Analysis of the potential implementation of Material Flow Cost Accounting (MFCA) in muslim fashion SMEs Y

https://doi.org/10.35912/ijfam.v5i1.1512
Published: Jul 4, 2023

Abstract:

Purpose: Conducting analysis on the current inventory control and proposing suggestions and improvements related to inventory control in SMEs Y using the Material Flow Cost Accounting (MFCA) approach.

Research methodology: This research adopts a case study approach with research methods including observation, document analysis and interviews.

Results: Based on the summation of raw material costs, energy costs, and system costs, the total allocation of product costs and allocation of material loss costs can be calculated. In the cost flow matrix, it is concluded that the company experiences a material loss of 7.5%. In fact, every production stage generates waste, and although the percentage of material loss may not always be significant, by reducing that percentage, the company can enhance the cost efficiency of its production.

Limitations: The focus on manufactured firms especially SMEs Y limits the generalizability of the study findings to other sectors of the economy and scalability.

Contributions: The results of this study can be used as a consideration in formulating policies related to the management of fashion raw material inventory in Indonesia, particularly for other SMEs in managing their inventory and if they intend to implement Material Cost Flow Accounting in their production processes.

Keywords:
1. Material Flow Cost Accounting
2. Production
3. Raw Material
4. Efficiency
Authors:
1 . M. Wahyudi Pranata
Faculty of Economics and Business, Indonesia University, Indonesia
2 . Desi Adhariani
Faculty of Economics and Business, Indonesia University, Indonesia
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How to Cite
Pranata, M. W., & Adhariani, D. (2023). Analysis of the potential implementation of Material Flow Cost Accounting (MFCA) in muslim fashion SMEs Y. International Journal of Financial, Accounting, and Management, 5(1), 97–111. https://doi.org/10.35912/ijfam.v5i1.1512
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Issue & Section
Vol. 5 No. 1 (2023): June
Articles
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References

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  1. Alfian, R., Ritchi, H., & Hasyir, D. A. (2020). Analisa Implementasi Material Flow Cost Accounting (MFCA) Pada Perusahaan Industri (Studi Kasus pada PT. Unipres Indonesia). Jurnal Apresiasi Ekonomi, 8(1), 86–98.
  2. APO. (2014). Manual on Material Flow Cost Accounting: ISO 14051. Asian Productivity Organization.
  3. Aprilianti, A., & Hidayat, Y. R. (2019). Pengaruh Just In Time Terhadap Efisiensi Biaya Produksi Pada PT. Toyota Boshoku Indonesia. Jurnal Logistik Indonesia, 3(2), 125–133. https://doi.org/10.31334/logistik.v3i2.619
  4. Badan Pusat Statistik. (2023). Berita Resmi Statistik. In Www.Bps.Go.Id (Issue 17/02/Th. XXIV). https://www.bps.go.id/pressrelease/2020/02/05/1755/ekonomi-indonesia-2019-tumbuh-5-02-persen.html
  5. Balkhi, B., Alshahrani, A., & Khan, A. (2022). Just-in-Time Approach in Healthcare Inventory Management: Does it Really Work? Saudi Pharmaceutical Journal. https://doi.org/10.1016/j.jsps.2022.10.013
  6. Burritt, R. L., Hahn, T., & Schaltegger, S. (2002). Towards A Comprehensive Framework For Environmental Management Accounting - Links Between Business Actors And Environmental Management Accounting Tools. Australian Accounting Review, 12(2), 39–50.
  7. Dierkes, S., & Siepelmeyer, D. (2019). Production and cost theory-based material flow cost accounting. Journal of Cleaner Production, 235, 483–492. https://doi.org/10.1016/j.jclepro.2019.06.212
  8. Dinar Standard. (2021). State of the Global Islamic Economy Report. In State of the Global Islamic Economy Report 2020/21. https://cdn.salaamgateway.com
  9. Fakoya, M. B. (2015). Adopting material flow cost accounting model for improved waste-reduction decisions in a micro-brewery. Environment, Development and Sustainability, 17(5), 1017–1030. https://doi.org/10.1007/s10668-014-9586-x
  10. Graff et al. (1998). Snapshots of Environmental Cost Accounting. In Snapshots of Environmental Cost Accounting. Tellus Institute.
  11. Huang, S. Y., Chiu, A. A., Chao, P. C., & Wang, N. (2019). The application of material flow cost accounting in waste reduction. Sustainability (Switzerland), 11(5), 1–27. https://doi.org/10.3390/su11051270
  12. IFAC. (2014). Environmental Management Mccounting. In Handbook of Research on Developing Sustainable Value in Economics, Finance, and Marketing (Issue August). https://doi.org/10.4018/978-1-4666-6635-1.ch016
  13. Jun, C., Lee, J. Y., & Kim, B. H. (2017). Proceedings of the 2017 Winter Simulation Conference W. K. V. Chan, A. D’Ambrogio, G. Zacharewicz, N. Mustafee, G. Wainer, and E. Page, eds. Proceedings of the 2017 Winter Simulation Conference, 4454–4455.
  14. Kemenparekraf. (2023). SIARAN PERS?: Menparekraf Harapkan Industri Fesyen Jadi Tuan Rumah di Negeri Sendiri. https://www.kemenparekraf.go.id/berita/siaran-pers-menparekraf-harapkan-industri-fesyen-jadi-tuan-rumah-di-negeri-sendiri
  15. Kepemenperin. (2022). Kemenperin Targetkan Industri Fesyen Muslim Indonesia Jadi Pemain Global. https://kemenperin.go.id/artikel/23719/Kemenperin-Targetkan-Industri-Fesyen-Muslim-Indonesia-Jadi-Pemain-Global
  16. Kokubu, K., & Kitada, H. (2015). Material flow cost accounting and existing management perspectives. Journal of Cleaner Production, 108, 1279–1288. https://doi.org/10.1016/j.jclepro.2014.08.037
  17. Pristianingrum, N. (2017). Peningkatan Efisiensi Dan Produktivitas Perusahaan Manufaktur Dengan Sistem Just In Time. ASSETS - Jurnal Ilmiah Ilmu Akuntansi Keuangan Dan Pajak, 1(1), 41–53.
  18. Saunders, M. A., Lewis, P., & Thornhill, A. (2020). Research Methods for Business Students Eights Edition Research Methods for Business Students. In Research Methods for Business Students. Pearson Education. www.pearson.com/uk%0Ahttps://www.amazon.com/Research-Methods-for-Business-Students/dp/1292208783/ref=sr_1_2?dchild=1&qid=1614706531&refinements=p_27%3AAdrian+Thornhill+%2F+Philip+Lewis+%2F+Mark+N.+K.+Saunders&s=books&sr=1-2&text=Adrian+Thornhill+%2F+Phili
  19. Vaismoradi, M., Turunen, H., & Bondas, T. (2013). Content analysis and thematic analysis: Implications for conducting a qualitative descriptive study. Nursing and Health Sciences, 15(3), 398–405. https://doi.org/10.1111/nhs.12048
  20. Yin, R. K. (2018). Case Study Research and Applications Design and Methods. In Angewandte Chemie International Edition, 6(11), 951–952. (6th ed.).