Accounting For Quality

Abstract

Examines the theory and practice of “cost of quality” and whether it warrants a place in management accounting. Discusses the assertion, supported by research, that the indirect costs of poor quality are several times the direct measured costs of scrap, rework and warranty. Looks at a survey of attitudes and systems in Japan comparing the Japanese companies with their American counterparts. Describes the quality costing system in a British company and charts its attempt to account for quality by reference to BS 6143. Concludes that as an ongoing addition to existing management accounting, quality costing does have a major role to play in monitoring and controlling the drive towards quality improvement.

Citation

Jeeves, A. (1993), "Accounting For Quality", The TQM Magazine, Vol. 5 No. 4. https://doi.org/10.1108/EUM0000000003085