An Application Research On Activity-based Costing Method For Intermediary Business In China's Commercial Banks

Under special operation mechanism, commercial bank management in China is displaying characteristics of focusing on growth but ignoring quality for a long time, which causes the serious consequences like cost concept lacking, and cost-effective ratio matching being incompatible. What's more, there're challenges of daily-increased foreign banks entering China, how to use the opportunity to reform in order to improve their cost management, and improve the core competitive power, is a problem presented and needed be solved urgently for commercial banks in China. Activity-based Costing calculation is a task-based science information system, through the operation management all the time. By dynamic reflection of all operation, it can better fulfill its role in decision-making, planning and controling. It is based on products consume resources and operations as the focus, and timely and effectively provide the required information cost control based on the cost drivers. Compared to traditional accounting method, it makes cost accounting no longer simple and cost accounting process no longer lagged, and also to provide useful information decision-making for the bank. For those commercial banks that need to improve the cost management level of intermediary business, activity-based costing method is an effective method. Its accounting principle is according to "product consumption assignments and operation consumes resources", using a variety of methods to allocate indirect costs to each product distribution, which makes the entire product cost even more realistic and reliable. And the activity-based costing method is suitable for the industries with various kinds, indirect cost with big proportion, and intermediary businesses of bank just meet this requirement. Therefore, it can improve the cost management level of the intermediate services and better for products decision-making of the intermediary business by using the activity-based costing method in cost accounting for the intermediary business, thus to make the biggest contribution of economic benefits for banks.This paper is divided into six parts. The first part is the introduction, including research background, research significance, research situation, research methods and research approach, framework and innovation of this paper. The second part is the fundamental theoretical part of activity-based costing,introducing three basic theories of the paper, including the cost of the basic theory of operation, cost driver concept theory, and theory of two-dimensional cost. The third part introduces the intermediate services and its characteristics, and then analyses the feasibility and necessity of activity-based costing method in the implementation of the intermediary business. The fourth part is a case study, taking a branch of Construction Bank of Hunan province as the research object, using the activity-based costing method for intermediate business cost accounting. The whole case process is divided into four stages, which successively are design preparation stage, design phase, design implementation phase and the final result analysis stage. The fifth part is the budget and control of activity-based costing, comparing budget and practical results of cost to find deviation and to correct deviation, as well as to control activity-based costing. The last part is the conclusion to summarize to full text and draw the final conclusions of the article.