What are Indirect Costs?

Indirect costs, also referred to as overheads, are costs and expenses that cannot be directly traced to a specific product, service, or department. These costs generally support overall organizational operations and may include items such as administrative salaries, rent, utilities, and IT equipment.

What are Direct Costs?

Direct costs, on the other hand, map directly to the production of a specific good or service. Each direct cost can be directly tied to a cost object, which could be a product, service, or department.

What is the difference between Indirect and Direct Costs?

Both indirect and direct costs are key costs for any business. Direct costs map straight to a specific product, service, or department, while indirect costs (also known as overheads) include overall business expenses, salaries paid to HR staff, and other costs not directly associated with a specific product, service or business department. The distinction between indirect and direct costs naturally leads to a strong distinction in how we will approach allocating the costs to these expenses.

What is cost allocation in simple terms?

Cost allocations are deployed in order to form a detailed understanding of what it costs to provide a service, to make a product, or to carry out a project. Accurate cost allocation is critical for organizations of all sizes to make informed decisions, and are a key part of management accounting.

What is a cost object?

A cost object is what you want to measure costs for such as a product, service, customer, project, or department.

What are direct cost allocations?

Direct costs are not directly linked to a cost object, allocation is straightforward and typically does not require complex methodologies. For example, in manufacturing, raw materials and direct labor costs may be allocated to individual products based on usage. This allocation method helps businesses determine product profitability, set prices that are competitive and minimize unnecessary costs.

What are indirect cost allocations?

Indirect costs require a structured approach to allocation since they cannot be directly traced to a single product, service, or department. These costs may be distributed based on relevant usage metrics, such as labor hours, revenue contribution, or production volume.

PowerBI for Financials

How you can get the best data for PowerBI financial dashboards

How Poor Data Processes Undermine Finance Decisions

Poor data processes undermine financial decisions, and understanding ETL – extract, transform, load – is where more reliable reporting begins.

Getting the most of Microsoft’s data visualization tool PowerBI

PowerBI is one of the most used tools by enterprise finance teams. PowerBI is deployed as a dashboarding and data visualization tools by financial teams. However, to output valuable insights, Power BI needs an “engine” to serve it the right data.

CostPerform is an enterprise cost modeling and cost allocation tool. The software is focused on mapping, and analyzing financial data for organizations in Financial Services, telecoms and beyond.

CostPerform specializes in connecting with PowerBI in order to create a robust enterprise finance data and visualization suite. Below, we outline exactly how CostPerform connects to PowerBI, allowing enterprise finance teams to get the most out of their PowerBI financial suite.

PowerBI: Key Integrations for Financial Teams

So here’s how to connect CostPerform to PowerBI, creating a best practice eco-system

Modern finance teams use data warehouse solutions like Snowflake or Microsoft Azure. In order to get the most of PowerBI, financial and accounting teams need to have their data warehouse up to speed, with the correct data. A good data warehouse for an enterprise finance team has the following traits:

Data Quality & Consistency

Data Integration (our focus in this article)

Scalability & Performance

Step 2. Connect CostPerform to your data warehouse.

Use built-in data warehouse functions to connect CostPerform to your data warehouse. You can export all data for objects, allocations, and breakdowns into single, structured table. This is an essential step towards getting the most out of PowerBI for finance teams.

A list of data sources you can connect to PowerBI

PowerBI’s O365 interface displaying a wide range of available database and data warehouse connections as standard

Step 3. Connect PowerBI directly to your data warehouse.

Via the “Get Data” menu tab, or when creating a new project in Power BI, finance teams can create the connection to their data warehouse. Under this menu, you can connect directly to Snowflake, Microsoft Azure, or Redshift. It is also possible to create a custom connection using server details.

Step 4. Get accurate and live financial dashboards in PowerBI

After connecting both PowerBI and CostPerform to your data warehouse, finance teams can view live insights, with data processed in the back-end by the CostPerform engine, and visualized in PowerBI. Finance teams can create a strong, accurate and insightful interface that reveals the most important insights to enterprise finance teams at the right time.

CostPerform Insights screenshot, showing data visualized

CostPerform Insights offers data visualization natively within the CostPerform tool, an alternative to visualizing data in PowerBI

CostPerform & PowerBI: A powerful duo

Using CostPerform & PowerBI together creates a powerful combination for finance teams operating in spaces like financial services, banking, telecoms, and even government. Financial accountants can get the most out of their PowerBI dashboards by ensuring they are filled with data of high quality and consistency.

CostPerform excels at creating this data, expertly modeling and allocating the costs of an organization with ease and accuracy. By connecting this data source to PowerBI via the data warehouse, finance teams can be sure that they are bringing the best insights, and decision-making support to their organizations.

Table of Contents

PowerBI for Financials

Getting the most of Microsoft’s data visualization tool PowerBI

PowerBI: Key Integrations for Financial Teams

Step 1. Get your financial data warehouse in order.

Step 2. Connect CostPerform to your data warehouse.

Step 3. Connect PowerBI directly to your data warehouse.

Step 4. Get accurate and live financial dashboards in PowerBI

CostPerform & PowerBI: A powerful duo

Discover what CostPerform can do for your enterprise organization

Download our brochure

Solutions

Markets

ISO 27001 certified

© CostPerform 2026 | Privacy Policy | Cookie statement | Cookie preferences | Terms of Use | Responsible Disclosure Policy