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Matrix Equations In Reciprocal Cost Allocation: An Application In The Takaful Industry In Malaysia
Journal
International Journal Of Accounting, Finance And Business
Date Issued
2019
Author(s)
Sharifah Fairuz Syed Mohamad
Syed Othman Alhabshi
Ahcene Lahsasna
Abstract
Shared and outsourced services have been generally allowed by the regulator (Bank Negara Malaysia, BNM) for commercial expediency and enhanced competitiveness of takaful companies in Malaysia. The different departments usually have a system of transferring the costs to each function; however the reciprocal method is rarely chosen. This study aims to analyze some of the methods of cost allocation through linear equations which will allow a large number of departmental cost transfers on Microsoft Excel. The study shows some relevant findings towards takaful operators’ decision on which method to adopt. The findings illustrates how the excel solver efficiently simplifies the calculation of reciprocal method of allocation which are generally avoided due to its complex computations.
Keywords: Linear equations, matrices, cost allocation, takaful operators
Keywords: Linear equations, matrices, cost allocation, takaful operators
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Matrix Equations In Reciprocal Cost Allocation An Application In The Takaful Industry In Malaysia.pdf
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Matrix Equations In Reciprocal Cost Allocation: An Application In The Takaful Industry In Malaysia
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