The Search for Standard Costing in the United States and Britain

Abstract

This article describes the relationship between the understanding and practice of standard costing in both the U.S. and the U.K. and discusses the development of specific practices in the immediate post-World War II period. Based on a detailed review of the post-war literature, the authors conclude that the quantity and quality of standard costing and related scientific management practices (time study, variance analysis, etc.) reached a level in practice that many accounting historians have felt should have been achieved at an earlier point in time. Another principal finding is that standard costing, initially promulgated in the late 1910s, continued to develop in both the U.S. and the U.K. in evolutionary fashion into the late 1940s and 1950s, a finding which demonstrates that Britain was not as far behind America in terms of its standard costing practices as has been commonly believed. The article also explicates the relatively minor impact of the Anglo-American Council on Productivity, sponsor of sixty-six post-war visitations over a four-year period by British groups of employers, trade unionists and professionals, to study American industrial methods, including standard costing.