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handbook for Technical Directors

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<strong>Technical</strong> department set-up / 3<br />

29<br />

Cost centres and cost types<br />

In associations with a basic accounting system there will be two recurrent terms: cost centres and cost types.<br />

Cost centre: a section of the budget (usually identified by a number) that refers directly to a unit or<br />

department. Depending on the complexity of the operations and the accounting system, the technical<br />

department will be associated with one cost centre and/or several accounts (sometimes called project<br />

types or cost units) related to activities or specific projects (education, youth football, grassroots, etc.).<br />

It is usually the responsibility of the technical director to approve the expenditures that fall within<br />

his cost centre and related accounts.<br />

Cost type: cost types relate to how the money is spent (accommodation, transportation, material,<br />

etc.) and usually more concerns the finance department. Nevertheless it can contain useful<br />

in<strong>for</strong>mation <strong>for</strong> the technical director to better understand how the development money is<br />

spent and whether the situation is in line with the identified needs.

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