Following things should be taken into consideration while installing a costing system:

• Nature of the Product is a very important deciding factor in installing an EFFECTIVE costing system.
• Nature of the Organization should be CONSIDERED before installing costing system.
• Objectives of the Organization should be met with the installed costing system.
• Manufacturing Process: Before installing the costing system the technicalities of the manufacturing process should be studied carefully.
• Technical Details of the business must be studied before introducing NEW costing system.
• The system should be informative and simple. The system should be simple and easy to use in order to maintain various cost records.
• Reporting Systems: The costing system should be designed in such a WAY that reports are GENERATED in a proper way to facilitate the cost control decisions.
• The costing system should be elastic and capable of adapting according to the changing environment.

Following things should be taken into consideration while installing a costing system: