☛ Policies and procedures?

☛ Bill of Materials (BOM)

☛ What is the process followed to establish a standard bill of materials?

☛ How does the process differ if a part is new or existing?

☛ Who approves the bill of materials?

☛ Who is responsible for entering the BOM into the system?

☛ What is the process for reviewing and monitoring variances between the standard bill of materials and the actual costs?

☛ How often are management reports prepared?

☛ Do the management reports contain the appropriate level of detail to identify root causes for the variance?

☛ Standard costs

☛ How are the standard labor hours by product determined?

☛ How are standard machine hours determined? Set up and run times?

☛ How are labor charges applied to the cost of inventory?

☛ How are the costs of labor checked for accuracy, completeness, etc?

☛ What is the process to update standard costs based on current procurement and production costs?

☛ How often are the standard costs updated?