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Inactivity Based Cost Management: Measurement of Intangible: Governance, Ethical & Fiscal Responsibility and Accountability Paperback – November 10, 2010
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About the Author
Jayaraman Rajah Iyer is a Chartered Accountant from ICAI, New Delhi (1966) who has a unique insight into major changes in accounting in India's history culled from experience with major firms across the globe. This book is the outcome of several years of practical knowledge on Governance extracted from 1966 when Govt. of India introduced Cost Audit System for Vegetable Oils that every manufacturing company would go to the government for a small increase in prices of their products every fortnight. The system continues even now for several commodities including Medicine. The impact on cost accounting methodology adopted is unique and known to India for long. In 1972 as Forestry Operations Accountant for Wimco, subsidiary of the Swedish Match Company, Jayaraman acquired an in-depth knowledge of forest terrains and realized a discrepancy between the accounting year for WIMCO (Jan. to Dec) and the forestry season (Sep. to March). This made it difficult to estimate cost for wood sent to the factories. This prompted him to institute a system called Likely Ultimate Cost to achieve a balanced figure through the year without overloading a cost figure at the end. It necessitated estimating cost constantly a year ahead. In the course of his duty in WIMCO, as per the case study detailed in the book, Jayaraman was called upon to play whistle-blower to corrupt practices. He says "An Accountant is the trustee of the public wherever he/she is employed. The personal case study reported in this book is not to be construed as whistle-blowing but performing one's duty. An Accountant undertakes social responsibility quietly fighting for justice where 'matsyanyaya' is prevalent. Matsya means fish and nyaya justice, where the big fish swallows the small one." Jayaraman went through subsequent inquiries at great personal cost to be vindicated in his stand against corruption. His joining the Wellcome Foundation, UK, later remains possibly the only HR case study when he joined a company despite a written negative reference from the previous employer specifically imploring the new employer not to appoint him. It was in 2001, called upon to prepare a normal ROI for an investment in a major ERP package that Jayaraman drafted a unique methodology - RoI based on intangible, covering the entire spectrum of usage of an ERP package and its capability rather than submitting to the futility of its usage, hovering around 8% for almost all highly priced ERPs, based on cash-flow. These three major areas of experience form the fulcrum of Governance as set by the book: 1. Real-time Monitoring, 2. Cost Consequence and 3. People Participation.
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