting department is supported by
accounting software and some application software, so effectiveness of recording
transaction and of controlling business activities increased. This is a feature that allows
the methods and techniques of management accounting able to promote the advantages
of accounting software to use financial accounting information from analyzing, and
processing for objectives of management accounting.
2.2. Situation of cost management accounting of the Vietnamese Cement
manufacturing
2.2.1. Situation of organizational structure of cost management accounting
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The survey data indicates that 100% of the cement manufacturing firms surveyed
do not organize their own management accounting. In some businesses, cost accounting
and product costing department does financial accounting works and provides costs and
prices information for the chief accountant at the request. This department is responsible
for providing information to the chief accountant and advising corporate directors as
needed. However, in the current stage in order to face economic difficulties and market
fluctuations directly affectinge production and business conditions of the cement
manufacturing businesses such as shrink of market share, raw material prices, rising fuel
prices and energy, raw materials for cement production are exhausted, the cement
businesses have to organize production and business activity more efficiently
2.2.2. Current status of cost classification in the cement manufacturing enterprises:
Cost classification is the basis for recognizing and controlling costs, using data to
analyze cost information for decision-making process in the cement manufacturing
businesses. According to survey data from 71 firms shows that the cost classification is

being carried out by the following criteria in Table 2.3.
All enterprises have classified costs by the function to assess the incurred costs at
each stage of production and by the economic use of the production factors. To ensure
the consistency between cost and finished product cost, and to simplize the work of
product costing, cost calculation of the cement products, the cement manufacturing
companies have classified costs according to economic use. Accordingly, the cost of
production is divided into direct material cost, direct labor costs and overall production
cost. However, the production costs classification in the cement manufacturing
businesses just meets the information for the accounting of the production costs and
products pricing in financial accounting, determining the business profit, and ending
financial reporting. This classification has not supported directly to supplying
information for cost management accounting.
2.2.3. Current status of norms building and cost estimation:
2.2.3.1. Current status of the norms building in the cement manufacturing businesses
in Vietnam:
Member companies of the Vietnam Cement Manufacturing Corporation have
operated according to the general system of economic and technological norms supplied
by their corporation. However, to meet the specific manufacture conditions in each unit,
the businesses have built the different norms systems for their units, so that they have a
basis for resources mobilization and incurred costs control during the period. During the
operation and production, the surveyed enterprises are using the systems (such as the raw
material cost norm, labor cost norm, ) as the basis for xuất vật tư. At the end of periods,
the cost norm is the basis for accounting department to compare to actual costs,
accordingly to make reasonable decisions to adjust the production.
2.2.3.2. Current status of cost budgeting in cement manufacturing enterprises in
Vietnam:
The survey results showed that the cement manufacturing enterprises in Vietnam
have estimated costs for their whole fiscal year. Their types of costs budgets are shown
below in table 2.7. At the beginning of the year, the companies build plans of the
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consumption and the production for every month of the year. Based on those plans, they
make the sales budgets for the whole period. From the sales budgets and production
plans, together with labor norms and material norms, the accounting will create the types
of production costs budgets such as material cost budget, direct labor cost budget,
manufacturing overhead cost budget. The cost of sales budget and company governance
cost budget have not been made, that leads to the lack of information to compare the real
status and the budgets at the beginning of the period.
2.2.4. Current status of manufacturing costs determination:
Manufacturing costs in the cement companies are calculated according to the
actual cost method (Costs incurred in the companies are classified by the function and
economic nature of the manufacturing factors). Because the cement manufacturing
process is complex and continual, the companies are monitored and aggregated
manufacturing costs by stages of the manufacturing process. At the end of months, the
accounting department aggregated the manufacturing costs to calculate the finished
goods cost and create the accounting reports. All above costs are aggregated in the whole
company and every stage in details. Table 2.8 shows the cost objects in each stage.
Table 2.8: COST OBJECTS IN MANUFACTURING STAGES
Cost objects Wordshop
1Powder raw material production stage
2. Clinker production stage
3. Powder cement production stage
4. Packaged cement production stage
1. Materials workshop
2. Kiln workshop
3. Cement workshop
4. Packing workshop
(Source: Bim Son Cement Joint Stock Company)
To illustrate the accounting process of production costs, author present the
processes in the surveyed companies by interviews and collect specific data which is

