Study Of The Activity-based Budgeting System In Coal Mine Enterprises

Recent years have witnessed the unceasing exploration into issues such as enterprise management and effective control of economic activities by most state-owned coal mine enterprises. Pressed by fierce market competition, most state-owned coal mine enterprises have introduced modern management and control theories concerning issues such as activity cost management, overall budgeting management, flexible budgeting, zero base budgeting, increment budgeting and achievement appraisal, which contributes to the establishment of supervision and control model with its own characteristics in each individual enterprise. Despite the similarities in appellation and functioning of each constructed supervisory control system, concrete administration mode and management method in one enterprise differ from that in another enterprise, which leads to various differences in management and control effects. With the enterprise's continuous development and expansion, high efficiency of supervision and control has become an important criterion for evaluating modern enterprise's management system.The introduction of Activity-Based Costing (ABC) method is conducive to the improvement of resources' distribution and allocation owing to the procedures of its dynamic management model, that is, arrangement in advance, supervision and control in process and analysis afterwards, which combine to serve to achieve the strategic aim. Unsurprisingly, derived from Activity-Based Costing (ABC) method, Activity-Based Budgeting (ABB) method is attracting more and more attention from enterprise managers for its advantages. In this thesis the author tries to apply this advanced budgeting supervision method to coal mine enterprises, hoping to make contributions towards reforming unsatisfactory situations in coal mine enterprises, exemplified by the divorce between coal mine enterprise budgeting and enterprise's development strategy, distortion and vagueness of budgeting caused by overemphasis on financial indexes, etc.This thesis starts with the concept of budgeting, introduces the exertion and existing problems of traditional budgeting in enterprise management, recommends Activity-Based Budgeting (ABB) method as a profitable method, then presents the concept of ABB method and makes a detailed analysis of its basic principles to show its various advantages. The core of this thesis is the feasibility analysis of ABB method applied in coal mine enterprises. The establishment of ABB management system involves several procedures as follows. It begins with the application feasibility analysis of ABB method in coal mine enterprises. What follows in succession is to build an ABB model, analyze budgeting flow and procedures, divide activity center, makes activity agent analysis and resource agent analysis guided by ABB method principles, achieve operational balance and financial balance and check through the cost. It concludes with the achievement appraisals of budgeting system that is based on fixed cost variance analysis, variable cost variance analysis and indirect cost variance analysis beforehand.The research subject of this thesis is the application of Activity-Based Budgeting (ABB) method in large-scale coal mine enterprises. It is attempting for the first time to apply ABB managing method to counteract the deficiencies of traditional budgeting managing method prevailed in many coal mine enterprises. Fulfilling the need for further development of coal mine enterprises in modern society, this study is of great practical and social significance.