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Basic standard

A basic standard is retained for a relatively long period as a consistent benchmark for observing trends. It is not routinely updated for current prices or operating conditions. That continuity helps long-term comparison but limits usefulness for current cost control or motivating achievable performance. Reports should identify inflation, process changes and other factors explaining the gap rather than treating the full difference from an old benchmark as current inefficiency.

Worked example

A 2020 labour-time standard is retained to show long-term productivity improvement, while a separate current standard is used to assess this year’s operations.

Common mistake

Do not describe basic as merely a simple calculation or assume it represents current attainable performance.

Where it appears in your exams

QualificationExamRelationshipPeriod
ACCA MA Supporting September 2026–June 2027
ACCA PM Direct September 2026–June 2027
FIA FMA Supporting September 2026–June 2027