generallytypical for cement manufacturing companies in Vietnam.
* Direct material costs accounting: Direct materials costs include costs of
main raw materials, auxiliary materials, fuel supporting to the production in companies.
The control of material costs incurred in the cement manufacturing enterprises has been
conducted by different criteria, in order to provide information for their cost
management.
* Direct labor cost accounting: Direct labor cost includes salaries, allowances,
overtime salary, and salary deductions to pay for the direct production workers in cement
workshops. The fact is that the cement manufacturing companies mainly use the method
of payment according to the volume of the finished products. End of month, they base on
the volume and quality of the finished products (output in a month) to do payroll
accounting for direct labor in each manufacturing workshop. Form of payment for the
workers is by the products. Many companies are paying salary by the contractual wage
contracting such as: Nghi Son Cement Company signed the contract for workers based
on the production plan established at the beginning of the month. Direct labor costs in
the cement manufacturing businesses depend on the technology level of manufacturing
processes. Currently, new production lines which have been invested in the cement
15

manufacturing enterprises such as Cam Pha cement JSC, Hoang Thach Cement
Company, with the most advanced technology are consuming labor cost of of a quarter
of the cost 10 years ago with the old technology.
* Accounting overhead cost
Overhead cost is the cost which support to manufacturing management in the
workshops, and the production units. Overhead costs include cost of workshops’
management staffs; costs of materials, tools and supplies used for production;
depreciation expense; external service costs; Other cash costs, After aggregated in
each workshop, overhead cost is aggregated for the whole company in order to be
allocated to product pricing objects.
Most of the companies allocate the overhead cost in proportion to the direct

materials cost for each cost object and product pricing object. However, there are 10
companies using the proportion of direct labor costs to allocate their overhead cost
incurred.
The cement manufacturing companies aggregate costs to calculate the cost of
finished products. The product pricing object in these companies is work-in-process
product – clinker which is finished after furnaces stage and finished product – cement is
made after 4 stages of the production.
Costs of sales incurred in selling centers and in branches are aggregated by costs
locations. Costs of sales were detailed by cost factors including: sales staff cost, cost of
materials used for sales, depreciation cost, advertising cost, At maturity, costs of sales
are aggregated for the entire enterprise and calculate the profit.
Company governance cost incurs in the functional departments: Division of planning;
Division of labor organization; Office supplies, The costs are tracked in detail for each
cost item. At the end of period, the governance cost is aggregated for the entire enterprise
to calculate the business result.
Interest rate expense in the cement enterprises of Vietnam is high because their
loan capital is accounted for three-quarters of the total capital. This is a considerable cost
in the businesses because of its huge impact on the business results of the unit.
The manufacturing costs and other costs are currently being controlled by location
and the cost factor. This is very important information for decision – making.
2.2.5. Current status of cost management accounting report:
According to the survey at the cement companies on the financial reports system
in general and management accounting reports in particular, the result shows that 100%
of the companies are making periodically accounting and financial reports. Only 45/71
cement companies are making periodically management accounting reports, or upon
request of the internal governance. Management accounting reports are made at the end
of accounting period supporting to the management need. The accounting reports of
costs are made at the end of period and collected by the chef accountant. When director
needs the information of cost and price, he asks the chef of accounting. Currently,
information supply is only set up at the end of the year. When the business result is

identified, the accountants collect the information based on the demand of the director.
16

2.2.6 Real situation of the analysis of the cost information for internal cost
management of company:
* The analysis of the relationship between cost, volume, profit:
According to the questionnaire survey to the cement companies about their
analysis of the relationship between cost, volume, profit; 100% of them said they have
done this work. However, when we conduct the survey by interviewing 10/71 companies
(Tien Son cement joint stock company in Ha Tay, Bim Son cement joint stock company,
FICO cement joint stock company in Tay Ninh, Tam Diep cement joint stock
company,…), the result shows the reverse. The companies have conducted the analysis
of the cost, the volume and the profit items separately but they have not put those items
in a relationship. The reason is that the managers who have high responsibility at the
companies didn’t know any tool of the analysis in management accounting. End of
financial year, the accountants at the companies have compared following items: direct
material cost, direct labor cost, overhead cost, cost of sales, cost of company governance,
finished product cost, sales, and profit. The comparision shows the difference and
variability between last year and this year data, the companies have found out the causes
of this. Their analysis has just reflected history information by comparing one way
relationship between those items: from volume to incurred costs and profit gained.
*Variance analysis for short term decision – making:
At the cement companies in Vietnam, long term decision – making is for high
scale investment such as investment of new technology, update and replacement of
equipment. These decisions are going with long term strategic plan and business
orientation. Every year, the business decisions are made based on last year’s profit and
the market changes, accordingly determine the production scale.
Short term decision – making of the managers comes from the data provided by
the chef accountant. The information related to the cost and cost of finished products is
provided by the accountants who are working in costs in the companies.

