International Journal of Finance & Managerial Accounting

International Journal of Finance & Managerial Accounting

Validation and Performance Evaluation of Cost Measurement in the Petrochemical Industry

Document Type : Original Article

Authors
Asgar Askari 1
Seyyedeh Mahboobeh Jafari 2
Nourouz Norollahzadeh 2
Reza Mansourian 2
1 PhD Candidate in Finance, Department of Accounting and Finance, South Tehran Branch, Islamic Azad University, Tehran, Iran
2 Department of Accounting and Finance, South Tehran Branch, Islamic Azad University, Tehran, Iran
10.22034/ijfma.2026.79202.2368
Abstract
This study was conducted with the aim of developing and validating the Integrated Costing–Forecasting–Analysis Model (ICCPM), a framework that simultaneously addresses the three core tasks of industrial management: accurate cost calculation, forecasting future changes, and agile analysis of cost responsiveness to environmental variables. In this model, activity based costing was designed using actual cost drivers, and the results demonstrated a significant improvement in cost calculation accuracy compared to traditional methods. The statistical population of this study covers the period from 2019 to 2024
For the forecasting component, two approaches—multiple regression and random forest—were employed. The substantial reduction in error metrics such as MAE, RMSE, and MAPE confirmed the efficiency and robustness of these models.
To analyze the impact of environmental changes, a set of scenarios (S0 to S8) was developed. Findings revealed that feedstock price is the most influential cost driver, generating the highest level of cost fluctuation. Furthermore, agility indicators showed that ICCPM’s technological infrastructure and integrated data flow led to a noticeable decrease in execution time and enhanced model responsiveness in dynamic conditions.
Additionally, operational mechanisms—including energy consumption forecasting, a MILP-based optimization model, and the DRAO mechanism—facilitated the practical implementation of ICCPM in real-world environments.
Overall, the results indicate that ICCPM provides a comprehensive and reliable framework for cost management, forward looking planning, and rapid decision making in process industries and volatile environments, delivering an accurate, dynamic, and trustworthy representation of cost behavior.
Keywords
validation
performance
performance evaluation
cost measurement
petrochemical industry
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