Material Flow Cost Accounting: An Appropriate Tool for Achieving Sustainable Development in the Manufacturing Process, Case Study: Azar Kavin Co.

Sustainable production and consumption are significant issues in the process of achieving sustainable development that can impact the economy in differentareas of microeconomics, inter-sector and macroeconomics. Therefore, if production and consumption are not optimized, the economy will face seriouschallenges on its journey towards sustainable development. Manufacturing firms play an important role in sustainable development because of their consumption of raw materials and energy. Moreover, waste constitutes a significant share in the manufacturing process. Material Flow Cost Accounting is a system that is of great importance in increasing productivity and reducing costs and in production and consumption sustainability through the three principles of reducing, reusing and recycling. In order to increase productivity, this system can be implemented in the value chain of manufacturing firms. For this purpose, this system was implemented in Azar Kavin Co., producer of fire fighting foam liquids for use in the oil, gas and petrochemical industries. The results of the study determined and visualized the flow of materials and material and energy loss in the company. After implementation of MFCA in the company, the largest and smallest amounts of material and energy loss were determined to be in the boiling and packaging centers, amounting to 530,260,000 (29.8%) and 192,740,000 (10.8%) Rials, respectively. Finally, some strategies were suggested for reducing the production costs and material loss and for decreasing environmental damages.

Keywords:

Sustainable development , Material Flow Cost Accounting (MFCA) , Productivity , Manufacturing process , Oil , gas and petrochemical plants , Azar Kavin Co