2.3 Evaluation the current status of cost management accounting in cement
manufacturing companies in Vietnam:
2.3.1 Cost information control system:
With the scale and characteristics of the cement manufacturing companies in
Vietnam, they organize by the online functional model. This allows the directors to
control all activities in all levels, units, departments – the cost centers. Main production
units are divided by stages which ensure the suitable control to the closed production
line. This model is also fit to the creation of responsible centers. Each workshop creates
manufacturing cost centers, each consumption center creates sales centers,… This is a
basis for building cost management accounting model which should be suitable to the
cement manufacturing in Vietnam.
2.3.2 Evaluation the cost management accounting in the cement manufacturing
companies in Vietnam:
The accounting system and cost management accounting system: The cement
companies organize the accounting system by center model, there are accountants
collecting invoices and documents at the workshops and branches and returning to the
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central accounting department for aggregation. In 71 companies observed, there are 04
companies organizing the system by both center and distributed model. Cost
management accounting in the companies generally are not systematic. The roles of
information needed are all based on the work of chef accountant and other accountants of
costs.
Process of setting cost management accounting information:
The premise to conduct the process of setting cost management accounting
information needed for internal management demand, the companies have applied the
cost classification methods to identify the manufacturing costs incurred: classification by
functions and by costs factors. These are the 2 main methods support to the recording
data of financial accounting, finished products costing.
The costs reports are made based on this classification method in order to control

costs by factors. The companies have not conducted the classification cost by model
methods such as by cost control level of managers, supporting to the decision – making
process.
Setting up cost control standards, building costs norms, cost budget and other
budgets:
The companies have built costs norms based on the technology economic norms
of the Vietnam cement manufacturing corporation and adjusted to fit their own
conditions. This is the standard used to determine real costs incurred in production
process. The budget system made by the companies at beginning of the year is an
orientation for the business and production process of the whole year. This system is a
static budget system. The companies estimate the production volume based on their last
year’s business result and their future period’s condition. In competitive market
currently, there is not any company applying flexible budget system to response to the
market changes.
Identifying and measuring cost, business result – Applying appropriately the cost
measure methods and identifying cost objects; determining activities and department
results: In the Vietnam cement companies, cost objects are main workshop with
manufacturing process, the finished products are cement and work – in process products
like Clinker. To record costs, the companies apply real costing method. The accountants
at the workshops collect documents of costs incurred to aggregate the manufacturing
costs and other costs. By this method, the directors only have the information of costs
after the manufacturing process finishes. Therefore, the reports of costs only can be made
at the end of accounting periods.
The accounting reporting – Setting information provided by accounting reports:
According to the information demand of management, particularly directors in the
cement companies researched, the cost accountants make the costs reports, turn to the
chef accountants to report to the directors. The reports are made by cost factors and by
manufacturing stages, and by time of month. Although the workshops which are the cost
centers are controlled by accountants, they still have not reported costs in every
workshop. Thus, the cost management accounting reports have been conducted but they

18

are still very simple with the information of real costs and not really supported for cost
analyzing.
Analyzing costs, business result and effectiveness – Analyzing by costs centers,
analyzing information for decision – making: The decision – making process in the
companies depends on the accounting reports provided by costs accountants. The reports
form is very simple. The companies have not analyzed the information of the
relationship between cost, volume, profit in order to give the best decisions for their
businesses. The analysis of separated items did not allow the businesses to have an
overall view about the relationship between cost, volume, profit; this leads to wrong
decisions. Therefore, the information of decision – making is just raw, it has not been
analyzed to show the variances and the effects. Those are some backwards in the control
process which leads to not good solutions for costs rising currently.

