Making the Numbers Count, 2nd Edition

5 Value-Stream Accounting

Value-stream accounting is one of the cornerstones of accounting in lean companies. We do not collect costs by departments, or products, or individual production jobs. Instead, we collect costs by value-stream—typically, once a week. There are several reasons for this:

• Value-stream cost and revenue information can be gathered quickly and simply. When a company has a well-defined value-stream organization, gathering the costs of the value-stream each week is simple and straightforward.
• The cost information is direct cost, with few or no allocations. This means that the cost information is immediately understandable to the people who need to use it. In contrast, an income statement-developed using traditional standard ...