What is ABB, and how is it different from ABC?....

At a high level, activity-based Budgeting (ABB) means presenting a budget in terms of the cost of an organization's products and services, rather than the traditional budget that describes cost factors (expense codes) such as compensation, travel, and training.

FullCost is NDMA's practical method and tool-kit to accomplish this.

ABB is distinct from Activity-based Cost Accounting (ABC Accounting), which means gathering costs (after-the-fact) by projects and services delivered. Both ABB and ABC Accounting involve the principles of activity-based costing, and are built on the same ABC business model. ABB is done before the year begins as a planning process, while ABC Accounting is a modification to accounting systems that track costs during the year.

The FullCost process is more robust than simple ABB, and more consistent with entrepreneurship, customer focus, teamwork, accountability. Click here to understand the differences.

Chapter from a book on why it's wise to do ABB before ABC Accounting....

In addition to producing a budget, ABB is used to calculate a cost-based set of rates (prices) for all the organization's products and services.