CHAPTER 3: CONSTRUCT MODEL OF COST MANAGEMENT
ACCOUNTING FOR VIETNAMESE CEMENT MANUFACTURING
ENTERPRISES
3.1. Long-term strategic development of the Vietnamese cement
manufacturing enterprises
According to the information center of the Ministry of Construction, by the end
of 2013, there were 129 cement production lines have been invested and put into
operation with a design capacity of 83.4 million tons. It is expected that by 2020,
domestic cement production will be about 112 million tons, which is 19 million tons
higher than the demand. In the cement manufacturing industry in the coming years,
there will be the possibility of oversupply, so the Ministry of Construction had
document to propose the People’s committees of provinces and central Cities not to
register further cement projects during from now to 2020. The forecast of cement
demand in our country in 2020 by experts was given vary, but the difference is not
large. In general, the forecast of cement consumption in the future of our country

according to the regions shown in Table 3.2.
About investment: Investing in developing sustainable cement industry
contributes to the development of economy and society, rational use of natural
resources, protection of ecological environment, historical and cultural monuments,
landscaping and maintenance security and defense. There are prioritizing investment
in cement projects in the southern provinces; the expansion of investment projects;
projects with large capacity, modern technology and low consumption of fuel and
energy. The cement projects under the portfolio together with this decision are only
allowed to build cement grinding that has a capacity corresponding to the productivity
of clinker furnace; do not invest the individual and independent individual grinding
mills.
About technology: Using advanced technology with high degree of automation,
saving up materials and energy in production, choosing the right device to ensure
stable production, high-quality products and reasonable prices, to increase
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competitiveness in terms of regional and international economic integration. Investing
in synchronization of equipment systems which utilize exhaust heat in the cement
plant to generate electricity.
About capacity scale: Developing plants with large-scale capacity, new
investment projects with a minimum capacity of 2,500 tons clinker/day. For projects
in the remote and the projects of technological transformation from kiln cement
production technology to cement rotary kiln can apply appropriate scale capacity.
Encouraging to establish complex, large cement producers from the existing projects
with the appropriate forms.
About layout plan: Prioritizing investment in cement projects in the southern
provinces, regions with favorable conditions for raw materials, industrial
development and transportation infrastructure; limiting investment in cement projects
in areas with difficult material, bad effect on the cultural heritage and tourism
development.

With goals set out by the cement production industry in Vietnam, the cement
production enterprises need to use synchronous solutions: Solving technical problems
associated with technology management issues resources. Building models of
management cost accounting in accordance with the current conditions of the Cement
Manufacturing enterprises to strengthen cost control is indispensable measures to help
businesses overcome the current economic difficulties.
3.2. Building models of management cost accounting for Vietnamese
cement production enterprises
In condition of production and personnel of the present cement production
manufactories, authors proposed to design a management cost accounting model
associated with the orientation: Promote the available factors, the content of work is
being done; complete and add factors needed to fit the needs of cost control in the
business. The design process of model is based on the production management system
and cost control models available in the business. From there, the author designed the
management cost accounting system incorporated with the process of making cost
information.
3.2.1. Organizing the management cost accounting system
After studying of model of accounting system in general and management cost
accounting system in particular, after surveying real need of scale and level of human
resource accounting department, author found that the combination of management
cost accounting model and financial accounting model in one accounting system
helps to be able to inherit the job information and financial accounting provided.
Accounting department personnel, apart from work of financial accounting can
handle more work of management cost accounting in order to provide cost
information for all levels of internal management. Management cost accounting
managers should be considered as an additional function of the accounting
department.
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With this model the cost control process is performed according to 3 levels of

hierarchical responsibilities:
For production cost: Production foremen are responsible for controlling
expenses incurred within their respective workshops and report to the vice president
in charge of production. General Directors receives information about the cost from
the vice president.
For selling expenses: Expenses incurred at the consumption centers and
branches are under the control of the director of the centers and branches. Director at
consuming centers or branches report cost information related to consumption to vice
president in charge of business. General Directors now receives reports from vice
president in charge of business.
For management costs: Costs incurred in the management department under
the control of managers and directly reported to the General Director.
The manufacturing process of cost information is done at the position of work
in the enterprise.
* Chief Accountant: Is the head of the company's accounting system,
responsible for the entire operations of the accounting department before the director
and the law, general in charge of financial and management accounting operations.
* Accounting expenses, costs (Record past and future information):
* Accounting in the factories (Responsible for recording the historical
information)
The job of management cost accounting need to be formalized by the rules and
regulations specifically written for each job position. The types of operations and
documentations should be designed in the standard form. Time and technical
performance needs to be unified and specified in writing. Transmission of
information, responsibility for providing information for each specific position should
be formalized. This will allow the accounting department can work proactively and
effectively instead of information is only collected, processed and supplied when
receiving requirement of managers. Also relying on that basis, they can evaluate the
job performance of the department and clearly attribute responsibility for each job
position. There should be a combination of financial accounting and management

