Application of Lean Accounting for production costs management in lean enterprises: a case study in an auto parts company

Abstract

The main purpose of this study is to analyse and to compare how the lean manufacturing changes, applied in the production system, are reflected in company´s financial reports. This case study practically compares the traditional accounting reports with the ones purposed by the Lean Accounting (LA) methodology version. The motivation of this case study started with the statement of unit managers of a Lean Manufacturing (LM) company, here called “lean enterprise”. They said that one of the greatest challenges, after the modifications in the production system, is the financial demonstration in costs reports. After change the production system from “push” to “pull”, the main structure for a cost per unit calculation and fix cost “dilution” are ruined. There is no mass production anymore, “the more, the better” philosophy does not lasts and the encountered results corroborate with the literature in regarding of the need of adapting the cost controlling system in Lean Enterprises.