DefinePK

Abstract

The ABC method improves upon the traditional costing (TDC) method, but its implementation presents significant challenges for manufacturing cost accountants in Vietnam, necessitating an investigation to identify practical solutions. To achieve this objective, the study was conducted with the participation of 106 participants, including accountants, chief accountants, and business managers from various enterprises in Binh Duong province, Vietnam. The findings show that the ABC method brings many limitations to its implementation. In particular, Vietnamese enterprises encounter several significant challenges in implementing the ABC method. A major obstacle is the lack of human resources with in-depth expertise. Additionally, many businesses, particularly small and medium-sized enterprises, face substantial initial investment costs for staff training, software acquisition, and information management system enhancements. In addition, collecting and managing detailed data on activities and costs is also challenging due to the absence of standardized information management processes. Moreover, fluctuations and market risks in the developing Vietnamese economy can affect cost forecasting and planning, further reducing the effectiveness of the ABC method. The method also requires continuous data updates and detailed activity analysis, which can be complicated and time-consuming, particularly for businesses with complex processes. Furthermore, some enterprises are resistant to change, favoring traditional cost management methods and failing to recognize the benefits of the ABC method, leading to suboptimal implementation. To overcome these challenges, businesses must prepare by training staff, investing in technology, and securing leadership support for effective ABC implementation.
Keywords:  Difficulty, Activity-Based Costing Method, Businesses, Vietnam