accounting in the same department but their functions should be clearly distinguished.
With such combination above, accounting system is streamlined and efficient
implementation of the tasks set.
3.2.2. Classifying costs in the cement manufacturing enterprises
The costs are classified according to the activity level and divided into fixed
costs and variable costs. This classification is the basis for determining the breakeven
point, choosing the optimal business plan. This stage is the precondition for
management cost accounting can analyze management accounting information in
situations of fluctuating factors such as the increase in cost of producing electricity
price, advertising costs by analysis techniques of CVP relationships to make
21

decisions about product price, to control and to adjust cost structure thereby offering
reasonable solutions.
The model of management and control costs according to cost centers needs
additional classification of costs into control costs and uncontrollable costs.
Classification of costs into cost control and uncontrolled costs associates
responsibility of controlling costs for each cost center. Production costs incurred in
the main workshops are categorized under the authority of the workshop manager.
This is the basis for applying the approach of target cost and Kaizen methods –
control to maximum cost reduction during the manufacturing operations implemented
in the enterprises.
Furthermore, in the particular circumstances the company can apply this cost
classification to provide information for internal management decisions such as:
sinking costs, opportunity costs to be able to make the most appropriate decision.
3.2.3. Calculating cost norms
The cement manufacturing companies have done to build the norm system
includes: Norms of direct material cost; direct labor cost; overhead cost. The process
of setting limits on the cost bases on the technical norms of cement manufacturing
enterprises in order to guarantee the reality and advancement. According to the

author, to control costs according to cost centers needs to establish additional norms
of selling expense and administration expense. The selling expense norm is a standard
to evaluate the process of cost control at the branches, consumption centers.
Administration expense norm should be established for each functional department.
Cement manufacturing firms have enough cement cost norms as a basis for estimating
costs for each department.
3.2.4. Preparing cost estimating system
Estimating cost in the cement production enterprise is set up for each financial
year. However, the period for calculating cost is monthly (production cost fluctuation
in each month will not be compared, collected and timely adjusted). Thus, the
construction of cost estimating system needs to be complied with the scientific and
consistent process in cement manufacturing enterprises to ensure the effectiveness of
management tools: Ensure consistency in period and throughout enterprise; ensure
flexibility, initiative. Current estimates in Cement Company are static estimates and
are made for each year, which has shown the inadequacies in management. According
to the author, businesses need establish additional flexibility estimates that the cost
basis is the norm of the amount of inputs in the condition of the variations in prices of
inputs through the months of the year, which can be adjusted to suit changing and
reflects the fact rather than specific plans at a time. Or in the case of receiving
additional orders, change in production output, enterprises can adjust flexibly to
estimate consistent with more volatile unusual market conditions today.
3.2.5. Determining the production cost.
In the current period, the global economic crisis and the Vietnam market,
"demand" of commodities is tight, the demand for cement in 2010 and 2011
22

decreased compared to the previous years. Many enterprises in Vietnam recognized
effects of modern management tools, used to control the operation of their business.
The author argues that the cement production enterprises in Vietnam with large scale
production lines and modern technology are moving towards automation need to

choose these modern, synchronous management tools to overcome the current
difficulties. Through the study, author found that the specific conditions of production
and business can now use a combination of target cost method and Kaizen method to
achieve efficiency in cost management and reach expected business target.
3.2.6. Reporting on cost management accounting
From the business model and cost management control process under cost
centers, authors proposed system of management accounting reports of Cement
Company to split into 2 groups: Departmental report is established at the cost center
and company’s cost management report is made at the accounting department of the
company. Reports at the cost center are to control and assess the costs incurred in the
center and send to levels of management as prescribed. In the accounting department,
cost and expense accountant establishes cost reporting enterprise-wide cost
management report in order to analyze cost information and make business decisions.
To develop a systematic, scientific report system of cost management
accounting needs to synchronize cost information. At the same time, the provisions of
the above content must be documented and implemented in a formal way to bring
uniformity across the company.
3.2.7. Analysis of cost information for the internal management
Operational processes and business processes in enterprises can not only use
financial accounting information, information which reflects the past issues to make
future-oriented decisions. When businesses use the method of cost classification
according to the level of activity which divided into two parts as variable costs and
fixed costs businesses can now apply technique of analyzing the relationship between
the cost-productivity-profit to select the optimal business plan in terms of specific
production enterprises. The synchronization of planning process and initial estimating
system can now use CVP analysis method to determine the production output needed
to achieve the expected returns, from which provides direction the coordination
between the stages of the production process so that the complete plan of profit,
revenue and cost harmoniously synchronized.
Analyzing cost information for short-term decision making.

