Profitability analysis through the implementation of an accounting and control model based on standard costing

The thesis examines how the implementation of a standard cost-based accounting and control system can enhance profitability and operations performance analysis. The work originates from a real business case project encountered during my internship at Ernst & Young S.p.A. The case focuses on a manufacturing company operating in the field of manual and automatic sun-shading systems, which, for reasons of confidentiality, will be referred to as Alpha S.p.A. In 2023, the firm launched the implementation of a new ERP, as part of a larger program of digital transformation. Despite its technological developments, the implementation revealed the lack of a structured management control model that would provide an integrated view between statutory and managerial accounting. To address this gap, a new control model, based on two main principles, was designed. First, the adoption of the standard costing methodology enabled detailed performance measurement through variance analysis. Second, the integration of the perpetual and periodic inventory accounting systems allowed a switch from an aggregated to a multidimensional analysis. The thesis describes the theoretical foundations and current state-of-the-art of standard costing as a methodology for evaluating commercial performance and internal efficiency. Moreover, it introduces the concept of a single integrated accounting model to support the integration of managerial and statutory accounting systems and the automatic reconciliation between periodic and perpetual accounting systems. These principles are applied to the case of Alpha S.p.A., showing how the model aims to reinforce the controlling role within the company, enhance information reliability and punctuality, and enable Finance & Controlling development in a complex and competitive industrial environment.