ABSTRACT
In any organisation, cost information can be used for a variety of reasons and in recent years the subject of costing (and the related issue of pricing) of activities has become very topical within the HE sector. In this chapter we consider costing in HEIs and in the next chapter move on to consider pricing and the role costing plays in pricing decisions. However, at the outset it should be noted that there is often confusion in some HEIs about the difference between costs and prices. The distinction between costs and prices is important and can be summarised:
Cost – this a financial expression of the resources committed by an organisation to a particular activity or product. Thus, when we say a particular item, such as a short course, costs £1,545.23 this means that the manpower, material and other resources, including overheads, committed to developing and delivering that course are estimated in monetary terms to be equivalent to £1,545.23.