In the current competitive environment, cement production enterprises solve
their problems under the directions: Control in order to reduce production costs,
administrative costs; apply scientific advances in modern technology production; seek
importers to export products, reduce stocks and continue to promote domestic
consumption. Cement industry seeks assistance from the Government on policy loans
with low interest rate and the construction of cement concrete road. However, the
solution from the business will be the most important outlet for each business to solve
23

their own problems. It is essential that the levels of management needs information
for the short-term decision making.
Analyzing and assessing the results of operations cost center.

To control production costs throughout the enterprise, the author proposed to
develop cost centers under management model in the form of online business
functions. The cost centers are formed into 3 groups: Cost center of mass production
function; Cost center of sale function; Cost center of administration function. Then
develop indicator systems and assessment methods, set up reporting systems to assess
cost centers.
3.2.8. To assess the efficiency and to analyze information to make decisions
Among the important functions of corporate governance applied to develop
production and business activities: Development Planning  Organizing to
implement  Testing process  Assessing the implementation process, the
assessment phase to decide adjustments of plan for the next period plays extremely
important role. The assessment should ensure that there is the combination between
the generality and the details, and the association with the assessment liability regime
(reward and punishment) for individuals and related parts.
3.3. Conditions for implementing the cost management accounting model
in Vietnamese cement production enterprises

3.3.1. For enterprises
To help businesses to be aware of this system, there needs real change from the
business.
First, the need to change the mindset of managers on the application of modern
management tools in the current period is a prerequisite. The change of perceptions of
administrators to replace traditional ways is conducted through the effective
communication channel.
Second, in order to apply the model of cost management accounting, the
increase in the professional qualifications of the accounting staff and relevant
departments is also extremely important. The co-ordination of parts, functions in
enterprises need to be scientific, effective.
Third, the manufacturing process must be flexible to accommodate the overall
objectives of the business is controlling costs to achieve profitability goals.
Fourth, synchronization of management tools, automated connection between
the parts of the business are conditions for implementing model of cost management
accounting. Currently, many large enterprises in Vietnam used ERP tools used to
synchronize the coordination of functions and departments within the company,
ensuring the overall planning objectives. The cement production enterprises may
apply ERP system, which is a positive factor for the application of cost management
accounting.
Fifth, there should be a review of the management and function of the
departments in the enterprise.
24

3.3.2. For the State.
It is important that state creates a good environment for businesses to have
access to and aware, then apply into their business.
First, the state should create open information environment for businesses to
have access to and know that there is cost management accounting tool to provide
useful information for all levels of internal management in business.

Second, the Financial Accounting has been legislated to regulate the general
standard way for businesses throughout the economy but for management accounting,
there is only circular 53/2006 / TT-BTC defined very general basic accounting
management, content of management accounting There is a need for issuing
specific and open guidelines for business to refer and apply appropriately.
Third, schools where teach accounting need to specialize and pay more
attention in accounting management modules, consider on par with financial
accounting so that, students when graduating can implement the management
accounting techniques in the specific businesses.

CONCLUSION
Vietnam economy in current crisis period requires the companies to promote their
internal strong in order to apply flexibly solutions against difficulties. Controlling
production activities and business in the companies appropriately by the best decisions is
one way to solve economic problems, in order to gain business effectiveness. In this
economic situation, the cement companies are getting in very difficult status because of
the direct effect of construction industry in our country.
Controlling costs to get profit object is an effective tool which has been tested by
experiences of management in Japan, France, and America. The author’s desire is to
promote the roles of an economic management tools which is cost management
accounting applied in the cement companies and solve their difficulties. Therefore, the
author chose the research project which is to build cost management accounting model
for the cement manufacturing companies. This project is used for research and applied to
solve their difficulties by the cost management accounting tool.
In the scope of this thesis, the author has solved following matters:
To interpret opinions about the model in general, then show the opinion and
nature of cost management accounting management model in particular.
To present all gained result of the survey about the current status of cost
management accounting conducted and applied by the cement manufacturing companies
in Vietnam, then show the success, the backwards and their causes in the companies.

To build cost management accounting model with its factors which are suitable to
the characteristics of the cement companies in Vietnam.
In the scope of this thesis, the author has tried to apply the knowledge and
research experiences to complete. However, the gained results still has some restrictions
which need to be enhanced. The author wants to get advice from professors and
colleagues to be better.