Overview

Contribution Analysis Reporting (CA)

Contribution analysis provides an indication of the profitability level of a customer, product or service line. It provides focus on how effective your marketing, pricing and service level strategies are performing currently. Plus, how they may need to be adjusted going into the future in order to improve contribution levels.

This information may not be readily available in the standard reports included within most accounting software packages that are commonly used by small business.

LedgLink Solutions can provide contribution analysis reporting customised to your individual business circumstances. The service includes the following components:

• Requirements analysis to determine your reporting needs
• Review of your current accounting software package set up and recommendation of any configuration changes required to support contribution analysis reporting
• Implementation of an appropriate cost model (CM) with rules to allocate indirect and overhead items to customers, product or service lines
• Contribution analysis reporting delivery relevant to your business
• Implementation of a pricing model that integrates with the cost model
• Implementation of budgets and forecasts to control and monitor actual performance
• 'What-If' modelling used to explore the impacts of implementing competing business options

How the CA Reporting Service works

• The service is offered on an outsourced/hosted basis only
• Your business data is provided to LedgLink as either a copy of your company data file or MS Excel format extract files. This data is treated as strictly private and confidential (Please refer to the privacy link below). The data will only be used to generate your nominated reports.
• LedgLink generates and delivers your reports
• LedgLink can present the reports in a management review meeting at your request
• LedgLink can perform any follow up analysis or investigation work at your request
  

CA Reporting Service Pricing

• The service is offered on a 'pay per report' basis ($55 per basic report and $110 per complex report per generation inclusive of GST)
• Accounting software package licenses required for data extraction, incurred by LedgLink will be recovered at cost plus 10%. These licenses may be paid directly by yourself as the owner of the accounting software package providing the data.
• Presentation and analysis/investigation services additional to report delivery will be charged at current consultancy rates

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Implementation of Cost Models (CM)

LedgLink specialises in designing and implementing cost models that can be used to allocate direct and indirect costs to products and services based on specific business rules appropriate to your particular business situation. These cost models can also be extended to include administration and overhead items at your option.

The benefits of CM include:

• A high degree of confidence that all costs, both direct and indirect, are reflected when pricing your products
  
• Standards have been set for inputs, conversion and outputs in the manufacturing or delivery processes. Actual's can then can be measured against these standards for monitoring and controls purposes

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Planning for Administration and Overhead Costs (PL)

LedgLink specialises in designing and implementing planning models that can be used to monitor and control administration and overhead costs at a low level, such as, at the function or cost center. We look to model costs based on their underlying variables and dependencies, so that they can be measured objectively. These models can be used to generate fixed or variable budgets and rolling forecasts that can be utilised within the standard periodic reporting cycle.

The benefits of PL include:

• Modelling places you into a formal planning cycle that focuses you on how your business operates. Monitoring activity against a plan provides feedback that can be used to improve business processes.
  
• Variances against budget can be broken down into a cause and effect factor analysis. There will be a better understanding of how variances are influenced by volume, rate and mix components. This in turn will provide an understanding of what is uncontrollable or controllable and what can be influenced by management intervention.