Final answer:
Standard costing can offer various benefits including identifying cost variances, improving budgetary control, and enhancing decision-making. To improve management accounting control systems, Hindustan Ltd. could implement Activity-Based Costing, integrated information systems, and value chain analysis.
Step-by-step explanation:
Benefits of Standard CostingStandard costing can lead to several benefits for Hindustan Ltd. This system involves setting predetermined cost estimates to help measure variances between expected and actual performance. By using standard costing, the company can:Identify cost variances which can pinpoint areas where the organization may be overspending or saving costs.Improve budgetary control as it allows managers to compare standards with actual costs and make decisions based on these insights.Enhance decision-making by providing clear cost data that can influence pricing, product mix, and cost-saving strategies.Strategic Cost Management InitiativesTo restore the relevance of management accounting control systems, Hindustan Ltd. could adopt the following strategic cost management initiatives:Implement Activity-Based Costing (ABC) to get a more accurate cost assignment by focusing on the cost drivers and activities.Invest in integrated information systems that provide real-time data, which enhances the ability to monitor costs promptly.Focus on value chain analysis to understand the which parts of the operation add most of the value to the end product and optimize those.Utilizing these strategies can help management regain control over the costs and improve the overall planning and control framework of the company.