German Cost Accounting

Paul Sharman, ACMA, former CEO of the Institute of Management Accountants, says German accounting systems developed in response to a financial accounting system that was highly defined by government reporting requirements but wasn’t especially helpful to managers in supplying information needed to manage the business.

Jun 1st, 2011

Developed shortly after World War II, Grenzplankostenrechnung (GPK in English) was applied to many manufacturing companies in Germany and German-speaking countries, as well as to banks and the postal system. In 2003, Sharman visited the controller’s department in six corporations: Porsche (cars), Stihl (chain saws), DaimlerChrysler AG (cars), Rasselstein Hoesch (steel), Magna Steyr (cars) and Brau Union (beer). All had been using GPK for more than 20 years. When Sharman asked “if operations managers were happy with the system and trust it,… the answer was an overwhelming ‘yes’ in all cases,” he says.

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